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It appears that this company is feeling the pinch of a low share price and has acted accordingly. This statement on hedging was purposeful in that they are stating openly that they have broken the shackles of their financiers! As a side issue good profit figures posted as well -

Expect a small retracement in the PoG before another spike ... Note that these spikes will definitely give the money men in the mining companies palputations!!


NDY - ASX Company Announcement
$gol1
16 February 2000
Part 1/1
--------
NORMANDY MINING LIMITED
-----------------------
HOMEX - Adelaide
-------------------------
Statement on Hedging
Normandy Mining Limited is a strong advocate of hedging disclosure.
The policy was first published in the 1990 Annual Report, and hedge positions and marked-to-market values disclosed on a quarterly basis from September 1994 and December 1997 respectively. Hedging has been
conducted in a prudent manner and in moderation - in strict adherence to our publicly stated policy.
At present, there is no need, and at the current gold price, no intention to conduct further hedging as 60 percent of reserves (conservatively stated) are covered. Normandy continues to deliver into existing hedge positions, although at current prices with a
predominance of options, this is increasingly into the spot gold market.
Future hedging will be primarily influenced by development decisions to guarantee cashflow particularly through the project finance payback period.
Normandy has demonstrated its confidence in the gold price on at least five occasions in the last two years. Specifically, Normandy has:
* Repaid (bought back) the final outstanding gold loan - 280,000
ounces (December 1997)
* Restructured the hedge book, realising $650 million in a tax
effective manner (February 1999)
* Repaid (bought back) 500,000 ounce gold Notes - four years early
(July 1999)
* Maintained a substantial gold exploration budget for 1999/00 (July
1999), and
* Continues to transition the hedge book to options (February 1999 to
present).
Today with the transition in the hedge book to options, 56 percent of reserves participate in positive gold price movements. With resources, a high percentage of which are expected to be converted to
reserves, 86 percent participate in positive gold price movements.
Major North American and South African gold companies have recently commented on their short term hedging intentions. Australian companies were among the first to develop hedging activities and accordingly have substantial amounts of gold hedged.
Normandy believes the interests of Australian gold producers would be best served by giving consideration to strategies that minimise the impact of hedging activity and limit the quantum executed in any
given time frame.
With the majority or central banks and gold producers identifying their intention, Normandy also calls on bullion banks, when acting as principal, and hedge funds trading in gold, to also make their intentions clear in the interests of market transparency.
R J Champion de Crespigny
EXECUTIVE CHAIRMAN
Enquiries concerning this report may be directed to:
C G Jackson, Group Executive - Corporate
100 Hutt Street, Adelaide 5000
South Australia, Australia
Telephone: +61 8 8303 1703 Facsimile: +61 8 8303 1994
This announcement and other previous announcements are available at Normandy website: http://www.normandy.com.au
ends - AAP
16-02 0956
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