InsideMetals Newsletter - 07/11/2009 | Volume 4, Number 13 - Precious Metals Market Trends, Geopolitical View, Gold Producer News and Website Updates

June 19, 2009: IAMGOLD Corp. (IAG) announced that it has acquired 17%, or 16.1 million shares of Oromin Exploration Ltd. through a private placement. IAG purchased the shares for approximately $0.62 per share, or $9.93 million in total.

June 22, 2009: Compania de Minas Buenaventure S.A. (BVN) reported that operations at the Orocopampa Mine in Peru have resumed following a blockade initiated by locals on June 19, 2009 regarding community, environmental issues and labor claims. Both parties have agreed to discussions to resolve the issues.

June 22, 2009: Coeur d'Alene Mines Corp. (CDE) reported that the U.S. Supreme Court ruled for the company regarding permits issued by the Army Corps of Engineers which allow the company to discharge mine waste from its Kensington, Alaska mine into a lake on federal land. The mine has the potential to produce 125,000 ounces of gold per year, which will increase CDE's gold production by 135% when the mine begins production in the second half of 2010. Kensington currently contains reserves of 1.5 million ounces of gold.

June 22, 2009: Yamana Gold Inc. (AUY) announced that it has been added to the FTSE Gold Mines Index. This index encompasses all gold mining stocks that have a substantial and attributable gold production in excess of 300,000 ounces per year and derives the majority of their revenues from gold mined.

June 23, 2009: Kinross Gold Corp. (KGC) has signed a Letter of Intent (LOI) providing guidelines for an exploration alliance with Canadian Shield Resources Ltd. (CSR) to carry out generative exploration in a designated area of Peru. KGC will provide funding of $500,000 for a 12 month generative program. CSR will be the initial operator of the exploration program which will benefit from a proprietary database acquired by CSR. KGC and CSR may form a joint venture on any project that may emerge from this generative exploration program. Any joint venture that may develop will be owned 50-50 by the parties. KGC will have the option to earn an additional 25% participating interest by spending a pre-determined amount over a two year period.

June 25, 2009: Newmont Mining Corp. (NEM) announced that it has completed the acquisition of the remaining 33.33% interest owned by AngloGold Ashanti Ltd. in the Boddington project. Total consideration for this 33.33% interest was $750 million paid for in cash at closing, and $240 million payable in cash and/or NEM stock in December 2009, and a royalty capped at $100 million, equal to 50% of the averaged realized operating margin exceeding $600 per ounce, payable on one-third of gold sales from Boddington.

June 26, 2009: Gold Field s Ltd. (GFI) provided updated operational guidance for Q4'09. GFI expects its attributable gold production to increase by 4% to approximately 905,000 ounces. Total cash cost for the Group is expected to rise slightly to $525 per ounce. Refer to the press release for details on South African and International Group results.

June 29, 2009: Gammon Gold Inc. (GRS) announced that the company and its current lending syndicate comprised of the Bank of Montreal and the Bank of Nova Scotia have agreed to amend the company's current credit facility that will restore the company's ability to access the undrawn portion of its current $50 million credit facility. Under terms of the revised agreement the current loan covenant breach has been waived and any restrictions that were imposed as a result of the breach have been removed.

June 30, 2009: Hecla Mining Corp. (HL) reported that it has made a prepayment of $18.2 million to its term loan. This prepayment under this fifth amendment to the credit facility, reduces the lending facility to two institutions, reduces borrowing costs, and provides HL with flexibility to control its capital program. The lenders have shown their support by waiving some fees. As of June 30, 2009, HL has now repaid approximately $341.7 million of the $380 drawn on the facilities. The facility was put in place in to fund the purchase of Greens Creek mine in early 2008.

July 8, 2009: Stillwater Mining Company (SWC) reported that it has received notice that General Motors Corp (GM) has petitioned the bankruptcy court to reject the existing Palladium & Rhodium Supply Agreement between GM & SWC. In response the company expects to file an objection with the bankruptcy court and has been in contact with elected representatives. SWC also has supply agreements with Ford Motors Corp. which are much lager than the GM contract. The supply contracts guarantee minimum purchase price for platinum and palladium when prices fall below stipulated levels. These provisions are beneficial to the company in this period of low PGM prices. The company's cash position is strong and they expect to be able to sell its GM production into the market, but would no longer have the floor prices provided by the GM agreement.

July 9, 2009: Stillwater Mining Company (SWC) was placed on a credit watch by Standard & Poor's Rating Services as a result of negative implications arising from the possible loss of contracts with General Motors Corp. as a result of the GM bankruptcy.

July 9, 2009: Kinross Gold Corp. (KGC) reported that unionized workers at the La Coipa mine in northern Chile have gone on strike after talks on a new collective agreement ended. KGC stated that the strike would affect around 300 gold-equivalent ounces per day.