gold up $29au, page-19

Think about it.

why would you buy puts if you entered into a hedge in the same qtr. The only way it would make sense is that your total production is greater than the sum of both the hedge on the puts. ( it is not ie hedge in 1st year is Ie 57+28 = 85 not 75 which is max they will produce at nameplat, Id except that it could make sense if the sum of both amounts is less than or equal to nameplate but again I point out this is 1st year how many gold companies produce nameplate in 1st yr production)you paid 3 million for the right to sell at price X ( normally protecting your downside) but additionally they have hedge for the same period would be crazy especially if the sum of both amounts is greater than what you produce ( which it would be in this case). Why buy the put options if you have the forward sale contracts you have entered into. You must have the gold to sell to these. I know the put is optional but they could have saved themselves 3 Million dollars. What is worse is normally in the 1st & 2nd qtr you ramp up production to nameplate hence I would guess the total amount in these two qtrs is less than annual throughput.