Goldcorp Inc. (GG) announced that it has set aside the full rehabilitation cost for its Eleonore gold mine in northern Quebec.
Goldcorp has secured $40.1 million to cover 100% of the closure obligation associated with the Eleonore mine site. This represents the company’s commitment to sustainability as well as government, stakeholders and the communities where it operates. The estimated closure costs were chalked out by a group of stakeholders, including government officials, who examined the full cost of implementing mine closure plans in case a third party was to take on closure work in sync with regulatory requirements.
The Eleonore mine is expected to commence production in late 2014. Goldcorp expects gold production in 2014 to be in the band of 40,000 to 60,000 ounces. Average annual gold production, once the mine reaches full production, is expected to be about 600,000 ounces. Gold reserves are expected to be 4 million ounces. Total capital expenditure is expected to be between $1.8 and $1.9 billion. Roughly $1.3 billion has been already spent towards the completion of the project.
Goldcorp made the announcement at the Prospectors and Developers Association of Canada annual conference in Toronto at an event hosted by the Minister of Natural Resources of Quebec.
Recently, Goldcorp released its fourth quarter 2013 results. The company’s adjusted earnings (barring one-time items) of 9 cents a share missed the Zacks Consensus Estimate of 23 cents and was well below 57 cents a share in the year-ago quarter.
Net loss, as reported, in the quarter was $1.1 billion or $1.34 per share compared with net earnings of $504 million or 47 cents per share a year ago.
Goldcorp posted revenues (as adjusted) of $1,203 million in the quarter, down 16.2% year over year. The company missed the Zacks Consensus Estimate of $1,242 million. Average realized gold price for the reported quarter declined 25.9% to $1,254 per ounce from $1,692 per ounce in the prior-year quarter.
Goldcorp currently carries a Zacks Rank #3 (Hold).
Other companies in the mining industry with a favorable Zacks Rank are AngloGold Ashanti Ltd. (AU), Lake Shore Gold Corp. (LSG) and Pretium Resources Inc. (PVG). While AngloGold carries a Zacks Rank #1 (Strong Buy), Lake Shore Gold and Pretium Resources maintain a Zacks Rank #2 (Buy).