Toronto Stock
Exchange: G
New York Stock Exchange: GG
All Amounts in $US
unless stated otherwise
Goldcorp Achieves Record Gold
Production in 2007
Further Growth Forecast for 2008
VANCOUVER, BRITISH
COLUMBIA, January 8, 2008 - GOLDCORP INC. (TSX: G, NYSE: GG) announced today that its gold
production in 2007 increased 35% to 2.29 million ounces,
at the high end of its guidance range of 2.2 million to 2.3 million
ounces. Gold production in the fourth quarter of 2007 was a record 633,000 ounces.
Total cash costs for 2007
have not yet been compiled, but are expected to be slightly higher than the
guidance of $150 per gold ounce, due primarily to lower copper prices realized
during the fourth quarter.
"Goldcorp ended the
year with its highest quarterly gold production ever," said Kevin
McArthur, President and Chief Executive Officer. "We believe 2008
will extend our peer-leading growth profile, with gold production expected to
increase 14% over 2007. This growth comes from high quality, long-lived
assets with intriguing exploration potential and strong cash flows. Goldcorp's
business continues to expand substantially - building big mines in safe
countries, with over 80% of its gold production expected from NAFTA countries
in 2008. This impressive value-creation remains unmatched among senior
gold producing companies."
Goldcorp also provided
guidance on production, cash costs and spending for the 2008 year. The
Company expects to produce approximately 2.6 million ounces of gold at a total
cash cost of approximately $250 per ounce. Assumptions used to forecast
cash costs are by-product silver price of $13 per ounce, by-product copper
price of $3 per pound and parity between US and Canadian dollars.
Mine-by-mine gold
production statistics for 2007 and estimated 2008 production are as follows:
Mine
|
2007 Actual Production
|
2008 Forecast
|
Red Lake
|
701,000
|
740,000
|
Porcupine
|
155,0001
|
330,000
|
Musselwhite
|
153,0001
|
240,000
|
Wharf
|
58,000
|
65,000
|
Marigold (66.7%)
|
94,000
|
100,000
|
San Dimas
|
135,000
|
140,000
|
Los Filos/Nukay
|
72,000
|
280,000
|
El Sauzal
|
307,000
|
200,000
|
Pe�asquito
|
--
|
70,000
|
Alumbrera (37.5%)
|
231,000
|
190,000
|
Marlin
|
227,000
|
225,000
|
San Martin
|
45,000
|
20,000
|
Total (Continuing Ops) Op)
|
2,178,000
|
2,600,000
|
Discontinued Mines2
|
109,000
|
--
|
Total (Reported)
|
2,287,000
|
2,600,000
|
1 2007 production based on 51% ownership of Porcupine and 68%
ownership of Musselwhite, until Dec 21, 2007 when the Company
acquired 100% ownership.
2 Includes Amapari, Peak and La Coipa.
The 2008 total cash cost forecast is approximately $250 per ounce, which is
higher than 2007 due to following factors:
- The 2007 JV asset swap adds
over 260,000
ounces of gold production in Canada, but increases
total cash costs by approximately $30.00 per gold ounce.
- The first full year of
commercial production at Los Filos mine in Mexico is expected to increase
the Company's total cash costs by approximately $20.00 per gold ounce in
2008.
- The 2008 forecast
by-product copper price of $3.00 per pound is below the average copper
price realized during 2007, contributing to an increase in total cash
costs of approximately $35.00 per gold ounce.
- Cost inflation and foreign
exchange effects also result in increased total cash costs.
The following graph provides a quarterly break-down of gold production and
total cash costs expected in 2008:
Production is expected to rise throughout the year as cash costs decrease
due to a sequential ramp-up in production at Los Filos and increased second
half production at Red Lake following the completion of the mine expansion
project.
Canada : Goldcorp's Production Base
Goldcorp's Canadian mines represent over 50% of the Company's 2008 gold
production. Forecast 2008 gold production at Red Lake mine of 740,000 ounces is
expected to increase in the second half as the Company concludes its expansion
project in the second quarter. Ventilation upgrades underway will bring a
threefold increase in ventilation capacity, enabling the Red Lake team to carry
out the next phase of mine development toward a goal of one million ounces of
annual gold production in the latter stages of the five-year plan.
Opportunities to grow production at the Company's two other large Ontario
mines, Musselwhite and Porcupine, are currently being evaluated. The
�l�onore project in Quebec is expected to be Goldcorp's next gold mine in
Canada with completion of a feasibility study at year end.
Mexico : Goldcorp's Growth Engine
Los Filos reached commercial production on January 1, 2008. Gold
production is expected to ramp up throughout the year as ounces of gold stacked
on the heap leach pads are placed under leach. The focus in 2008 will be
on continued production ramp-up and expansion of the leach pad.
