New Gold Inc. was braced for a vicious backlash from the investment
community when it decided to hedge some gold production earlier this month.
After all, hedging is the gold industry's ultimate dirty word. It became
such a toxic subject during the last decade that most chief executives
decided that even talking about it was off-limits. And New Gold is led by
Randall Oliphant, who headed up Barrick Gold Corp. back when it had the
biggest -- and most reviled -- hedge book in the business.
But the response to New Gold's move wasn’t negative. Instead, almost
everyone cheered.
"We've heard nothing but positive reactions from shareholders,
analysts, and media people to what we did," said Oliphant, New Gold's
executive chairman. "So that will give other people who want to do this
sort of stuff some ammunition." ...
... For the remainder of the report:
http://business.financialpost.com/news/mining...old-hedging-...
* * *
Australian Gold Miners Are Starting to Embrace Hedging Amid Strong Prices
By Peter Ker
Sydney Morning Herald
Thursday, March 24, 2016
Once upon a time, Newcrest Mining was adamant that shareholders did not
want the company to hedge its gold production.
"Our investors are looking for spot price exposure," former
chief executive Greg Robinson said in 2013, insisting that shareholders could
hedge their own positions by purchasing shares in other companies and
commodities.
However, with the gold price near record highs in Australian dollar terms,
the largest gold miner on the ASX has decided to embrace hedging.
Newcrest confirmed on Thursday a portion of the gold produced at the
Telfer mine in Western Australia had been hedged until June 2018. ...
... For the remainder of the report:
http://www.smh.com.au/business/mining-and-...-mining-chan...
