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ANGLO GOLD CLOSES HEDGE BOOK

The world's third largest gold producer AngloGold Ashanti Ltd has confirmed it will completely close down its hedge book to take advantage of high spot market prices for the yellow metal.

The South Africa-headquartered company's hedge book has dragged down earnings recently, prompting market speculation that new chief executive Mark Cutifani will lead it to a hedge-free position.

Mr Cutifani, who left nickel-focused Vale Inco (formerly CVRD Inco) to join AngloGold Ashanti in September, has long said he is not a fan of hedging and today told AAP that he would run down the company's book to zero.

"We'll make a strategy statement in February about our long term approach ... and will be careful with what we say," he said.

"It will be done through three or four different strategies but by the end of 2008, I would like to see substantial progress.

"The problem is, the market generally sets against you. Its seen as opportunistic."

AngloGold Ashanti operates the Sunrise Dam mine and has stakes in the Boddington and Tropicana mines in Western Australia - the latter considered one of the best gold discoveries in a decade.

It is among many gold producers seeking to close or greatly reduce its hedge book, including the world's top two gold producers - Canada's Barrick Gold Corporation and America's Newmont Mining Corporation.

According to the latest Societe Generale Gold Hedge Book Analysis, the marked-to-market value of the producer hedge book deteriorated by $1.1 billion to total negative $9.1 billion at the end of the September quarter, primarily due to the effects of a 14 per cent increase in the end-quarter gold price.

Shares in AngloGold Ashanti fell 10 cents to $9.35

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Makes you wonder where the gold price is heading when all the world's leading gold producers start closing their hedge books. Go you good thing!