Gold News

31/08/07: Gold mining strikes raise bullion prices

Strikes occurred today (August 31st) at the huge Lihir gold mine in Papua New Guinea, provoking a rapid reaction on the gold market.

The price of the precious metal rose to $666.30/667.10 per ounce on the New York mercantile Exchange this morning, after having fallen below $665 late on Tuesday.

Investors banked on the Papua New Guinea strikes continuing unresolved for a considerable time, consequently foreseeing an interruption to supply as an incentive to pounce immediately.

The decision to buy up gold as soon as possible sent its price upwards after a combination of weakness in the equities market and a stronger dollar had kept it low.

The Lihir mine, dug out of a dormant volcano on Lihir Island, is one of the world's biggest gold mines, with company forecasts showing an expected production of between 800,000 and 830,000 ounces for 2007.

Reasons for the strike remain as yet unclear, but reports from the Mining Journal suggest that Lihir is confident of resolving the problems on site.


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