Resolute adds to US hedgebook
PERTH (miningweekly.com) – Gold miner Resolute Mining has forward sold an additional 36 200 oz of gold at an average price of $1 562/oz, which will be delivered monthly at a rate of 1 200 oz between July and December this year, with 5 000 oz a month to be delivered between January and June next year.
MD and CEO John Welborn on Monday said that the company was taking advantage of market volatility and the current gold price strength to incrementally extend its US dollar denominated gold hedge position.
“Incremental expansion of our US dollar hedging position at current levels, which are significantly above our budgeted gold price, protects and supports Resolute’s revenue and cash flow. As we seek to expand our existing low-cost senior revolving syndicated loan facility, our hedging programme has strong support from our syndicate banks as our modest hedge book protects the company’s balance sheet and supports a portion of our future revenue and cash flow.
“With long mine lives, large gold inventories, and an industry leading production growth profile, Resolute remains strongly leveraged to future upside in gold prices.”
Resolute’s US dollar forward sales programme now consists of 77 800 oz, sold at an average price of $1 522/oz. The company’s total gold hedge book currently stands at 215 000 oz out until June 2021, representing less than 3% of its total ore reserves.
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