Showing posts with label Goldcorp. Show all posts
Showing posts with label Goldcorp. Show all posts

Wednesday, November 7, 2012

Goldcorp takes Barrick's thunder as top gold miner by market cap

Goldcorp has surpassed Barrick Gold to become the world's biggest gold miner by market capitalisation, even though Barrick owns more mines and produces far more gold than its growth-focused peer.

Goldcorp has been creeping up on Barrick for years, but this is the first time the smaller producer has surpassed the longtime top dog, which is under pressure due to delays and rising costs at its massive Pascua-Lama project, in South America.

"It's not necessarily that Goldcorp is doing so well, it's just that Barrick is doing so poorly," said John Ing, president and mining analyst at Maison Placements Canada in Toronto.

Pascua-Lama, which is now expected to cost up to $8.5-billion to build, will be the most expensive gold mine ever constructed, he said.

"That, together with disappointing earnings reflecting a narrowing of margins, really deflated enthusiasm for the world's so-called leader among the gold miners," Ing said.

Barrick stock has fallen nearly 25% since the beginning of 2012, while Goldcorp stock has been buoyed by better-than-expected third-quarter earnings. Goldcorp is down 3.5% this year.

Goldcorp's market cap was C$35.32-billion ($35.47-billion) at the close on Tuesday, while Barrick's market cap stood at C$35.3-billion. Newmont Mining, the world's second largest gold producer, is worth $23.84-billion.

Goldcorp lags Barrick in output. Toronto-based Barrick expects to produce some 7.3-million to 7.5-million ounces of gold this year, while Vancouver-based Goldcorp plans to produce some 2.35-million to 2.45-million ounces this year.

Barrick, which fired CE Aaron Regent in June amid disappointment with the performance of the shares, also dominates on the operations front, with a stake in some 22 producing gold mines around the world.

Goldcorp, by contrast, holds a stake in 12 producing mines across the Americas, including the Pueblo Viejo joint venture in the Dominican Republic, co-owned and operated by Barrick.

Barrick's shares were up 0.8% at C$35.55 on Wednesday afternoon on the Toronto Stock Exchange. Goldcorp rose 1.1% to C$44.20.

Edited by: Creamer Media Reporter

Sunday, October 28, 2012

Goldcorp lifts quarterly revenue on increased production, sales

Canada’s Goldcorp had reported record revenue during the third quarter ended September 30, on higher production and increased sales at higher prices.

The TSX-listed firm reported that revenue increased by 17.5% year-on-year to $1.53-billion, compared with $1.3-billion in revenue a year earlier.

This was achieved on gold sales of 617 800 oz from production of 592 500 oz. This compared with sales of 571 500 oz on production of 592 100 oz in the third quarter of 2011. The average realised gold price was $1 685/oz of gold sold.

Total cash costs were $220/oz of gold on a by-product basis and $660/oz on a co-product basis.

Silver production totalled 8.5-million ounces, 30% higher than the 6.5-million ounces produced in the prior year's third quarter.

Goldcorp reported net earnings rose by 48% to $498-million, compared with $336-million in the same period a year earlier. Adjusted net earnings were, however, down 2% at $441-million or 54c a share, compared with $450-million at 56c a share.

Operating cash flow before changes in working capital was $687-million, compared with $681-million in last year's third quarter.

"Operating improvements at Red Lake and Peñasquito contributed to strong financial results in the third quarter. Our priority is on continuing work to maximise the strong potential at our two largest operations," Goldcorp president and CEO Chuck Jeannes said.

He said access to several stopes in the high-grade zone of the company’s largest mine, the Red Lake mine, in Canada, followed the completion of destressing work, which had resulted in stronger gold production in the second half of the year. An important new discovery next to the high-grade zone was also made, which supported the potential for greater future production flexibility.

At Peñasquito, Mexico, Goldcorp said there was enough water available to achieve 2012 guidance, and a study was under way to develop a long-term water strategy to meet the needs of both Peñasquito and emerging development opportunities in the Peñasquito district.

"Goldcorp's pipeline of high-quality gold projects comprises the leading growth profile in the sector, and we are pleased that the first of those new growth projects, Pueblo Viejo, in the Dominican Republic, achieved first gold production during the third quarter,” Jeannes added.

