At more than 24 times last year's earnings this one miner may look expensive, but using my numbers for 2011 it's a great deal

With gold near $1,400 per ounce, major gold producers are going to make a ton of money in 2011.

Some investors will too, but it won't be as easy as you think.

Today, I'm going to show you which gold miner we must own in 2011. But before I get there, let me back up…

Gold prices are up, which is great for gold miners. But their costs are up, too.

To keep it simple, we can think of a gold miner's earnings as the amount it gets from selling gold, minus the amount it has to spend on the electricity, concrete, steel, and diesel fuel it needs to get the gold out of the ground.

The prices of electricity, concrete, steel, and diesel fuel are high and rising. The last time we saw these levels was in 2008. Take diesel fuel, for example. This is a major cost for gold miners. It runs everything from the excavators to the dump trucks.

In 2008, the average price of a gallon of diesel fuel was $3.80. Right now, it's $3.31 – and we're likely to see it climb over the next few months at least. So using the 2008 price is a reasonable assumption.

Below, you'll find a table of three of the biggest and best gold miners. I compared estimated 2010 earnings with what they'll make in 2011 if gold stays at $1,400 per ounce and costs are similar to 2008. Take a look…

As you can see, there is one clear winner. Goldcorp's net earnings will rise 86% from 2010's estimated net earnings. Barrick Gold's net will rise 42% in that scenario, while Newmont's nudges up 20%.

It turns out, Goldcorp is the cheapest among the three as well.

Here's another table, which shows you how much you're paying based on last year's earnings… and how much you're paying based on my estimate of their 2011 earnings…

At more than 24 times last year's earnings, Goldcorp may look expensive. But using my numbers for 2011, it's a great deal.

There's no guarantee gold will remain at $1,400. It could sink to $1,200. It could skyrocket to $1,800. But the big, long-term trend here is up… and if it continues, big gold miners are going to start rolling in profits. And the best deal in "big gold" is Goldcorp.

Disclosure: The author does not hold positions in any of the stocks mentioned