Hedging/Derivatives

 

The Group’s policy is to remain unhedged to the gold price.  However, hedges are sometimes undertaken on a project specific basis as follows:

  • to protect cash flows at times of significant expenditure;
  • for specific debt servicing requirements; and
  • to safeguard the viability of higher cost operations.

Gold Fields may from time to time establish currency financial instruments to protect underlying cash flows. 

  South Africa forward cover contracts*
 

South African rand forward cover contracts were taken out to cover commitments of the South African operations in various currencies. Outstanding at the end of September 2012:

  • AUD1.5 million with a mark to market value of USD0.01 million
  * Do not qualify for hedge accounting and will be accounted for as derivative financial instruments in the income statement.
  Australia - Diesel hedge*
 

St Ives Gold Mining Company (Pty) Ltd entered into a Gasoil 10PPM FOB Singapore contract for 10,000 barrels per month effective 1 August 2012 until 31 January 2013 at a fixed price of USD118.90 per barrel. Outstanding at the end of September 2012:

  • 50,000 barrels with a mark to market value of USD0.6 million
  * Do not qualify for hedge accounting and will be accounted for as derivative financial instruments in the income statement.