Among the company’s noteworthy projects was its Cerro Negro project, in Argentina, which was advancing towards first gold production in late 2013. All major mechanical equipment to be imported had arrived at the site or in the country, and development of the first three veins was progressing well. Based on expected throughput of 4 000 t/d, yearly gold production in the first five years of full production was expected to average 550 000 oz at cash costs of less than $300/oz.

At the Éléonore project, in Quebec, a milestone was reached with the completion of the Gaumond exploration shaft excavation, and at Cochenour, in Red Lake, a new study, including an updated development plan would be completed during the fourth quarter. Both Éléonore and Cochenour remained on track for first gold production in late 2014.

“The low capital cost per ounce of new gold production for these four new projects creates the opportunity for very strong financial returns for our shareholders,” Jeannes said.

The company said it expected to produce between 2.35-million and 2.45-million ounces of gold for the year.

The company’s Toronto-listed stock traded 4.73% higher at C$42.72 apiece on Thursday morning.

Edited by: Creamer Media Reporter

Sunday, September 23, 2012

Goldcorp eyes Mexico joint venture with Fresnillo

The two companies are looking to jointly develop Fresnillo's Camino Rojo gold and silver deposits, adding that a feasibility study is expected to be completed by early next year.

Canadian miner Goldcorp, one of the world's largest gold producers, is considering teaming up with Mexico's Fresnillo to develop a new precious metals venture in the central Mexican state of Zacatecas.

Goldcorp Mexico's business development director, Federico Villasenor, told Reuters that Goldcorp and Fresnillo are looking to jointly develop the Canadian miner's Camino Rojo gold and silver deposits, adding that a feasibility study is expected to be completed by early next year.

Villasenor said both companies had already worked together on geological exploration of the property, but he declined to quantify reserves or expected production.

Camino Rojo is just 31 miles (50 km) southeast of Goldcorp's massive open pit mine at Penasquito.

"As neighbors, it's possible that we can create a synergy between the two companies," said Villasenor.

In addition to gold and silver deposits, Camino Rojo is believed to contain significant deposits of lead and zinc.

Fresnillo is the world's largest primary producer of silver, and is controlled by Mexican mining company Industrias Penoles . Fresnillo is also Mexico's second-largest gold producer.

Villasenor added that the Camino Rojo property is believed to feature a geological profile similar to that of Penasquito, expected to be Goldcorp's top gold-producing mine in Mexico this year.

GOLD PROSPECTING UP

Sustained high gold prices and relatively low Mexican labor costs have propelled increased production as well as added exploration investments over the past 10 years.

"Mexico's exploration expenditures have risen significantly over the last decade, reaching a record high of almost $1 billion in 2011," said analyst Ben Moore of Metals Economics Group.

He added that since 2003, exploration spending in Mexico has grown faster than the world average, boosting the country's global ranking to fourth from eighth.

Goldcorp expects to produce 380,000 ounces of gold from Penasquito this year, down 10.6 percent from the company's previous output forecast of 425,000 ounces.

The company says the downward revision is mainly due to a local water shortage caused by severe drought conditions that began last year.

Last year, Penasquito produced 254,100 ounces of gold.

Gold hit a 6-1/2 month high at $1,779.10 per ounce on Wednesday, before easing off.

"The rise (in prices) over the last few years has been so positive that there's still a fairly large margin" between extraction costs and attractive returns, said Villasenor.

The Penasquito property is currently the world's 35th-largest gold producing mine, and Mexico's second-largest gold mine after Fresnillo's Herradura property in the northwest state of Sonora, according to data compiled by Thomson Reuters GFMS.

Goldcorp also operates the El Sauzal mine, in the northern state of Chihuahua, as well as the Los Filos mine in southern Mexico's Guerrero state.

The company's three existing gold producing-properties contributed a quarter of Goldcorp's international gold production in 2011, or about 2.5 million ounces.

This year, Goldcorp expects to produce between 2.35 million and 2.45 million ounces of gold.

