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Gold miners have benefited from flat to lower mining costs over the past year, but a weak U.S. dollar could reverse the process and costs could begin rising along with energy prices and a recovering economy.

Cost inflation was the industry's biggest headache between 2005 and 2008 and a key reason that gold stocks rose 50% while the metal jumped 90% in the period. A resumption of cost increases would eat into the benefits of the recent rise in gold prices and could hold back future stock gains.

While many miners won't release 2010 cost guidance until January, some already suggest cost increases are a concern.

Newmont Mining Corp., the world's No. 2 gold producer, said in its third-quarter earnings report it expects a 5% increase in costs in 2010, due in part to rising energy expenses and unfavourable exchange rates.

Others have been less willing to quantify potential cost increases, but admit it's on their minds.

"That is a risk. I don't know how to answer that definitively at this point, but that is a risk," Yamana Gold Inc. CEO Peter Marrone said in an interview, when asked whether the third quarter may end up representing the low ebb of costs.

Last year at this time, Mr. Marrone was singing a different tune. He was trumpeting declining oil prices and reduced demand for mining consumables such as sulfuric acid -- not to mention equipment made cheap as a result in the collapse of base metals prices -- as reason to expect lower costs in 2009.

That prediction largely has come to pass, but those comparisons could be set to reverse. Oil prices, which provide the basis for the price of diesel used to run mining equipment and electrical generators at many mine sites, crashed in the second half of last year, but have been slowly rebounding since February.

Year-on-year comparisons have been favourable for the first nine months of the year, but that could change in the fourth quarter, as average prices approach last year's levels.

If one is to believe that the global economy is on the rebound, demand for oil should continue to increase, as will demand for items such as mining chemicals such as sulfuric acid and cyanide, as well as construction materials and equipment.

"Through the 2008 fourth quarter and first quarter of 2009, cash operating costs were pulling back a little bit.... Since then they've already started to pick up again," said William Tankard, an analyst at metals consultancy GFMS.

"Whether you'd see [inflation] to the same extent as we saw through 2006 and 2007 when for gold producers it was running at about 10% a year. ... I would be looking at something a bit more moderate than that," said Mr. Tankard.