Zeev's Turnips Patch-No Politics (ZEEV)

[basserdan]

*** The PoG from the Horse's mouth ***

rick ackerman: "There is therefore ample reason to believe that the correction lows could be tested before gold can build a solid launching pad."

hi danno,
had i a shred of modesty it would prevent me from remarking that i hypothesized this very scenario here in the turnip patch yesterday...(g)
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Hi Cat,
And had I the faintest glimmering of human kindness, I prolly wouldn't be pointing out that it looks to me as tho you are both wrong at this point. <ggg>

I may come to regret saying that, but if so... I'll just view it as an excellent buying opportunity because I believe the PoG will be higher in the second half of this year than it is now.

Even NEM's less bullish than Lassonde dude says so..... <vbg>


Newmont Looking for Gold Prices to Strengthen in H2, 2004

SYDNEY, May 27 Asia Pulse
- The world's number one gold producer is looking for prices of the yellow metal to strengthen in the second half of 2004.

Gold has fallen by eight to 10 per cent in the second quarter of the year over the first quarter for the past four years before rebounding in the second half, Newmont Australia (ASX:NEM) managing director John Dow told an American Chamber of Commerce luncheon today.

"It's happened every year to varying degrees for the last 15 or so, and the last four have been almost identical to the first quarter of this year," Mr Dow said.

"If history is telling us anything then we should expect to see a seasonal readjustment back up again at sometime in August and September this year, but on the back of very strong fundamentals driving the longer term price."

Gold fell from a year's high of US$426 an ounce on March 31 to US$374 on May 13, before recovering some ground to trade at around US$390 an ounce today.

However, unlike Newmont president Pierre Lassonde, who last year predicted gold would be trading at US$450 an ounce by this August, Mr Dow would only say he expected prices to recover to above US$400.

"I'm not in the business of forecasting (the gold price), I'm in the business of analysing what's driving it," Mr Dow said.

"Our position is that we've been in a period of a short-term dip in the price and we would hope to see it back where it should be during the course of this year."

Corporately, Mr Dow confirmed Newmont has chosen junior nickel producer View Resources from a short list of candidates to negotiate the sale of its mothballed Bronzewing gold mine in Western Australia.

However, he refused to speculate on Newcrest Mining Ltd as a potential acquisition target, and said Newmont was still considering its options for the Golden Grove zinc-copper mine north-east of Perth.

"(Golden Grove's) never been definitely on the block, it's always been something that we've been evaluating what we should do with," Mr Dow said.

The pace of consolidation in the gold industry has slowed and there are no obvious takeover targets left, he said.

"The future for companies like Newmont is in organic growth, that means serious investment in exploration."

Newmont is spending more than US$140 million globally on exploration this year, with A$40 million earmarked for Australia and New Zealand.

"That is a serious commitment to the reserve replacement deficit."

Newmont's exploration focus in the Asian region remains Indonesia, where Mr Dow said the company is a long-term player.

"We have been able to run our business, I don't want to say comfortably, that's not really the word, but we're long-term players in Indonesia, we understand how it works, I think we've earned our reputation there."

Newmont now has a contender for its title as the world's largest gold producer following AngloGold Ltd's acquisition of Ghanaian gold miner Ashanti Goldfields, but did not expect to be eclipsed this year or next.

"We're not unmindful of the importance of that, but it doesn't drive the business, we're more interested really in being more profitable."

Mr Dow, who also chairs the Australian Gold Council, said Australia has not done a very good job of recognising the importance junior explorers play in the overall overall health of the mining industry.

"We had very much hoped in the federal budget to see federal government support for the flow through shares program which did so well for stimulating and the mobilisation of private capital in equity markets in Canada," Mr Dow said.

The Canadian scheme extends tax deductions for exploration expenditure to investors to stimulate the junior end of the market, which has historically been responsible for many significant mineral discoveries.

Mr Dow said there are relatively few small explorers in Australia at the moment, and although there has been plenty of floats in the last 12 months they have generally been small and focused on longer term greenfields opportunities.

"It will be difficult to mobilise private equity into those kinds of speculative activities without some incentive for people to do it," Mr Dow said.

"Flow through shares would have provided that opportunity."

But Mr Dow remained hopeful a flow through shares scheme will eventually be adopted.

"I think we still haven't heard the last word from the government," he said.

"But the industry's disappointed that we didn't see any recognition of the recommendations from the mineral exploration action agenda."

The action agenda was developed by the federal government in 2002 to come up with measures to underpin a continuing, competitive mining industry in Australia.

http://sg.biz.yahoo.com/040527/16/3kmf8.html