(All Amounts in $US unless specified otherwise)
VANCOUVER, March 28, 2017 /PRNewswire/ - GOLDCORP
INC. (TSX: G, NYSE: GG) (the "Company" or "Goldcorp") today
announced that it has entered into an agreement with Barrick Gold
Corporation (TSX: ABX; NYSE: ABX) ("Barrick") to leverage potential
synergies within the Maricunga Gold Belt, located in the Atacama
Region in northern Chile, through
a 50/50 joint venture (the "Transaction"). The Transaction is
being effected through a number of steps, including:
- The acqusition by Goldcorp of Kinross Gold Corporation's
(TSX:K; NYSE:KGC) ("Kinross") 25% interest in Cerro Casale and 100%
interest in the Quebrada Seca exploration project for (i) an
initial cash payment of $260 million,
(ii) the granting of a 1.25% royalty interest by Goldcorp on 25% of
gross revenues from payable metal from Cerro Casale and Quebrada
Seca, with Kinross foregoing the
first $10 million payable, (iii) a
contingent payment of $40 million
payable after a construction decision at Cerro Casale, and (iv) the
assumption of a $20 million
obligation to Barrick payable on commercial production at Cerro
Casale;
- The acquisition by Goldcorp of an additional 25% interest in
Cerro Casale from Barrick for (i) a deferred payment obligation of
$260 million to be satisfied through
the funding of 100% of Cerro Casale expenditures (as described
below), (ii) the granting of a 1.25% royalty interest by Goldcorp
on 25% of gross revenues from payable metal from Cerro Casale and
Quebrada Seca, (iii) a contingent payment of $40 million payable after a construction decision
at Cerro Casale, and (iv) the transfer to Barrick of a 50% interest
in Quebrada Seca for no additional consideration, followed by the
joint contribution by Goldcorp and Barrick of 100% of Quebrada Seca
to the joint venture;
- The acquisition by Goldcorp of Exeter Resource Corporation
("Exeter") (TSX: XRC; NYSE-MKT: XRA; Frankfurt: EXB) and its
100%-owned Caspiche project ("Caspiche") located in the Maricunga
Gold Belt in Chile, approximately
10 kilometers to the north of Cerro Casale, for share consideration
of approximately $185 million (on a
fully diluted basis); and
- The contribution of Caspiche into the joint venture with 50% of
the acquisition cost, or approximately $85
million, applied to reduce the $260
million deferred payment obligation.
"With the formation of a 50/50 joint venture with Barrick, we
envisage jointly advancing the Cerro Casale and Caspiche gold
deposits in a similar arrangement to our NuevaUnión project in
Chile with Teck Resources" said
David Garofalo, President and Chief
Executive Officer. "The joint venture with Barrick has the
potential to allow us to consolidate infrastructure to reduce
capital and operating costs, reduce the environmental footprint and
provide increased returns compared to two standalone
projects. With our combined technical and financial strength,
we see significant potential to advance these projects and increase
net asset value per share over time, delivering value for all
partners and stakeholders."
Under the terms of the joint venture, Goldcorp is required to
spend a minimum of $60 million in the
two-year period following closing of the Transaction, and a minimum
of $80 million in each successive
two-year period until the deferred payment obligation is satisfied.
If Goldcorp does not spend the minimum in any two-year
period, Goldcorp will instead be required to make a payment to
Barrick equal to 50% of the shortfall (with a corresponding
reduction in the deferred payment obligation).
