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Goldcorp (GG) Wraps Up Sale of Cerro Blanco to Bluestone

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Goldcorp Inc. declared that it has closed the sale of its 100% interest in Cerro Blanco gold-silver project, located in Guatemala, to Bluestone Resources Inc.

Per the terms of the deal, Goldcorp received around $18 million in cash, 1% Net Smelter Return royalty on production, the right to receive 4.9% stake in Bluestone’s outstanding common shares and 258,805 common share warrants.

Moreover, Goldcorp will receive an additional $15 million in cash within six months after commercial production begins at the Cerro Blanco facility. Bluestone was also granted a right of first refusal to the purchase of certain equipment and assets at the Marlin mine, which is also based in Guatemala. Goldcorp also received non-refundable deposits worth $2 million from Bluestone, applicable against future purchases.

Goldcorp’s shares have lost around 13% in the last three months, underperforming the Zacks categorized Mining–Gold industry’s 1.1% loss.



Goldcorp reported net earnings of $170 million or 20 cents per share for first-quarter 2017, compared with $80 million or 10 cents per share a year ago. Earnings per share beat the Zacks Consensus Estimate of 9 cents.

Goldcorp 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 mainly spent on Musselwhite's Materials Handling Project, Penasquito's Pyrite Leach Project, Coffee, Borden, NuevaUnion and Cochenour.

The company remains focused on execution, cost reduction and optimization of asset portfolio. It has a planned joint venture (JV) in the Maricunga District in Chile, which is expected to produce 60 million ounces of gold, which will be financed by the sale of non-core assets. The JV is in line with the strategy of growing net asset value per share by delivering 3–4 million ounces of sustainable gold production from 6–8 core camps annually.

Goldcorp Inc. Price and Consensus

 

Goldcorp Inc. Price and Consensus | Goldcorp Inc. Quote

Goldcorp currently carries a Zacks Rank #3 (Hold).

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