Goldcorp’s project pipeline
Goldcorp (GG) has one of the strongest project pipelines in the industry. These projects underpin the company’s 20% growth in reserves by 2021. Goldcorp provided an update on the progress of these projects in its 1Q18 earnings call.
The chart above details these projects and their anticipated milestones for 2018 through 2021.
At Penasquito, the Pyrite Leach Project (or PLP) is 86.0% complete and expected to start commissioning during 4Q18, which is three months ahead of schedule. This project is expected to add ~1.0 million ounces of gold and 44.0 million ounces of silver over the current life of the mine.
GG’s Musselwhite Materials Handling Project (or MHP) is also advancing as planned and is 55.0% complete. During 1Q18, the team achieved a significant milestone by completing the longer of two raised boreholes required for the shop. The capital costs for the project are tracking 10.0% below budget, and its commissioning is expected to go as planned in 1Q19. At the Coffee project, the adequacy review process is going as planned.
At Porcupine’s Borden project, the construction of surface infrastructure has been completed. Development is going as scheduled. The mine is expected to start commercial production in the second half of 2019 and should constitute ~33.0% of Porcupine’s production in 2020.
NuevaUnion project prefeasibility study completed
At the end of 1Q18, the prefeasibility study (or PFS) of GG’s NuevaUnion project was completed. The project includes design changes to improve project economics and respond to community and indigenous peoples’ input. The PFS confirms the synergies expected through combining Teck Resources (TECK) and Goldcorp’s previously separate projects.
Goldcorp’s growth projects, along with an aggressive exploration program, should help the company grow its reserves 20.0% through 2021 and more beyond that. The company has identified Century, NuevaUnion, and Norte Abierto as the three projects that it expects to drive its organic growth beyond 2021.
Other miners’ reserves
Other gold miners (NUGT)(RING) have been reporting lower reserves lately. Barrick Gold (ABX) reported a 25.0% fall in its 2017 reserves, which came in at 64.5 million ounces. Some of this decline is due to the divestments associated with Veladero and Cerro Casale. Newmont Mining (NEM) also reported a fall in its reserve estimates in 2015 to 73.7 million ounces, a 10.0% reduction from 2014.
Kinross Gold’s (KGC) reserves fell 16.0% year-over-year in 2017 to 25.9 million ounces. The decline in reserves was mainly due to the sale of Cerro Casale, which accounted for 5.8 million ounces of estimated reserves.
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