Source: Reuters

Wednesday, September 12, 2012

Rob McEwen: gold should be in your portfolio and it's going to $5,000

In an upbeat presentation at the Denver Gold Forum, Rob McEwen forecast that gold is going to $5,000, while setting out the path forwards for the company which now bears his name - McEwen Mining.

This year's Denver Gold Forum kicked off yesterday morning and one of the early speakers was Rob McEwen of McEwen Mining. He has a great name in the industry due to his long term stewardship of Goldcorp, which was largely responsible for building the gold mining major to the strong position it holds today. Nowadays he runs McEwen Mining - a U.S. headquartered and quoted developing gold producer for which he has the avowed intent of bringing into the S&P 500 by 2015 - and with one gold/silver mine in production, a second just starting up with its first gold pour expected in a matter of weeks, a third in permitting and a very significant copper/gold/silver project at the exploration stage he may be well on his way to achieving this aim.

But it is perhaps as an avowed believer in gold that McEwen attracts a strong following at a conference of this type, perhaps the most significant annual gold event in the calendar- and he opened his presentation with a strong statement of his beliefs in this respect.

"Understand This! Gold is Money" was his opening statement with a strong recommendation that investors should have gold in their portfolios now, before then showing a slide giving his assessment of the loss of purchasing power of all major currencies against gold over the past 11 years of the gold bull market. According to the slide the best performing currency against gold was the Australian dollar which had only lost 68% of its purchasing power vs gold over the period - while the joint worst performers were the U.S. dollar and the South African Rand, both of which had lost 85% against gold. This is one interpretation that can be drawn from the dramatic rise in the gold price over the period But regardless it did serve to make the point that an investment in gold would have served investors well in virtually any currency.

In McEwen's view, currency purchasing power will continue to erode through out of control debt accumulation by virtually all major governments - indeed he showed another chart showing the virtually identical growth performance of gold .against that of the rise in U.S. national debt with government continuing to debase their currencies through their current economic policies.

He also pointed to an interesting correlation between the performance of gold stocks in U.S. Presidential election years and the XAU index invariably falling vis-a-vis gold itself in these years. And, with the actual election date drawing nearer he felt that gold stocks will be due for a revaluation upwards once the political posturing by the two main candidates is over and a recovery into what he sees as a great purchasing opportunity in gold stocks. "Now is the time to commit" says McEwen. "gold is going higher - to $5,000".

McEwen does have a pretty good track record in this respect. One remembers that when gold was sitting at around $700 only a few short years ago, he was adamant that it would soon hit $1,000 when to non gold believers this seemed unlikely, yet only a few short months later the gold price did indeed rise above that level.

On McEwen Mining, which was formed from the merger of Minera Andes - which he described as a gold producer with no growth pipeline - and U.S. Gold - which had a growth pipeline but no production, making an ideal fit, he outlined the path forwards with a planned production growth from its first three mines of almost 3x by 2015 from a current 105,000 oz to 290,000 oz gold equivalent.

All the company's main properties are located in the Americas - one each in the U.S, Argentina, Mexico and Chile, which he felt were all good environments, although he did have some doubts about the prospects for getting profits out of Argentina, the location of the current flagship San Jose silver/gold mine - a jv between McEwen Mining and Hochschild with the latter as operator. But the major growth prospects are the El Gallo silver/gold complex in Mexico - for which the main expansion feasibility study has just been completed - and then Gold Bar in Nevada - a past producer which is moving through permitting with first production as a low cost heap-leach operation due on stream in 2015. Meanwhile, waiting in the wings is the potentially enormous Los Azules copper project in Chile which McEwen claims to be the highest grade major undeveloped copper project in the world and with the 7th largest resource. There may be some creative statistical selection to come up with that particular assessment, but it is, nonetheless a potentially very significant copper project indeed.

But again it is gold that is McEwen's main focus - nowadays tempered with silver which is perhaps something of a change in his viewpoint from his Goldcorp days. He also points out that McEwen Mining has no debt, a young, talented management team, a development strategy that is unfolding as planned and a good production growth profile. And, with a huge personal investment in it, he is putting his money where his mouth is - a sign of real belief in the future of the company which bears his name.

Wednesday, July 11, 2012

Goldcorp lowers full-year production outlook

Goldcorp revised its 2012 gold production outlook lower on Tuesday due to operational problems at its Red Lake mine in Ontario and its Penasquito mine in Mexico.

