Lihir Gold Limited's (Lihir Gold) production and average grade recovery declined in 3Q 09, although the company is still expected to meet its full-year production targets. We expect gold prices to appreciate further during FY 2010, supporting the company's top-line. Therefore, after the recent moderation in the ADR price, we now see upside potential and upgrade the ADR from a HOLD to a BUY for the coming 6-12 months. We will reassess our ADR (1 ADR = 10 Australian shares) rating for Lihir Gold after it releases its FY 2009 results in February 2010. We now anticipate a positive currency impact on the Australian stock over the coming 6-12 months. Therefore, we upgrade the Australian stock from a HOLD to a BUY rating. We will reassess our Australian stock rating for Lihir Gold after it releases its FY 2009 results in February 2010.

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