Hedge funds slash bullish wagers on gold over Trump election win
The precious metal has fallen about 8% from a record high on Oct. 31, with losses accelerating after Trump’s election victory last week.
The world’s number two gold producer, Newmont Mining (NYSE: NEM), denied Peruvian press reports claiming the company’s subsidiary Yanacocha was planning to leave the gold-rich northern region of Cajamarca no later than 2016.
In a statement (in Spanish) Yanacocha’s CEO, Javier Velarde, said the company will continue to exploit its gold mine at least until 2015, while it evaluates new projects in the region.
The firm is facing increasing challenges as its Yanacocha gold mine enters the last few years of production and the National Water Authority rejected a proposed expansion plan for it last month.
“We have openly acknowledged the challenges ahead, but we never said the company was leaving Cajamarca by 2016, “said Velarde in the statement.
Denver-based Newmont, in partnership with local miners Buenaventura and Minera Yanacocha, has another project in the area called Minas Conga that has also run into stiff opposition.
Construction of the $4.8 billion gold-copper Conga mine has been suspended for over a year after violent protests and blockades routes in and out of Cajamarca forced the government to declare a state of emergency.
Newmont recently announced that it would nevertheless spend $150 million on Conga this year.
The contentious mining project, designed basically as an extension of nearby dying Yanacocha, is set to begin production in early 2015 and it will generate up to 350,000 ounces of gold and 120 million pounds of copper per annum with a 19-year life of mine.
(Photo courtesy Grufides)
