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Unformatted text preview: sed to changes in energy prices through its consumption of diesel and other fuels, and the
price of electricity in some electricity supply contracts. The Company entered into energy forward contracts that
protect against the risk of fuel price increases. Fuel is consumed in the operation of mobile equipment and
The following table provides a summary of energy forward contracts outstanding at December 31, 2012,
Oil forward buy contracts (barrels)
Diesel forward buy contracts (gallons)
Gasoil forward buy contracts (tonnes)
Average price 2013
906.30 2014 2015 175,000
894.21 During 2012, the following new forward buy derivative contracts were engaged: 498,000 barrels of Nymex Crude WTI oil at an average rate of $92.66 per barrel, with maturities in 2012,
2013, 2014 and 2015; 5.25 million gallons of diesel at an average rate of $2.92 per gallon, with maturities in 2012, 2013 and
2014; and 56,364 tonnes of gasoil at an average rate of $894.21 per tonne, with maturities in 2013 and 2014. At December 31, 2012, the unrealized gain or loss on these derivative contracts recorded in AOCI is as follows: Oil forward buy contracts – unrealized gain of $0.9 million (December 31, 2011 – $1.8 million gain); Diesel forward buy contracts - unrealized loss of $0.2 million (December 31, 2011 – $0.3 million loss); and Gasoil forward buy contracts – unrealized gain of $1.3 million (December 31, 2011 – $0.2 million loss). (v) Total return swap
A total return swap (“TRS”) was engaged during the fourth quarter of 2008 as an economic hedge of the
Company’s DSUs. Under the terms of the TRS, a bank has the right to purchase Kinross shares in the
marketplace as a hedge against the returns in the TRS. At December 31, 2012, 91% of the DSUs were
economically hedged, although hedge accounting wa...
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This document was uploaded on 03/30/2014.
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