20 percent devaluation of U.S. dollar is reported proposed for G7 meeting

Section:

By Nicole Mordant
Reuters
Sunday, September 26, 2004

http://yahoo.reuters.com/financeQuoteCompanyNewsArticle.jhtml?
duid=mtfh64626_2004-09-27_00-11-59_n26656630_newsml

DENVER -- Rattled by a spate of high-profile mining
disruptions on several continents this month, gold
stock investors are looking to company bosses to
reassure them that their investments are safe.

Institutional shareholders who have watched
Newmont Mining Corp. battle pollution accusations
in South America and Asia and Canadian explorers
forced to freeze projects in Africa will get a chance
to demand answers from the world's largest miners
at a conference that starts on Monday in Denver.

"The risks associated with permitting and political
events seem to be on a steep rise," said Michael
Fowler, a mining analyst at Desjardins Securities
in Toronto.

"Things like what's going on with Newmont right
now with people being detained in Indonesia and
the pollution of rivers, that's certainly an issue,"
Fowler said on the eve of what is regarded as
one of the most important annual gatherings on
the gold industry's calendar.

Newmont, the world's No. 1 gold producer, is one
of about 65 big, mostly gold but also silver and
palladium miners presenting at the invitation-only
forum for 450 fund managers, mining executives,
and analysts in the mile-high city at the foot of
the Rocky Mountains.

Denver-based Newmont has made headlines
around the world and its stock lost 5 percent in
recent weeks as Peruvian farmers accusing it
of polluting local water blocked access to its
Yanacocha mine, its second biggest gold
operation.

At the same time, police in Indonesia have
detained Newmont executives in that country for
questioning about claims by local residents that
one of its mines has polluted a bay.

In East Africa, Eritrea ordered four Canadian
exploration firms to pack up their work without
any explanation. Nevsun Resources, one of the
casualties whose stock has since lost half its
value, will present at the show. Buenaventura,
Newmont's Peru-based partner at Yanacocha,
will also be on the podium.

But analysts don't expect only doom and gloom
at the three-day affair, where deals have often
been struck behind closed doors in the 14 years
that the show has taken place.

Institutional demand for gold as an investment has
increased and the bullion price, once again above
$400 an ounce, is near its best levels in a decade
and a half.

"At least we are fortunate in that we are in a positive
spin on the gold price now. We might end up with a
pretty buoyant attitude down there in which negativity
isn't going to be the key issue," said Mark Smith,
an analyst at Dundee Securities in Toronto.

Miners from North America, Australia, or South Africa
are likely to use the opportunity to make
announcements on exciting new mineral finds at a
time when gold production and reserves around the
world are sliding.

"The big companies will try to outdo each other on
exploration news. ... They will want to say 'we are
big but we can keep growing,'" said Patrick Chidley,
a mining analyst at Barnard Jacobs Mellet in New
York.

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