Derivatives used as Hedging Instruments

6 Months Ended

Jun. 30, 2016

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities Disclosure [Text Block]

8. Derivatives used as Hedging Instruments

 

During the six months ended June 30, 2016, the Company entered into a series of “zero-cost put/ call” collar contracts for gold with settlements scheduled between June 30, 2016 and December 30, 2016 with an average floor price of $1,100 per ounce and an average ceiling price of $1,320 per ounce. These derivative instruments were not designated as hedges by the Company and are recorded at their fair value at the end of each reporting period with changes in fair value recorded in the statement of loss and comprehensive loss.

For the three and six months ended June 30, 2016, the Company recorded an unrealized derivative loss of $215,365 and $321,634 (Three and six months ended June 30, 2015 - $Nil and $Nil) in the statement of loss and comprehensive loss on these contracts.

The following is a summary, by maturity dates, of the Company’s gold collar contracts outstanding as at June 30, 2016:

	2016
Gold zero cost collars:
Floor amount (ounces)		6,000
Average floor price	$	1,100
Ceiling amount (ounces)		6,000
Average ceiling price	$	1,320

The unrealized fair value of these contracts at June 30, 2016 was a liability of $321,634 (December 31, 2015 - $Nil).