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Investment Risks in Ghana: Avoid Newmont Mines (Instead, Consider Kinross or Agnico-Eagle)
Location is everything for those who invest in mining companies. If a company is operating in a Marxist state that might seize your assets or add punitive taxes on a whim, it's best to not invest. Venezuela just wiped out the value of several mining companies (e.g., KRY) by moving toward nationalization of mines. Investors in Newmont Mines (NEM) should consider the risk posed by Ghana, where 20% of Newmont's reserves are found. The government in Ghana is not one to trust, and all the wealth of that mine must be looking awfully tempting about now. Gold Fields International (GFI) investors should also worry, for 28% of GFI production is in Ghana, not to mention 49% in Marxist South Africa which could get greedy any day. If you own NEM or GFI, I suggest selling and looking for something safer, like Kinross Gold (KGC) or Agnico-Eagle (AEM), as well as Silver Wheaton (SLW).
A hat tip to Casey Research and the Big Gold Report for the info on Ghana.