Cerro Negro Mine Tour...of mineral reserves and resources, the realization of mineral reserve...
Transcript of Cerro Negro Mine Tour...of mineral reserves and resources, the realization of mineral reserve...
Cerro Negro
Mine Tour
FEBRUARY 26-27, 2015
Forward Looking Statements
This presentation contains “forward-looking statements”, within the meaning of the United States Private Securities Litigation Reform Act of 1995 and
applicable Canadian securities legislation, concerning the business, operations and financial performance and condition of Goldcorp Inc. (“Goldcorp”).
Forward-looking statements include, but are not limited to, statements with respect to the future price of gold, silver, copper, lead and zinc, the estimation
of mineral reserves and resources, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of
production, capital expenditures, 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” or “does
not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, “believes” or variations of such
words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be
achieved”. Forward-looking statements are subject to known and unknown risks, uncertainties and other 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: risks related to the integration of acquisitions; risks related to international operations; risks related to joint venture
operations; 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, copper, lead and zinc; possible variations in ore reserves, grade or
recovery rates; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes; delays in obtaining governmental approvals
or financing or in the completion of development or construction activities and other risks of the mining industry, as well as those factors discussed in the
section entitled “Description of the Business – Risk Factors” in Goldcorp’s annual information form for the year ended December 31, 2013 available at
www.sedar.com. 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. Goldcorp does not undertake to update any forward-looking
statements that are included in this document, except in accordance with applicable securities laws.
All amounts are in U.S. dollars, unless otherwise stated.
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The Golden Guide is PPE
“With everyone in our company using our Golden Guide to plan each task, job, or day - we will achieve a step change in our overall safety performance.” George Burns, COO
• Golden Guide will be mandatory
PPE from 1st April 2015.
• Take the time to fill out your pledge
and include a photograph of your
loved ones.
• Everyone is responsible for their
own safety, as well as the safety of
others, which means really being
engaged in the field every day,
speaking up when things aren't
right, and looking out for our co-
workers.
Goldcorp Participants
George Burns – EVP & COO
Lindsay Hall – EVP & CFO
Charlie Ronkos – SVP, Exploration
Jeff Wilhoit – VP, Investor Relations
Lynette Gould – Director, Investor Relations
Edgardo Lopez – Director, Finance, Central/South America
Xavier Ochoa – Mine General Manager, Cerro Negro
Jon Graham – Operations Manager, Cerro Negro
Andy Tripp – Technical Services Manager, Cerro Negro
Gassaway Brown – Sr. Corporate Geologist, Exploration, Latin America
Steve Long – Mining Manager, Cerro Negro
Ruben Zevallos – Processing Manager, Cerro Negro 4
Proven Strategy W I T H A C O N S I S T E N T F O C U S
CREATING SUSTAINABLE VALUE
Quality
Growth Gold Focus
Responsible Mining
Practices
Safe,
Profitable
Production
Peer-Leading
Balance
Sheet
Low Political
Risk
TOGETHER
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2014 Achievements P R O V E N S T R AT E G Y
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Achieved zero fatalities
Increased gold production to a record of 2.87 million ounces
Delivered two new high quality, low-cost mines
Reduced all-in sustaining costs to $949/oz
Realized benefits of $280 million from the Operating for Excellence program
Divested non-core assets
Maintained investment grade balance sheet
2015 Deliverables P R O V E N S T R AT E G Y
Achieve zero fatalities
Deliver free cash flow after dividends
Grow gold production to between 3.3 and 3.6 million ounces
Achieve successful ramp ups at Cerro Negro and Éléonore
Advance Concentrate Enrichment/Pyrite Leach feasibility study at Peñasquito
Replace/grow mine reserves Company-wide
Realize benefits of $175 million from the Operating for Excellence program
Maintain investment grade balance sheet
Complete sale of Wharf; Probe acquisition
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(1) 2015 price assumptions: Au=$1,200/oz, Ag=$18.00/oz, Cu=$3.00/lb, Zn=$1.00/lb, Pb=$0.95/lb. (2) Includes capitalized exploration
2014 Actual 2015 Guidance(1)
Gold Production (oz) 2.87M 3.3 - 3.6M
Cash costs $ / oz
All-in sustaining
By-product
Co-product
$949
$542
$668
$875 - $950
$500 - $550
$625 - $675
Capital expenditures(2) $2.2B $1.2B - $1.4B
Exploration expenditures(2) $152M $170M
Corporate administration $175M $185M
Depreciation / oz $336 $390
Tax rate 23% 35%
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Positive Momentum F I N A N C I A L D I S C I P L I N E
Sustained High Quality Production F I N A N C I A L D I S C I P L I N E
STRONG PRODUCTION , LOW-COSTS TO DRIVE INCREASING FREE CASH FLOW
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0.0
5.0
2014A 2015E 2016E 2017E 2018E 2019E
GO
LD
PR
OD
UC
TIO
N
(MO
Z)
Gold GEO
Strong Balance Sheet Maintained F I N A N C I A L D I S C I P L I N E
$1.74B
Liquidity(1)
$0.54B Cash & Cash
Equivalents
$1.2B Undrawn Revolving Credit Facility
NET DEBT AS % OF MARKET CAP(2)
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PROVIDES FLEXIBILITY TO FUND GROWTH OPPORTUNITIES
(1) As of December 31, 2014
(2) As of February 19, 2015; All amounts as reported in company financial statements and adjusted for subsequent transactions. Goldcorp’s
net debt position adjusted to include $355M of attributable Pueblo Viejo project debt and reduced by $105 mm due to sale of Wharf.
