kickin' it in the kyrgyz, page-10

Main issue in this instance IMO Macduff is hedging is expensive. I presume that you are proposing a Put option arrangement. From memory (check back over the announcements) PRU spent 10m for a Put option over 150-200k oz gold about $100/oz under the price at the time (1100ish). The reason they did this was MQB pushed hard as part of their debt funding (80m odd). PRU were careful to ensure they minimised the volume and also chose a put option to avoid the risks of project delay etc - I doubt they would have done it otherwise.

In MSRs case, CAPEX for Shambesai is small (16-20m) and another 10m on top would be crazy. Additionally they probably have sufficient cash already (allowing for MSRO conversion) to not need either a CR or Debt so have no need to derisk the project just for the sake of the market. Personally I reckon the very best way to derisk MSR is for management to get Shambesai into production ASAP. The cashflow from there will fund extensive exploration and shield MSR from any capital/equity market downturns or even a crash in POG.