Canada's second-largest gold miner said it now expects to produce between 2.35-million and 2.45-million ounces in 2012, down from a previous estimate of 2.6-million ounces. The company's second-quarter output fell slightly to 578 600 oz, compared with 597 100 oz in the year-earlier period.

"We are disappointed with reducing production guidance due to operational issues at our two most important mines," CE Chuck Jeannes said in a statement. "Our focus is on addressing these issues promptly and in a manner supporting the long-term opportunities at these key assets."

Total cash cost guidance was revised down $310/oz to $340/oz of gold on a by-product basis, compared with a previous guidance of $250/oz to $275/oz.

The Vancouver-based miner also revised its 2012 silver forecast to 30-million to 31-million ounces, down from a previous estimate of 34-million ounces.

Goldcorp is facing a water deficit at Penasquito, in the Zacatecas state of Mexico, which has limited plant throughput at the mill. The company is drilling wells and looking to increase the volume of water reclaimed from its tailing facility.

Penasquito is now expected to produce some 370 000 oz to 390 000 oz in 2012, compared with previous guidance of 425 000 oz.

At Red Lake, Goldcorp's top producing mine, 2012 gold output is now expected to be 460 000 oz and 510 000 oz, compared with previous guidance of 650 000 oz. Work is under way on previously announced de-stressing cuts to the rock.

The company, which owns projects throughout the Americas, maintained its production outlook for its other mines.

Edited by: Reuters

Wednesday, May 2, 2012

Goldcorp says court suspends Chile project green nod

Goldcorp Canada's No 2 gold miner, said environmental permit approval for its El Morro copper-gold project was suspended by the Supreme Court of Chile.

Sociedad Contractual Minera El Morro, which is 70% owned by Goldcorp and rest by New Gold, suspended all field work at the project, the companies said.

The permit was cancelled on Friday on the grounds that the environmental agency had not adequately consulted nor compensated the indigenous people.

Miners in Chile have been hit by protests by indigenous communities demanding stricter environmental protections and wider distribution of the benefits of a long mining boom.

Goldcorp had approached the Supreme Court against the striking down of its permit by a lower court in February. The approval for the permit was issued on March 14, 2011.

El Morro, which holds reserves of 6.1-million pounds of copper and 8.4-million ounces of gold, is expected to cost $3.9-billion to develop.

The companies will meet with environmental officials to confirm the scope of permitted activities pending compliance with the court's decision.

The company's shares, which have fallen over 5% since it reported its a lower profit last week, closed at C$38.38 on Friday on the TSX.

Thursday, April 26, 2012

Red Lake troubles cost Goldcorp production but revenues still up 11%

Lower ore grades at its flagship Red Lake Mine in Ontario did not prevent Goldcorp (TSX:G) from achieving a $479 million profit in the first quarter.

Despite producing and selling less gold than the first three months of last year, the world’s second biggest gold miner posted revenues of $1.3 billion, an 11% increase from the first quarter of 2011. Silver production was up by half a million ounces compared to the same period last year.

Explaining the lower gold production (524,700 oz vs 637,000 oz in Q1 2011), Goldcorp CEO Chuck Jeannes said “Solid operating results throughout most of our mine portfolio were offset by a challenging first quarter at Red Lake.”

“Adverse ground conditions at Red Lake delayed the development of new mining faces in the High Grade Zone which, taken together with lower grade in other areas of the mine, led to our slow start to 2012.”

Gold production at the mine fell to 114,200 ounces compared to 186,100 oz in the first three months of 2011. Produced gold was also down at the Musselwhite mine, Los Filos, El Sauzal, Marlin, and Alumbrera, but up at the Wharf mine, Marigold, Peñasquito and Porcupine.

The company with mines and exploration projects in Canada, US, Mexico, Guatemala and Argentina said it is targetting 2.6 million ounces of gold production in 2012 at cash costs of $250-$275 per ounce.

Goldcorp stock rose 1.35% to close at $40.40 on Wednesday, clawing back some of the value lost earlier in the week when G closed down 3.3% and nearing the 52-week low of $39.12.