Cerro Casale and Caspiche currently report the following mineral
reserves and mineral resources:
Cerro Casale1 (100% basis)
|
Tonnes
(Mt)
|
Au
(g/t)
|
Contained Au
(Moz)
|
Cu
(%)
|
Contained Cu
(Blbs)
|
Ag
(g/t)
|
Contained
Ag (Moz)
|
Proven &
Probable
|
1,197.6
|
0.60
|
23.2
|
0.22
|
5.8
|
1.52
|
58.7
|
Measured &
Indicated
|
296.6
|
0.35
|
3.4
|
0.16
|
1.1
|
1.07
|
10.2
|
Inferred
|
495.4
|
0.38
|
6.0
|
0.19
|
2.1
|
1.04
|
16.5
|
Caspiche2 (100% basis)
|
Tonnes
(Mt)
|
Au
(g/t)
|
Contained Au
(Moz)
|
Cu
(%)
|
Contained Cu
(Blbs)
|
Ag
(g/t)
|
Contained
Ag (Moz)
|
Measured &
Indicated
|
1,403.6
|
0.51
|
23.0
|
0.19
|
5.9
|
1.20
|
54.2
|
Inferred
|
198.1
|
0.29
|
1.8
|
0.12
|
0.5
|
0.91
|
5.8
|
Advisors and Counsel
Goldcorp's financial advisor is
TD Securities and its legal advisors for the Transaction are
McCarthy Tetreault LLP and Cariola Díez Pérez-Cotapos, and its
Canadian legal advisor for the Exeter transaction is Cassels, Brock &
Blackwell LLP.
The scientific and technical information contained in this news
release has been reviewed and approved by Gil Lawson, P.Eng., Vice President of Geology
and Mine Planning, Goldcorp, who is a qualified person under
National Instrument 43-101 ("NI 43-101").
For a summary of the transaction refer to the attached
factsheet.
About Goldcorp
Goldcorp is a senior gold
producer focused on responsible mining practices with safe,
low-cost production from a high-quality portfolio of mines.
Footnote:
1 Refer to Barrick and
Kinross' websites for further
information on the Cerro Casale mineral reserves and mineral
resources estimates (figures have been aggregated and rounded):
http://www.barrick.com/files/quarterly-reports/2016/Barrick-2016-Reserves-Resources.pdf;
http://s2.q4cdn.com/496390694/files/doc_downloads/reserves_and_resources/Kinross-Annual-Mineral-Reserve-and-Resource-Statement.pdf
2 The mineral resource estimate for Caspiche has been
derived from Exeter's technical
report entitled "Amended NI 43-101 Technical Report on
the Caspiche Project" dated December 19,
2014, a copy of which is available on Exeter Resource
Corporation's website at (figures have been rounded):
http://exeterresource.com/site/wp-content/uploads/2013/07/Exeter_TR_Caspiche_Dec_2014.pdf
Cautionary Note Regarding Forward Looking
Statements
This press release contains "forward-looking statements" within
the meaning of Section 27A of the United States Securities Act of
1933, as amended, Section 21E of the United States Exchange Act of
1934, as amended, the United States Private Securities
Litigation Reform Act of 1995, or in releases made by the United
States Securities and Exchange Commission, all as may be amended
from time to time, and "forward-looking information" under the
provisions of applicable Canadian securities legislation,
concerning the business, operations and financial performance and
condition of Goldcorp. Forward-looking statements include, but are
not limited to, statements with respect to the anticipated benefits
of the Transaction timing and anticipated receipt of regulatory
approvals for the Transaction, the ability of the parties to
satisfy conditions of and to complete the Transaction within the
times specified, the development of the Cerro Casale project
statements with respect to the future price of gold, silver,
copper, lead and zinc, the estimation of Mineral Reserves (as
defined below) and Mineral Resources (as defined below), the
realization of Mineral Reserve estimates, the timing and amount of
estimated future production, costs of production, targeted cost
reductions, capital expenditures, free cash flow, costs and timing
of the development of new deposits, success of exploration
activities, permitting time lines, hedging practices, currency
exchange rate fluctuations, requirements for additional capital,
government regulation of mining operations, environmental risks,
unanticipated reclamation expenses, timing and possible outcome of
pending litigation, title disputes or claims and limitations on
insurance coverage. Generally, these forward-looking statements can
be identified by the use of forward-looking terminology such as
"plans", "expects" , "is expected", "budget", "scheduled",
"estimates", "forecasts", "intends", "anticipates" , "believes", or
variations or comparable language of such words and phrases or
statements that certain actions, events or results "may", "could",
"would", "should", "might" or "will be taken", "occur" or "be
achieved" or the negative connotation thereof.
