Future Barrick chairman says would consider hedging
TORONTO Dec 4 (Reuters) - The incoming chairman of Barrick Gold Corp said on Wednesday he would consider a hedging strategy, given volatility in the price of gold, but this did not mean Barrick was poised to change tack on the issue.
Thornton, the former second-in-command at Goldman Sachs Inc , was named co-chairman of Barrick in June 2012. He will take over as Barrick's sole chairman when founder Peter Munk steps down from the board in the spring.
"As an outsider, I always thought it made great sense to hedge, given the background I come from. I can't imagine why you wouldn't look at that seriously all the time," Thornton told reporters at Barrick's headquarters in Toronto.
"Doesn't mean you would necessarily hedge. But I can't understand for the life of me why that wouldn't be an active topic (you'd) be carefully following at all times. Given the characteristics of a commodity like this, it just makes sense to me."
Barrick raised more than $5 billion in 2009 to unwind its fixed-price hedge book to take full advantage of rising gold prices. The company has since maintained a strong no-hedge position, despite the recent decline in the price of gold.
Thornton said that while he would consider hedging, it did not necessarily mean he would push Barrick back toward it.
Gabelli Gold Fund portfolio manager Caesar Bryan said he was worried by the statement. Gabelli Gold owns Barrick shares.
"I'm not happy that he would say that," Bryan said in response to Thornton's comment. "I'm really surprised he would say that at this point."
Thornton also suggested that copper would continue to play an important role at Barrick, which is the world's largest producer of gold and which stumbled badly in an attempt to add copper to the mix with its C$7.3 billion ($6.83 billion) purchase of Equinox Minerals in 2011.
"We are distinctly positioned over the next decade or two, if we can execute, to take what's been built and not only extend it as the world's leading gold miner, but also to take a very serious look at copper, which we are in and possibly minerals beyond that too," he said.