18% 19%
33% 35%
40% 43%
67% 67%
Agnico Goldcorp Kinross Newmont Newcrest Yamana AngloGold Barrick
$10.0B $3.1B $1.6B $3.4B $4.2B $1.0B $3.3B $1.2B
Operating mines
Development projects
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(1) Based on 2015 guidance as per January 12, 2015 press release and Wharf divestiture on Feb. 20, 2015
2015E
GOLD
PRODUCTION
BY REGION(1)
33% CENTRAL/SOUTH
AMERICA 38% CANADA/USA
29% MEXICO
Geographic Diversity in the Americas U N R I VA L E D P O R T F O L I O A N C H O R E D B Y Y O U N G , L O W - C O S T M I N E S
Cerro Negro A N E W C O N T R I B U T O R T O G O L D C O R P ’ S P R O D U C T I O N G R O W T H
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Table of Contents C E R R O N E G R O M I N E
LOCATION / OVERVIEW
OPERATION RAMP UP
DRILLING
BUILDING PARTNERSHIPS
KEY TAKEAWAYS
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Text line 1 T E X T L I N E 2
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Operating mines
Development projects
Location C E R R O N E G R O M I N E
Text line 1 T E X T L I N E 2
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Integrated Complex C E R R O N E G R O M I N E
• 5 high grade underground mines (Eureka, Mariana Central, Mariana Norte,
San Marcos, Bajo Negro)
• 1 open pit - Vein Zone
• 1 CCD+Merrill-Crowe mill
Cerro Negro Mine at a Glance N E W G R O W T H D R I V E R
HIGH GRADE VEIN SYSTEM
OUTSTANDING RESERVE GROWTH
POTENTIAL
• Reserve and resources (1)
- P&P reserves: 5.26Mozs
- M&I resources: 0.65Mozs
- Inferred resources: 0.32Mozs
• Mine life: 15 years
• All veins remain open for expansion
(1) Year ended December 31, 2014
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COMMERCIAL PRODUCTION ACHIEVED
JAN. 1, 2015
• 2014A: 152,100ozs - Ore Processing from:
- High grade development stockpiles
from Eureka & Mariana Central
- High grade ore production from
Eureka
• 2015E: 425,000 - 475,000ozs
INITIAL CONSTRUCTION COMPLETED
• Permanent power achieved Feb. 2, 2015
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Achieving Milestones C E R R O N E G R O M I N E
July 15, 2014
Plant Startup
Dec. 31, 2013
285kt Stockpile
July 25, 2014
First Gold
Jan. 1, 2015
Commercial
Production
Feb. 2, 2015
Permanent
Power
2015 Budget & Deliverables C E R R O N E G R O M I N E
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Continued development & production ramp up at Mariana Central
Operating on permanent power
Drilling at Bajo Negro, Vein Zone and Marianas Complex
Expanded training program for new & existing workforce (w/Redpath Mining)
Optimize manpower to leverage Mariana Central ramp-up
Construction of Marianas Mines’ surface complex & upgraded infrastructure
Complete mine ramp-up (Eureka – Q3, Mariana Central – Q4)
Operating for Excellence Initiatives C E R R O N E G R O M I N E
- Optimize shift schedule
- Mechanized ground support cycle reduction
- Sprinkler road dust suppression system
- Mine water inflow reduction through
dewatering wells
- Ag recovery increase through lead nitrate
addition and optimized use of cyanide.
