JOHANNESBURG (miningweekly.com) - Embattled Tanzania-focused miner Acacia Mining has bought additional put options covering 120 000 oz of gold at a strike price of $1 320/oz at a cost of $2-million.
The options would expire in equal instalments of 30 000 oz a month between March and June.
These options, in addition to those bought in September 2017 at a strike price of $1 300/oz, provide a minimum price for the majority of the group's expected production for the first half of this year, above its budgeted gold price of $1 200/oz, with full upside exposure should the gold price continue to trade above the respective strike prices.
The company last month said it had scaled down its operations, driven by "unsustainable cash outflows at the mine as a result of the copper and gold concentrate ban and the operating environment".
Acacia remains in a dispute with the Tanzanian government, which banned the export of unprocessed minerals in March last year and enacted new laws to raise State ownership of the country's mines.