gold

Gold miners expect the price of the precious metal to
continue rising in 2012 and are updating their mining plans accordingly,
PricewaterhouseCoopers said Monday.
In its annual Gold Price Report, PwC said that 80% of mining companies
surveyed expect the price of gold to continue to increase this year, with the
majority of respondents expecting gold to peak at $2,000 a troy ounce in 2012.
The survey was based on responses from 40 gold companies representing 26.5
million ounces of gold mined in 2011, and 37.75 million ounces to be mined in
2012.
For 2012 the average price that will be used by executives in their mine
planning is $1,420/oz, compared with $1,130/oz in 2010. The price that
executives plan to apply to their 2011 reserves varies from $850/oz to
$1,650/oz, with 32% applying a price of $1,200/oz.
PwC said that about 62% of the respondents felt that they weren't reaping the
full benefit of the recent gold price increase even though the gold price rise
has had a positive impact on their stock price. The price of gold rose 11% in
2001 until Dec. 15, but gold stocks within the S&P/TSX Global Gold Index had
declined 10.6% in the same period, PwC said. "One main driver behind this
unprecedented disparity between the price of gold and gold stocks is the recent
rise in popularity of exchanged traded funds," said Tim Goldsmith, PwC's global
mining leader.
He noted that ETFs, publicly-listed funds that buy and store the yellow metal
on behalf of investors, provide a simple alternative for those seeking exposure
to the gold price.
Gold companies are seeking to attract more investors by boosting their
dividends and plowing cash into acquisitions, PwC said.