By Maria Luisa Palomino
LIMA (Reuters) - Buenaventura (BUEv.LM: Quote, Profile, Research, Stock Buzz), Peru's No. 1 precious metals producer, expects "no great variation" in the price of gold this year, which it sees averaging $600 an ounce, below its current price on world markets.
Speaking at the Reuters Latin American Investment Summit on Friday in Lima, Buenaventura (BVN.N: Quote, Profile, Research, Stock Buzz) Chief Executive Roque Benavides also said he saw silver prices averaging between $12 and $15 an ounce.
On his gold price outlook for 2007, he added: "I don't think there is going to be a great variation." Gold closed in New York at about $657.30 an ounce after falling about 1 percent from a three-week high on Thursday.
"I say it will be in the order of $600 (an ounce average for 2007)," he said. "I don't see gold at $1000 an ounce, nor do I see it at $400 an ounce. I think it will maintain itself at what is a very reasonable price."
Peru is the world's No. 5 gold-producing country and ranks among the two top producers of silver, which on Friday dipped to around $13.79 an ounce on world markets.
GOLD OUTPUT
Benavides said the company expects its 2007 gold output to be 1.1 million ounces, down from 1.545 million ounces last year. For 2008, he saw 1.2 million ounces in output.
The forecasts include output at Yanacocha, South America's biggest gold mine, where production has been declining due to lower ore grade among other factors.
Buenaventura owns 43.65 percent of Yanacocha, while the majority stake is owned by Denver-based Newmont Mining Corp.
(NEM.N: Quote, Profile, Research, Stock Buzz).
This year's silver output at Buenaventura, one of a handful of Peruvian companies traded on the New York Stock Exchange, is likely to be similar to its 15.5 million ounces in 2006, Benavides said.
As for the Cerro Verde copper mine, Benavides expected 2007 output of up to 280,000 tons. The mine produced 100,573 tons in 2006, the company said. Buenaventura has a minority stake in Cerro Verde, which is majority owned by U.S.-based Freeport-McMoRan Copper & Gold Inc. (FCX.N: Quote, Profile, Research, Stock Buzz)
FOREIGN HORIZONS?
Outside of Yanacocha, Benavides said, "We expect to be able to raise (non-Yanacocha gold output) between 5 and 10 percent this year at a minimum."
The company said its non-Yanacocha gold output was 405,383 ounces in 2006. Continued...
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