Barrick hedges gold to 1999

Already one of the best-hedged gold miners in the business, American Barrick Resources (TSE) recently extended its safeguard against weak gold prices to the end of the century.

Under a deal with banker J.P. Morgan and Co. of New York, Barrick will sell forward up to one million ounces of gold under a new, 10-year hedging facility.

The facility ensures that Barrick will receive about US$450 for each ounce of gold sold forward from production, mainly from mining during the 1996-99 period. Barrick is already fully hedged at US$420 per oz. for gold produced until mid-1995.

Gold recently traded at US$350.25 in New York.

Barrick is expected to produce about 1.2 million oz. this year, up from 790,000 oz. in 1991. At the end of 1991, the company’s reserves stood at about 25.3 million oz. gold.