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- Reduction of fresh water consumption for
process use
- Increased recycling
- Integration of treated sewage streams
into water balance
- Supply chain logistics and warehouse
facility management streamlining
- Alternative sourcing = local providers
development / OEM-imported parts
substitution / parts & component rebuilding
Text line 1 T E X T L I N E 2
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Fully Mechanized Underground Mining C E R R O N E G R O M I N E
• Overhand Long Hole Stoping with Rock Backfill
• Mining in Horizons along veins
Text line 1 T E X T L I N E 2
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2015 Production C E R R O N E G R O M I N E
2015 Recovered Ounces by Vein
Eureka 125,000 - 150,000
Mariana Central 250,000 - 275,000
Eureka & Mariana Stockpiles 50,000
Total 425,000 – 475,000
0
500
1,000
1,500
2,000
2,500
3,000
3,500
To
nn
es
per
Day o
f O
re M
ined
Dateline
Total Mine Capacity Realized
Eureka & Mariana Central 30-day lagging average
Text line 1 T E X T L I N E 2
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Daily Mine Production Ramp Up C E R R O N E G R O M I N E
Eureka
Stoping
Started
Mariana
Stoping
Started
Mining
Takeover
from
Contractor
0
500
1,000
1,500
2,000
2,500
3,000
To
nn
es
per
Day o
f O
re M
ined
Dateline
Eureka
Eureka 30-day lagging average
Text line 1 T E X T L I N E 2
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Daily Mine Production Ramp Up C E R R O N E G R O M I N E
First
Stope
Initiated
Mining
Takeover
from
Contractor
Text line 1 T E X T L I N E 2
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Daily Mine Production Ramp Up C E R R O N E G R O M I N E
0
200
400
600
800
1,000
1,200
1,400
To
nn
es
per
Day o
f O
re M
ined
Dateline
Mariana Central
Mariana Central 30-day lagging average
First
Stope
Initiated
Mining
Takeover
from
Contractor
Text line 1 T E X T L I N E 2
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Text line 1 Processing Flow Sheet C E R R O N E G R O
GRINDING CRUSHING
LEACHING GRAVITY
‘CCD’
Counter Current
Decantation
MERRILL
CROWE TAILS
Overall gold recovery of 92% & silver at 71% in Q4, 2014
DORE
Text line 1 T E X T L I N E 2
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Mill Throughput C E R R O N E G R O M I N E
Actual to Date
Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-151
Total Throughput (t) 7,555 23,683 58,904 94,602 96,477 100,088 81,547 65,412
Average daily throughput
(t/d) 503 764 1,963 3,052 3,216 3,229 2,631 3,115
Peak throughput (t/d) 819 1,869 3,343 4,102 4,180 4,350 3,847 3,459
(1) As of February 21, 2015
Text line 1 T E X T L I N E 2
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Mill Throughput C E R R O N E G R O M I N E
Q1 - Entering Stabilization Stage
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
Jul-2014 Aug-2014 Sep-2014 Oct-2014 Nov-2014 Dec-2014 Jan-2015 Feb-2015
Mill Throughput Performance1
2015 Budget Planned Milling Rate (tonnes per day milled)
Average daily throughput (tonnes per day milled)
Maximum Throughput Reached During Month (tonnes per day milled)
Nameplate Mill Capacity (tonnes per day milled)
(1) As of February 21, 2015
Text line 1 T E X T L I N E 2
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Strong Recoveries C E R R O N E G R O M I N E
Text line 1 T E X T L I N E 2
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Fresh Water Consumption C E R R O N E G R O M I N E
-
0.10
0.20
0.30
0.40
0.50
0.60
0.70
9/1/2014 10/1/2014 11/1/2014 12/1/2014 1/1/2015 2/1/2015
Spe
cifi
c W
ate
r C
on
sum
pti
on
(
Cu
bic
me
ters
pe
r to
nn
e m
ille
d)
Milling Water Consumption
Total (Plan) Water Consumption
Actual Fresh Water Consumption
Substantial Reduction in Water Footprint & Water Costs
Water Reuse
Paid for groundwater
T E X T L I N E 2
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Eureka Backfill Plant
Mariana Central Portal
Eureka Mine Complex
Eureka ore Stockpile
Text line 1 T E X T L I N E 2 Surface Mine Facilities C E R R O N E G R O M I N E
