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Gold/Mining/Energy : Pacific Rim Mining V.PFG -- Ignore unavailable to you. Want to Upgrade?

To: Quickdraw who wrote (8169)	12/14/1997 2:17:00 PM
From: Shirley Owen	Respond to of 14627

An interesting article from Reuters on Central Bank selling, etc. I quote: In industry news, the Swiss National Bank (SNB) confirmed it had started lending gold on November 1, after new laws allowed it to more actively manage it's reserves. Last month the Bundesbank also confirmed it had joined the ranks of central banks lending gold. But the Swiss National Bank also said it will not reduce its gold stocks quickly, if proposed amendments to the Swiss constitution and SNB laws are approved, allowing the Swiss franc gold standard to be removed. Earlier this year a panel of government officials proposed Switzerland should sell some of its gold to fund the Solidarity Foundation Holocaust victims fund, and improve returns on the SNB's reserves. "We do not intend to reduce our gold stocks quickly," SNB vice-chairman, Jean-Pierre Roth said. "We are convinced that gold will continue to play a role as a currency reserve, especially in times of crisis. We therefore intend to continue to maintain significant gold reserves," he said. "Those who expect massive gold sales from us will be disappointed." Dutch, Australian, and Argentine central banks sold about 600 tonnes of gold in the past 12-18 months, equivalent to about 25 pct. of annual world gold mine production. "Gold demand should grow about six percent per annum and production is likely to be flat next year," said Harvinder Kalirai, an analyst with New York consultants IDEA. "This in itself would be bullish, but as over the last year, further central bank sales will keep the demand/supply picture bearish, as only 130 tonnes of sales, just one fifth of that seen from three central banks this year would keep demand and supply in balance." Meanwhile, gold production is beginning to feel the impact of the slide in gold prices. In the U.S. Getchell Gold (Toronto:GGO.TO - news) said this week it was trimming production to conserve cash as a result of lower prices and would lay off 20 pct of its staff. In Australia, Goldfields Kalgoorlie Ltd (AMEX:gkl - news) this week said lower gold prices had reduced the life of its Paddington mine in Western Australia to 18 months. Last month Pegasus Gold Inc (AMEX:PGU - news; Toronto:PGU.TO - news) closed its Mt Todd mine in Australia's Northern Territory. Australian gold miners had the world's highest cash operating costs in 1996, according to industry consultants, Gold Fields Mineral Services. "The price of gold has been pushed so far below the average cost of production that mines are operating at a loss and continue to close, which will place pressure on supply," said Kjeld Thygesen, manager of gold equities fund, Midas. COMEX March silver futures ended up 6.8 cents at $5.878 an ounce, after trading a $5.760-$5.960 range. In the bullion market, spot silver fixed at $5.7850 an ounce in London Friday, after seeing the highest level since March 1989 earlier this week. The silver forward price curve was also back in contango Friday, after seeing a brief backwardation earlier this week. NYMEX January platinum closed off 20 cents at $360.20 an ounce, after seeing their lowest levels since February earlier this week, while NYMEX March palladium lost $6.00 to $199.25, a four week low.