PERTH (miningweekly.com) – Gold miner Resolute Mining has hedged another 35 000 oz of gold, at an average price of A$1 728/oz, taking advantage of the strong Australian dollar gold price to support the expansion project at its Ravenswood mine.
The miner on Friday said that the additional 35 000 oz is scheduled for monthly deliveries of 5 000 oz between June and December next year.
The average gold price for the additional forward sold gold was at a premium to Resolute’s budgeted gold price for its Ravenswood gold mine of A$1 700/oz, with the new hedging being in addition to the remaining forward gold sales programme of 50 000 oz.
The company’s total gold hedge book currently consisted of 85 000 oz in monthly deliveries out to December 2019, representing less than 20% of Resolute’s expected gold production over this period.
“We actively manage our gold sales and hedging strategies to take advantage of gold price volatility, maximise revenues and protect the company’s balance sheet,” MD John Welborn said.
“Establishing forward gold price certainty for a limited portion of our near-term production during periods of capital intensive development at levels above our budgeted gold price protects and supports the company’s future cash flows and project returns.”
Welborn said that with long mine lives, large gold inventories, and an industry-leading production profile, Resolute remained strongly leveraged to future upside in gold prices.
The gold hedging is expected to protect project returns during the staged development phase of the new 14-year mine life at Ravenswood. The development phase at the mine will see underground mining at Mt Wright come to an end during the current financial year, and the operation transition back to a large scale openpit mine.