Core Drilling
Text line 1
MINING PHOTOS
Ramp Development
Eureka Backfilled Stope Eureka Stope – Top View
Eureka Stope – Bottom View
Mariana Central – First Stope
Top View
Mariana Central – First Stope
Bottom View
Text line 1 T E X T L I N E 2 Underground Mines C E R R O N E G R O M I N E
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T E X T L I N E 2
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Vein Zone Camp & Mill Tailings Facility
Text line 1 T E X T L I N E 2 Process Facilities C E R R O N E G R O M I N E
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Life of Mine Plan
Text line 1 T E X T L I N E 2
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Multi-Mine Sequence M I N E P L A N
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Drilling
Text line 1 T E X T L I N E 2
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2.07 2.07
4.26 4.54
5.74 5.74 5.26
0.38
2.66
0.38 0.55
0.51 0.51
0.65
0.57
0.72 0.72
1.04
0.82 0.82
0.32
0
1
2
3
4
5
6
7
8
Dec2010
Feb2011
Mar2011
Dec2011
Dec2012
Dec2013
Dec2014
Millio
n O
zs
Gold
Reserves Resources Inferred
20.5 20.5
36.16 38.78
49.36 49.36 43.63 2.83
18.74
2.83 3.11
3.78 3.78
5.59
3.23
4.69 4.68
5.15
5.87 5.87
1.86
0
10
20
30
40
50
60
70
Dec2010
Feb2011
Mar2011
Dec2011
Dec2012
Dec2013
Dec2014
Millio
n O
zs
Silver
Reserves Resources Inferred
(1) Refer to Appendix A for further information on Gold and Silver Mineral Reserve and Resources
Reserve & Resources D R I L L I N G
Nn
Text line 1 T E X T L I N E 2
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(1) Based on 2015 guidance as per January 13, 2015 press release
West Belt
East Belt
New Shoots and Vein Extensions
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Text line 1 T E X T L I N E 2
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(1) Based on 2015 guidance as per January 13, 2015 press release
Eureka Vein System
As of December 31, 2014
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Au 2.98 10.52 1.01 0.87 6.33 0.18 0.26 8.99 0.07
Ag 2.98 170.95 16.36 0.87 91.74 2.57 0.26 98.41 0.81
Ounces
(moz)
Tonnes
(mt)(g/t)
Ounces
(moz)
2P Reserves M+I Resrources Inf. Resources
Tonnes
(mt)(g/t)
Ounces
(moz)
Tonnes
(mt)(g/t)
Text line 1 T E X T L I N E 2
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(1) Based on 2015 guidance as per January 13, 2015 press release
Bajo Negro Vein System
As of December 31, 2014
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Au 1.95 8.83 0.55 0.35 5.97 0.07 0.28 7.09 0.06
Ag 1.95 26.23 1.64 0.35 20.35 0.23 0.28 21.72 0.19
Ounces
(moz)
Tonnes
(mt)(g/t)
Ounces
(moz)
Tonnes
(mt)(g/t)
Ounces
(moz)
Tonnes
(mt)(g/t)
2P Reserves M+I Resrources Inf. Resources
?
?
1
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(1) Based on 2015 guidance as per January 13, 2015 press release
Vein Zone
40 Au 2.7 4.22 0.37 0.78 1.62 0.04 0.32 1.84 0.02
Ag 2.7 8.69 0.76 0.78 3.68 0.09 0.32 3.82 0.04
(g/t)Ounces
(moz)
Tonnes
(mt)(g/t)
Ounces
(moz)
Tonnes
(mt)(g/t)
Ounces
(moz)
Tonnes
(mt)
2P Reserves M+I Resrources Inf. Resources
As of December 31, 2014
?
?
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Community & Partnerships
Integrating into the Community C O M M U N I T Y & PA R T N E R S H I P S
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Active development of local suppliers & business partners
Local workforce training
Multi-year Perito Moreno County Sustainable Development Plan
US$1.5M commitment for development of a school complex
Voluntary collaboration agreements
Perito Moreno County – 1% of earnings committed to a trust fund to
finance infrastructure, educational programs and social development.
Santa Cruz Province – sliding scale (1% down to 0.25% of revenues)
trust fund for public health improvement and development
Key Takeaways
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BUILDING A CORNERSTONE MINE
Strong
production
profile
Significant
exploration
potential
Initial capital
spend
completed
Growing
community
partnerships
TOGETHER