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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: long-gone who wrote (49906)	3/2/2000 11:37:00 AM
From: Alex	Respond to of 117012

Placer Dome sees gold price returning to around $US330/oz By Angela Macdonald-Smith SYDNEY, March 2 AAP - Canadian gold producer Placer Dome believes the gold price will return to its historical average of about $US330 dollars an ounce, However John Loney, vice president, commercial and chief financial officer at Placer Dome Asia Pacific said today that it was "very hard" to see it up above $US350 an ounce. He said the price progression would depend largely on to what extent producers continued to sell forward their production and on the behaviour of the central banks. Mr Loney said that Placer Dome's decision in early February to suspend its forward sales program and reduce its hedging was based on the expectation of improving gold market sentiment and of reduced producer hedging, on the agreement by 15 European central banks to limit gold sales and lending and on the fact that US interest rates are rising, as are fears of inflation. All these factors would lead to the gold price rising, he told delegates at a Sydney Mining Club lunch. But Mr Loney said he did not expect Australian producers to follow Placer Dome's lead as regards hedging given that with higher cost mines, they need to lock in prices to guarantee their revenue stream. But if the large producers in North America and South Africa believe - like Placer - that the gold price has bottomed out, they would be "very careful" as to what price they would lock in on, he said. Mr Loney noted that many investors in gold companies preferred that the companies take the risk of some exposure to the gold price in order to leave some potential for upside when the price rises. Placer's recent action leaves 85 per cent of its reserves unhedged, he noted. Commenting on Placer Dome's position in the Australian market, Mr Loney said that the company would like to grow its position but that it had a limited exploration budget. It also continues to look at acquisitions, although has nothing specifically in mind, he said. Placer is "very happy" with its 60 per cent stake in the large, low-cost Granny Smith mine in Western Australia, and with the overall performance of its Kidston mine in Queensland, although that mine is due to close in mid-2001, Mr Loney said. AAP 02-03 1952 quote.com