Barrick says it is reducing hedges too

9:13a ET Tuesday, September 17, 2002

Dear Friend of GATA and Gold:

Here's news we had been disappointed not to
see earlier: Newmont Mining plans to close
its Normandy hedge position by February. And
how interesting that Newmont should announce
this just as an easing of war fears should
knock the gold price down overnight. Could
this timing be a counterblow by Newmont in
support of gold against its enemies? We'd
sure like to hope so, since Newmont's full
mobilization in support of the gold cause
would have great impact.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.

* * *

Newmont Mining to end hedging by February

LONDON, Sept 17 (Reuters) -- Australian gold
producer Normandy, owned by world number one
gold miner Newmont Mining Corp., on Tuesday
said Newmont would eliminate its hedge book
by February next year.

quot;Newmont has completed a restructure of its
hedge book, reducing total hedging by 1.1
million ounces since 31 December 2001, and
has implemented a new hedging policy that
will result in elimination of the company's
remaining hedge book of 300,000 ounces by
February 2003,quot; the firm said in a statement
released in Australia.

The news was supportive for gold prices as
hedging -- or the forward selling of gold by
producers to lock in profits -- is seen by
many analysts as a cap on prices as selling
forward increases supplies into the market.

quot;The amendment to the hedging policy was
considered appropriate in light of the
company's improved balance sheet and the
improved outlook for the gold price. It is
unlikely that additional hedging will be
undertaken in the near future,quot; Normandy said
in the statement.

Normandy said the reduction in the hedge book
since 31 December 2001 had been achieved by
the selective buyback of 700,000 ounces on a
cash neutral basis and delivery of all sales
into existing contracts (400,000 ounces).

This had left 600,000 ounces hedged at 31
August, which included 300,000 ounces ounces
of hedging inherited in the acquisition of
Otter Gold Mines Limited, Normandy said.

The remaining 300,000 ounces of Newmont hedge
contracts will be delivered into over the
next six months.

The remaining 300,000 ounces in the Otter
Gold Mines hedge book would be reduced as
opportunities arise, Normandy said.

Newmont had already committed itself to
accelerate the unravelling of millions of
ounces of gold pre-sold at fixed prices.

The mining house had already extinguished
some two million ounces of a total 10 million
ounces inherited with the takeover of
Normandy in February this year.

Newmont, which forecast gold production of
over seven million ounces this year, is among
a growing legion of big miners with an
aversion to hedging -- the practice of
selling yet-unmined nuggets at fixed prices.

Newmont has criticised hedging as hurting the
gold price by erecting a false ceiling on
upward price movements.

However, some firms defend hedging as a way
to protect margins when bullion prices fall.

----------------------------------------------------

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----------------------------------------------------

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