3rd Feb 2020 15:25
(Alliance News) - Taseko Mines Ltd on Monday said it has acquired copper put options to protect a minimum price for its 75% share of production from the Gibraltar mine in Canada over the next three months.
A put, or put option, is an option which gives the owner the right to sell at an agreed price on or before a particular date.
The put options have a strike price of USD2.60 per pound and cover 22.5 million pounds of copper over February, March and April. They were acquired in mid-January at a cost of less than two US cents per pound, the copper company said.
Stuart McDonald, president of Taseko, said: "Our strategy has been consistent since 2009; acquire out-of-the-money put options on an opportunistic basis to protect a minimum copper price for a portion of our production. This strategy has served us well in the past and protects our cash flow against short-term copper price volatility like we've seen over the last two weeks. While the medium to long-term view on copper remains bullish, a conservative approach to managing price risk on the downside is an important aspect of running the company."
Taseko Mines shares were in London on Monday, last closing at 45.00 pence per share.
By Tapan Panchal; [email protected]
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