Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Goldcorp (TSX: G; NYSE: GG) expects to produce more silver, zinc, lead and gold equivalent oz. in 2019 compared to 2018.
The company, which is currently merging with Newmont (NYSE: NEM), produced 630,000 oz. gold in 2018’s fourth quarter at $850 per oz. gold all in sustaining costs (AISC). In 2018, it produced 2.29 million oz. gold, and expects to produce a similar amount of gold in 2019.
The company expects the Newmont merger to close in 2019’s second quarter, then the new entity will provide updated guidance for the combined company.
The company expects silver production to increase from 25 million oz. in 2018 to between 40 and 50 million oz. in 2019; it expects zinc production to increase from 318 million lb. in 2018 to between 390 and 450 million lb. in 2019; it expects lead production to increase from 116 million lb. 2018 to between 240 and 290 million lb. in 2019; and it expects gold equivalent production to jump from 3 million oz. in 2018 to between 3.3 and 3.7 million oz. in 2019.
The company expects lower gold grades in 2019’s first quarter at its Cerro Negro, Eleonore and Red Lake gold mines, but says gold production should increase progressively each quarter as its Musselwhite Materials Handling and Borden projects reach commercial production in the second half of 2019.
Borden is slated to be the world’s first all-electric gold mine, while the material’s handling program at the Musselwhite gold mine should make moving ore to the mill more efficient.
The company predicts $750 to $850 per oz. gold AISC in 2019. The company has not yet released its 2018 full-year financials, but previously said it expects 2018 full-year AISC to be at $850 per oz. gold. It says it will announce its full-year financials on Feb. 13, 2019.
Shares of Goldcorp are currently trading at $14.46 with a 52-week range of $11 to $18.78. The company has a $12.5 billion market capitalization.
This story first appeared in The Northern Miner.
Comments
Alain Belanger
Really great for them the Community take so long to be in a good range this merger was the right moves timing was perfect and Gold its on the move and good will reach full price been Wishes over 18 years the Market has over Bullish time be barish PPG is Bankrupt that huge also been part sly destroy by last summer ? in California More to come Company will follow The World is Bankruptcy prints money last 2008 Finaciancial Criss 50 Trillions where missing Leman Brothers was Bankrupted that huge Bearskin when from $69:00 to $2.00! Anyway time to build this Relationship Don’t look behind stay Foward that’s the Key The Newsmont and Gold Corp time to drill just drill Baby Just Drill