Production at El Sauzal will decline as average gold grade
decreases. At San Dimas, planned investment will continue
throughout 2008 with the goal of increasing gold production from the current
production rates of 130,000 gold ounces and 7 million silver ounces to over
180,000 gold ounces and over 12 million ounces of silver over the next two
years. The Company continues to expect the first Pe�asquito gold pour from the
oxide heaps in 2008. Pe�asquito 2008 goals include construction of the
first SAG line and continued optimization studies to maximize opportunities at
what will be the largest mine in Mexico.
Investing in the Future
Capital expenditures for 2008 are forecast at $1.2 billion, including $700
million at Pe�asquito and $150 million at the �l�onore project. This
excludes any capital for the Pueblo Viejo project in the Dominican
Republic. The current five year plan for capital spending, excluding
Pueblo Viejo, is as follows:
Year
|
$ Millions
|
2008
|
$1,200
|
2009
|
$1,100
|
2010
|
$ 750
|
2011
|
$ 550
|
2012
|
$ 350
|
Exploration in 2008 will
total $150 million, of which approximately half is expected to be
expensed. Other than the primary goal of replacing mined ounces in
2008, particular emphasis will be placed on expansion opportunities at Red Lake
and Musselwhite, resource expansion at �l�onore, and development of underground
concepts and regional targets at Pe�asquito.
Financial Forecast
DD&A is expected to be approximately $215 per ounce of gold in
2008. General and administrative expense will total approximately $80
million.
Looking further ahead, total cash costs are expected to drop in the later
years of the Company's five year plan as production from Pe�asquito project
ramps up. The following graph provides details of gold production and
total cash costs expected for the five year plan:
Total cash cost remains below $250 per ounce throughout the forecast five
year period and production growth over the same period exceeds 50% - both
measures the best among the Company's peer group.
2007 Fourth Quarter and Year-End Conference Call
Goldcorp will release complete financial results for the fourth quarter and
2007 year before market on Thursday, February 21. A conference call to
discuss these results will also be held on February 21 at 10:00 a.m. PST.
Participants may join the call by dialing 1-866-226-1799 toll free or
416-641-6129 outside Canada and the US. A recorded playback of the call can be
accessed after the event until March 21, 2008 by dialing 800-408-3053 or
416-695-5800 for calls outside Canada and the US. Passcode: 324578. The
live call and archived audio webcast will also be available at www.goldcorp.com
Goldcorp is the world's fastest growing, lowest-cost multi-million ounce
gold producer with operations throughout the Americas. Gold production
and reserves from the Company's strong portfolio of mines and projects remains
100% unhedged.
The Company has included a non-GAAP performance measure, total cash cost per
gold ounce, throughout this document. The Company reports total cash costs on a
sales basis. In the gold mining industry, this is a common performance measure
but does not have any standardized meaning, and is a non-GAAP measure. The
Company follows the recommendations of the Gold Institute standard. The Company
believes that, in addition to conventional measures, prepared in accordance
with GAAP, certain investors use this information to evaluate the Company's
performance and ability to generate cash flow. Accordingly, it is intended to
provide additional information and should not be considered in isolation or as
a substitute for measures of performance prepared in accordance with GAAP.
Cautionary Note Regarding Forward-Looking Statements
Safe Harbor Statement under
the United States Private Securities Litigation Reform Act of 1995: Except for
the statements of historical fact contained herein, the information presented
constitutes "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Such forward-looking
statements, including but not limited to those with respect to the price of
gold, silver, copper, zinc and lead, the timing and amount of estimated future
production, costs of production, reserve determination and reserve conversion
rates involve known and unknown risks, uncertainties and other factors which
may cause the actual results, performance or achievement of Goldcorp to be
materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Such factors include,
among others, risks related to the integration of acquisitions, risks related
to international operations, risks related to joint venture operations, the
actual results of current exploration activities, actual results of current
reclamation activities, conclusions of economic evaluations, changes in project
parameters as plans continue to be refined, future prices of gold, silver and
copper, zinc and lead as well as those factors discussed in the section
entitled "General Development of the Business - Risks of the
Business" in Goldcorp's Form 40-F on file with the Securities and Exchange
Commission in Washington, D.C. and Goldcorp's Annual Information Form on file
with the securities regulatory authorities in Canada. Although Goldcorp
has attempted to identify important factors that could cause actual results to
differ materially, there may be other factors that cause results not to be as
anticipated, estimated or intended. There can be no assurance that such
statements will prove to be accurate as actual results and future events could
differ materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward-looking statements.
For further information, please contact: