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The big dilemma for gold miners: There ain't much gold left.

Barrick Gold Corp. ABX.T +0.50% and Newmont Mining Corp. NEM +1.20% called off a planned $33 billion merger several weeks ago, trading barbs over who was to blame. But many investors said the world's two biggest gold producers are just postponing inevitable consolidation at the top of the embattled sector.

Toronto-based Barrick, at least, was eager to get together. After the talks stumbled late last month, Chairman John Thornton made his pitch to several Newmont investors.

"He was trying to get the point across that Barrick was very interested in going forward, and Newmont were dragging their feet," said Chris Mancini, an analyst at Newmont investor Gabelli Gold Fund.

Denver-based Newmont has said Mr. Thornton quashed the combination. Barrick and Newmont declined to comment on the collapsed merger.

No matter who killed the deal, gold miners face a troubled landscape.

The depletion of global gold mines, and the resulting increase in extraction costs, is one of the main forces pushing gold miners to combine as they look for efficiencies or to gain access to rivals' high-grade deposits.

"There is every reason to do that deal, and the reasons not to do it weren't geology, but man-made," said Douglas B. Groh, a fund manager at Tocqueville Asset Management LP, which owns Newmont stock. "The nature of geology is such that gold does not occur in large volumes, but the capital exploiting it is robust."

The gold industry ramped up exploration as prices increased by a factor of six from 2001 through 2012 to $1,750 a troy ounce. Prices since have tapered off to around $1,300 an ounce.

Discoveries also have tapered off. In 1995, 22 gold deposits with at least two million ounces of gold each were discovered, according to SNL Metals Economics Group. In 2010 there were six such discoveries, and in 2011 there was one. In 2012: nothing.

Even in Nevada, which mines around three-quarters of all U.S. gold, production has dropped a third since peaking in 1998. Around 40% of Newmont's and Barrick's production comes out of Nevada, with that possible economy of scale a big factor in their proposed merger.

"Deposits are simply harder to discover," said John Muntean, an associate professor of mines and geology at the University of Nevada.

The discovery of gold is influenced by a volatile set of factors, including price and how much companies are willing to spend on exploration. The higher the price of gold, the more economical it is to mine lower-grade deposits.

That was a reason behind the 35% decline in the grade of gold held by miners from 2001 to last year. Lower grades of gold require digging up more earth to find the metal so are more expensive per ounce. The cost of mining an average ounce of gold rose to $745 in 2012 from $280 in 2005, according to BMO Capital Markets.

There also is less gold to unearth. All the gold ever mined could fit in a 60-foot cube. At around 0.005 parts per million, gold's presence in the Earth's crust is minute compared with that copper, at over 50 parts, or iron, at more than 50,000.

When executive Stephen Letwin took a tour of Chinese gold mines this year, he asked himself, Where is all the gold?

Mr. Letwin, the chief executive of gold miner IAMGold Corp. IMG.T -0.84% , found the grades of gold being produced in the three pits he visited were so low that miners would need to dig up 100 metric tons of rock to produce just one ounce of gold. He said his own mines move around 32 tons of rock per ounce.

Mr. Letwin, a former energy executive, compared the gold industry's current state with that of the oil industry in the early 1990s, when worries over depleted resources led big companies to gobble up midsize ones.

Miners are plowing through available gold reserves faster than they are other metals. Global gold production was equal to 5.1% of the 54,000 tons in available reserves last year, according to the U.S. Geological Survey, theoretically meaning it would take 19.5 years to exhaust supply. That compares with 38.5 years for copper.

Geologists caution against predicting the depletion of any mineral, however. Supply can be increased if miners decide to spend more on exploration.

U.S. gold mining nearly died out after World War II, when the mineral was ignored in favor of copper, iron ore and other substances needed for the war effort. The 1970s brought the development of heap leaching, which uses cyanide to extract gold from deep inside rock, allowing companies to return to old mines and sift through discarded earth. The process brought a revolution similar to what hydraulic fracturing did for natural gas in shale rock.

"It's a fact that companies are having to go further afield and places that 20 years ago they never imagined they would be in," said Sean Boyd, the CEO of Toronto-basedAgnico Eagle Mines Ltd. AEM -1.23%

The grade of gold at the company's Meadowbank mine in the Canadian Arctic is over three times higher than at the average Canadian pit. But mining in subzero temperatures far from established infrastructure is more expensive, and Meadowbank likely won't make back its costs.

Other miners have had worse luck as they pushed into developing countries only to get socked with higher taxes and tougher environmental standards after they started work. Such factors contributed to more than $6 billion in write-downs by Barrick for its massive Pascua-Lama project on the Chile-Argentina border.

The gold industry still conjures images of prospectors striking it rich in California and the Yukon. But that era is over. "Those were the glory days," said Mr. Boyd. "It's tough slogging in this industry right now."