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Goldcorp (GG) Inks Deal to Sell Camino Rojo Oxide Project
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Goldcorp Inc. has entered into a deal with Orla Mining Limited to sell its full interest in the Camino Rojo oxide project, located in Zacatecas, Mexico.
Per the agreement, Goldcorp will receive 19.9% of issued and outstanding common shares of Orla. The company will also get 2% Net Smelter Return royalty, based on the revenues from all metal production from the project, except in cases where metals are produced under a joint venture with Orla.
Goldcorp will also be entitled to an option to acquire up to a 70% interest in future sulphide projects. Further, if the company maintains equity ownership of over 10%, it will also get the right to nominate one director to Orla's board.
Goldcorp expects the transaction to close in the second half of 2017, subject to customary closing conditions.
Goldcorp’s shares have lost around 15.7% in the last three months, underperforming the Zacks categorized Mining–Gold industry’s 6.5% decline.
Goldcorp, in Apr 2017, noted that it expects 2017 gold production to be around 2.5 million ounces (+/- 5%), which remains unchanged from the previous guidance. The company expects all in sustaining costs (AISC) to be roughly $850 per ounce (+/- 5%), while total cash costs on a by-product basis are anticipated to be $500 per ounce (+/- 5%).
The company expects sustaining capital expenditures to be around $700 million (+/- 5%) and expansionary capital to be roughly $600 million, which will be spent on Musselwhite's Materials Handling Project, Penasquito's Pyrite Leach Project, Coffee, Borden, NuevaUnion and Cochenour.
Goldcorp remains focused on execution, cost reduction and optimization of asset portfolio. The company, earlier this month, completed the transactions to form a 50/50 joint venture (JV) with Barrick Gold , for the gold projects in the Maricunga District in Chile. Per the terms of JV agreement, both Goldcorp and Barrick will jointly control over 20,000 hectares of mining properties in Maricunga District with the Caspiche and Cerro Casale deposits.
The JV allows both companies to jointly advance the Caspiche and Cerro Casale gold deposits, by consolidating infrastructure. It will also help both companies to reduce operating costs and capital. The JV will also reduce environmental footprint and improve returns, versus two standalone projects.
Potash Corporation has expected long-term earnings growth rate of 6.5%.
Huntsman has expected long-term earnings growth rate of 7%.
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Goldcorp (GG) Inks Deal to Sell Camino Rojo Oxide Project
Goldcorp Inc. has entered into a deal with Orla Mining Limited to sell its full interest in the Camino Rojo oxide project, located in Zacatecas, Mexico.
Per the agreement, Goldcorp will receive 19.9% of issued and outstanding common shares of Orla. The company will also get 2% Net Smelter Return royalty, based on the revenues from all metal production from the project, except in cases where metals are produced under a joint venture with Orla.
Goldcorp will also be entitled to an option to acquire up to a 70% interest in future sulphide projects. Further, if the company maintains equity ownership of over 10%, it will also get the right to nominate one director to Orla's board.
Goldcorp expects the transaction to close in the second half of 2017, subject to customary closing conditions.
Goldcorp’s shares have lost around 15.7% in the last three months, underperforming the Zacks categorized Mining–Gold industry’s 6.5% decline.
Goldcorp, in Apr 2017, noted that it expects 2017 gold production to be around 2.5 million ounces (+/- 5%), which remains unchanged from the previous guidance. The company expects all in sustaining costs (AISC) to be roughly $850 per ounce (+/- 5%), while total cash costs on a by-product basis are anticipated to be $500 per ounce (+/- 5%).
The company expects sustaining capital expenditures to be around $700 million (+/- 5%) and expansionary capital to be roughly $600 million, which will be spent on Musselwhite's Materials Handling Project, Penasquito's Pyrite Leach Project, Coffee, Borden, NuevaUnion and Cochenour.
Goldcorp remains focused on execution, cost reduction and optimization of asset portfolio. The company, earlier this month, completed the transactions to form a 50/50 joint venture (JV) with Barrick Gold , for the gold projects in the Maricunga District in Chile. Per the terms of JV agreement, both Goldcorp and Barrick will jointly control over 20,000 hectares of mining properties in Maricunga District with the Caspiche and Cerro Casale deposits.
The JV allows both companies to jointly advance the Caspiche and Cerro Casale gold deposits, by consolidating infrastructure. It will also help both companies to reduce operating costs and capital. The JV will also reduce environmental footprint and improve returns, versus two standalone projects.
Goldcorp Inc. Price and Consensus
Goldcorp Inc. Price and Consensus | Goldcorp Inc. Quote
Goldcorp currently carries a Zacks Rank #3 (Hold).
Stocks to Consider
Some better-ranked stocks in the basic materials space include Potash Corporation of Saskatchewan Inc. and Huntsman Corporation (HUN - Free Report) . Both the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.
Potash Corporation has expected long-term earnings growth rate of 6.5%.
Huntsman has expected long-term earnings growth rate of 7%.
Looking for Ideas with Even Greater Upside?
Today's investment ideas are short-term, directly based on our proven 1 to 3 month indicator. In addition, I invite you to consider our long-term opportunities. These rare trades look to start fast with strong Zacks Ranks, but carry through with double and triple-digit profit potential. Starting now, you can look inside our home run, value, and stocks under $10 portfolios, plus more. Click here for a peek at this private information >>