Gold miner Goldcorp details growth plan, shares rise
By Nicole Mordant
VANCOUVER (Reuters) - Canadian gold miner Goldcorp Inc detailed an ambitious growth plan on Tuesday that includes increasing production as well as yet-to-be-mined reserves by 20 percent over the next five years from existing operations and deposits, lifting its shares.
At an investor day event, the Vancouver-based miner focused on the exploration potential at its mine sites and projects in the Americas, a turnaround from recent years when most miners' attention was on reducing costs, not growth.
"Growth is not as dirty a word as it was a couple of years ago," Goldcorp Chief Executive David Garofalo said, warning that the gold industry risked becoming irrelevant if it did not reverse a trend of falling output and reserves.
Goldcorp late on Monday said it expected to increase gold output by a fifth over the next five years to about 3 million ounces, driven by capacity ramp-ups at its Cerro Negro mine in Argentina and the Eleonore mine in Canada.
Its gold reserves are forecast to rise 20 percent to 50 million ounces in the same period from the conversion of existing resources at its Century project in Ontario, Peñasquito mine in Mexico and Pueblo Viejo mine in the Dominican Republic.
Goldcorp forecast its all-in sustaining costs - the industry benchmark - falling by 20 percent to $700 an ounce by 2020.
"It is this long-term strategy of rising production and falling costs, with a focus on key current assets, that has us very excited about the future of Goldcorp," Desjardins analyst Michael Parkin said in a note to clients.
In late afternoon trading, Goldcorp's shares were 3.4 percent firmer at C$19.82 on the Toronto Stock Exchange, outperforming the S&P/TSX Gold Index, which was up 1.7 percent. Continued...