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Goldcorp Announces Increase of Gold Reserves by 23%

GOLDCORP INC. (TSX: G, NYSE: GG) today announced that 2010 proven and probable gold reserves increased by 23% to 60.1 million ounces, the seventh consecutive year that the Company has increased gold reserves.

Measured and indicated gold resources also increased 13% to 25.7 million ounces in 2010. The Company also reported one of the largest silver holdings in the sector with proven and probable silver reserves and measured and indicated silver resources of 1.3 billion ounces and 457.6 million ounces, respectively.  

Highlights:

  • Recent vein discoveries at Cerro Negro nearly double gold reserves and resources.  Higher grade resources at the Marianas and San Marcos veins drive an increase to a total 2.7 million ounces of measured and indicated gold resource and 720,000 ounces of inferred gold resource, in addition to the existing 2.1 million ounces of proven and probable gold reserves. Further growth at Cerro Negro is anticipated from the extension of open-ended mineralization in several veins as well as further expansion of recent drill intercepts and testing of several other identified surface targets. A feasibility study update analyzing a doubling of mill throughput is expected to be complete at the end of the first quarter.
  • Investments in mine development and infrastructure at Red Lake result in successful reserves growth. Strong gold reserve additions in the High Grade Zone contributed to an overall increase in proven and probable gold reserves at Red Lake to over four million ounces.
  • First gold resource at Cochenour. An initial inferred gold resource of 2.7 million ounces has been derived from drilling of primarily the upper portions of the deposit.
  • Initial gold reserve declared at Éléonore. Conversion of measured and indicated gold resources adds over three million ounces to proven and probable gold reserves. This reserve and the updated resource will form the basis for an updated pre-feasibility study by the end of February.
  • El Morro reserve and resource increases contribute further upside to world-class project in Chile. Proven and probable gold reserves increase 22% to 5.7 million ounces and proven and probable copper reserves increase 8% to 4.3 billion pounds (70% basis).

The following accounts for the changes in gold reserves year over year:

"Strong growth in reserves and resources in 2010 underscores the continued success of Goldcorp's strategy to complement organic growth in our existing districts with disciplined acquisitions," said Chuck Jeannes, President and Chief Executive Officer. "Of the gold ounces we added through our drilling and planning efforts, we are particularly pleased that investments in exploration and development to ensure the long-term future of Red Lake and advance the Éléonore project have been so successful. Strong execution of our exploration programs at these operations and throughout the asset portfolio have resulted in this growth in gold reserves at finding costs of less than $15 per gold ounce.

"Among gold ounces we acquired during 2010, the updated resource at Cerro Negro supports the accretive metrics of our acquisition of Andean Resources as well as expectations for a significantly larger operation and a long-lived source of high quality gold production for the Company. An updated feasibility study based on more than a doubling of the current 1,850 tonne per day throughput is planned to be released in early April. An aggressive drilling program is underway that is expected to further increase reserves and resources through expansion of existing deposits as well as discoveries of new veins within this significant land package.

"Goldcorp's gold reserves have now increased in each of the last seven years. Importantly, in both the last year and throughout the entire seven-year period, our gold reserves have grown significantly not only in absolute terms but also on a per share basis. This accretive growth represents true value for our shareholders."

2011 Reserve and Resource Outlook

Goldcorp expects to invest an additional $170 million in exploration in 2011, with the goal of adding new discoveries, expanding on existing discoveries and further increasing reserves and resources.  Areas of high potential for reserve and resource enhancement in 2011 include:

  • Cerro Negro extensional drilling to expand open-ended mineralization at existing vein discoveries and exploration on new targets within the large, underexplored land package. Conversion of measured and indicated resources to reserves is expected to flow from completion of the updated feasibility study.
  • Following the environmental impact assessment approval at El Morro, commencement of the drill program to further delineate the pit at El Morro and expand on positive results from other targets.
  • Continued routine drilling of the High Grade Zone at Red Lake from the 4199 exploration drift, with the goal of adding reserves to the 54 level and adding gold resources below the 54 level.
  • Further drilling at the Cochenour project at Red Lake to grow and continue to define the current gold resource and test new adjacent target areas.
  • Refined block model and updated reserve model at Éléonore in advance of exploration shaft completion in 2012.
  • In-fill and expansion drilling of oxide ore and continued testing of sulphide systems at Peñasquito satellites Camino Rojo and Noche Buena will accelerate development plans at both projects.  Testing new geophysics targets in the covered valley and exploration for additional high grade mineralization in mantos beneath the pit bottoms at Peñasquito will also continue.
  • Expansion drilling, testing of new targets, and updated mine planning to reflect larger gold reserves and resources continue at Los Filos.
  • Extensional drilling to expand recent underground discoveries at Marlin in Guatemala and Musselwhite and Porcupine in Ontario.

Source: GOLDCORP INC.

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