Forward-looking statements are necessarily based upon a number
of factors and assumptions that, if untrue, could cause the actual
results, performances or achievements of Goldcorp to be materially
different from future results, performances or achievements
expressed or implied by such statements. Such statements and
information are based on numerous assumptions regarding present and
future business strategies and the environment in which Goldcorp
will operate in the future, including the price of gold,
anticipated costs and ability to achieve goals. In respect of the
forward-looking statements concerning the anticipated completion of
the proposed Transaction and the anticipated timing for completion
of the Transaction, Goldcorp has provided them in reliance on
certain assumptions that they believe are reasonable at this time
the ability of the parties to receive, in a timely manner, the
necessary regulatory, court and other third party approvals; and
the ability of the parties to satisfy, in a timely manner, the
other conditions to the closing of the Transaction. Certain
important factors that could cause actual results, performances or
achievements to differ materially from those in the forward-looking
statements include, among others, gold price volatility,
discrepancies between actual and estimated production, Mineral
Reserves and Mineral Resources and metallurgical recoveries, mining
operational and development risks, litigation risks, regulatory
restrictions (including environmental regulatory restrictions and
liability), changes in national and local government legislation,
taxation, controls or regulations and/or change in the
administration of laws, policies and practices, expropriation or
nationalization of property and political or economic developments
in Canada, the United States and other jurisdictions in
which the Company does or may carry on business in the future,
delays, suspension and technical challenges associated with capital
projects, higher prices for fuel, steel, power, labour and other
consumables, currency fluctuations, the speculative nature of gold
exploration, the global economic climate, dilution, share price
volatility, competition, loss of key employees, additional funding
requirements and defective title to mineral claims or property.
Although Goldcorp believes its expectations are based upon
reasonable assumptions and has attempted to identify important
factors that could cause actual actions, events or results to
differ materially from those described in forward-looking
statements, there may be other factors that cause actions, events
or results not to be as anticipated, estimated or intended.
Forward-looking statements are subject to known and unknown
risks, uncertainties and other important factors that may cause the
actual results, level of activity, performance or achievements of
Goldcorp to be materially different from those expressed or implied
by such forward-looking statements, including but not limited to:
the risk that the transaction may not close when planned or at all
or on the terms and conditions set forth in the Transaction
Agreement; the failure to obtain the necessary court, regulatory
and other third party approvals required in order to proceed with
the transaction; the benefits expected from the Transaction not
being realized; risks related to the integration of acquisitions;
risks related to international operations, including economic and
political instability in foreign jurisdictions in which Goldcorp
operates; risks related to current global financial conditions;
risks related to joint venture operations; actual results of
current exploration activities; actual results of current
reclamation activities; environmental risks; conclusions of
economic evaluations; changes in project parameters as plans
continue to be refined; future prices of gold, silver, copper, lead
and zinc; possible variations in ore reserves, grade or recovery
rates; failure of plant, equipment or processes to operate as
anticipated; mine development and operating risks; accidents,
labour disputes and other risks of the mining industry; risks
associated with restructuring and cost-efficiency initiatives;
delays in obtaining governmental approvals or financing or in the
completion of development or construction activities; risks related
to the integration of acquisitions; risks related to indebtedness
and the service of such indebtedness, as well as those factors
discussed in the section entitled "Description of the Business –
Risk Factors" in Goldcorp's most recent annual information
form available on SEDAR at www.sedar.com and on EDGAR at
www.sec.gov. Although Goldcorp has attempted to identify important
factors that could cause actual results to differ materially from
those contained in forward-looking statements, 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. Forward-looking statements are made as of the date
hereof and, accordingly, are subject to change after such date.
Except as otherwise indicated by Goldcorp, these statements do not
reflect the potential impact of any non-recurring or other special
items or of any disposition, monetization, merger, acquisition,
other business combination or other transaction that may be
announced or that may occur after the date hereof. Forward-looking
statements are provided for the purpose of providing information
about management's current expectations and plans and allowing
investors and others to get a better understanding of Goldcorp's
operating environment. Goldcorp does not intend or undertake to
publicly update any forward-looking statements that are included in
this document, whether as a result of new information, future
events or otherwise, except in accordance with applicable
securities laws.
SOURCE Goldcorp Inc.