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Gold/Mining/Energy : Precious and Base Metal Investing -- Ignore unavailable to you. Want to Upgrade?

To: dara who wrote (20582)	9/17/2003 8:28:34 AM
From: TheSlowLane	Read Replies (1) \| Respond to of 39344

dara - thanks for posting the Embry interview, you are right, it was worth watching. Here is a newswire piece regarding Newmont's view of the market. Note the comments on consolidation in the industry. We'll see what gets announced during the Denver conference... Newmont sees "substantial" gold price potential Reuters, 09.16.03, 11:27 PM ET ADVERTISEMENT E-Mail Alerts Topics Latin America Gold Mines Gold Gold and Precious Metals Enter E-Mail Address: FAQ \| Privacy Policy Mortgage Services from Homebound Mortgage Apply For A Mortgage Today’s Mortgage Rates Home Equity Mortgage Calculator Free Credit Report FHA & VA Mortgage Loans Buyers Calculator How Much Can You Borrow? Should I Refinance? Low Home Equity Rates Please enter your name and email to begin: Name: Email: Click 'Continue' to complete your subscription order. eLibrary @ Forbes.com more > Research topics related to this story in the eLibrary news and magazine archives. Latin America Gold Mines Gold Gold and Precious Metals By Mary Powers AREQUIPA, Peru, Sept 16 (Reuters) - Newmont Mining Corp sees a substantial possibility of higher gold prices but will continue to develop low-cost mines and cut debt to hedge against any future price fall, its chairman said on Tuesday. Wayne Murdy also said Newmont, the world's largest gold producer, expects to make some announcements next week on "exciting" capital investment projects in the pipeline. "We think the environment is very good for a strong gold price," Murdy told Reuters in an interview at a mining conference in this southern Peruvian city. Asked if he shared the view of Newmont President Pierre Lassonde that gold would hit $450 an ounce over the next year, Murdy said: "I don't predict prices but we feel the trend is that there's still substantial upward possibilities" for the price. Spot gold was trading at $373 an ounce at 0300 GMT on Wednesday. Murdy said continuing declines in output worldwide and an extended dearth of exploration were among factors that bode well for higher prices. Low interest rates and a weaker dollar were also boosting prospects for the price, he said. Murdy said that despite the upward trend in the price, producers should try to develop low-cost operations, maintain a strong balance sheet and invest in projects with a good rate of return to protect profits in times of depressed gold prices. Newmont was paying down debt aggressively in order to reach its goal of a 10 percent debt-to-capitalization ratio, he said. MORE CONSOLIDATION POSSIBLE On the possibility of acquisitions, Murdy said there was room for consolidation because the gold industry remains "very fractured." "You end up with better investment decisions in that environment," he said. Newmont bought Australia's Normandy Mining last year, and another takeover battle is brewing in the industry. Randgold Resources Ltd could make a formal offer for Ghana's Ashanti Goldfields Company Ltd as early as this week, sources close to the situation said on Friday, stepping up a bidding war with South African giant AngloGold Ltd. The trend in the future will be toward fewer, larger mines as companies will be required to assume "the full costs of mining, including the environmental and social (aspects)," he said. Newmont operates Minera Yanacocha in Peru, the crown jewel of its properties worldwide. It has invested heavily in the northern region of Cajamarca, where the mine is based. Murdy said Newmont "looks at everything, all the time" for potential acquisition targets. Nevertheless, Newmont's strategy has always been "to spend enough on exploration to grow the company from the drill pit because we can control that." Murdy said Newmont would make a decision by year-end on two low-cost projects in Ghana, where he said Newmont had carried out "a very successful" exploration program over the last couple of years. "They have the potential, from what we see now from our exploration results, to be a very significant producing segment for Newmont," he said. "It's very exciting right now but we haven't put out any public information on it ," Murdy said. "Next week we're going to talk about some of the projects we have and the organic growth we have in front of the company." The information on the projects would be made during the Denver Gold Group Conference, a major investment forum for the industry, he said. Copyright 2003, Reuters News Service