Goldcorp Eleonore Project Fire Put Out - Analyst Blog

Goldcorp Inc. (GG) announced that a spell of rain in the James Bay region of Quebec has helped to put out the forest fire that had threatened its Eleonore gold project. Cooler temperatures and shifting winds helped to extinguish the smoke at the site as well.

About a week ago, Goldcorp evacuated the employees as the forest fire located roughly 100 kilometres from Eleonore was progressing with prevailing winds toward the mine site. Goldcorp was working with local and provincial authorities to step up safety measures and protect the health of all people of the locality. The company also kept a team at the site to manage and implement preventive emergency measures and stated that the entire crew was safe.

Goldcorp also stated that there was no damage of the infrastructure and equipment at Eleonore which included power and communications. The company also said that the evacuation of the project would have no material impact on the construction schedule.

Recently, Freeport McMoRan Copper and Gold Inc. (FCX) also announced a force majeure on shipments from the PT Freeport Indonesia (PT-FI) Grasberg mine. This ensued after a tunnel collapsed in the mine on May 14, claiming 28 lives.

Though the accident had spared the area of operations, Freeport temporarily suspended mining and processing activities as part of the rescue and recovery operation. However, the company has resumed open pit mining, and is concentrating on activities at its Grasberg operations in Papua after it received approval from Indonesia's Department of Energy and Mineral Resources (DEMR). The mine is now operating at full capacity.


Goldcorp is one of the world's fastest growing senior gold producers and it provides its shareholders with superior returns from high quality assets. Goldcorp's first-quarter 2013 adjusted earnings (excluding one-time items) of 31 cents a share missed the Zacks Consensus Estimate of 40 cents and were well below 50 cents a share earned in the year-ago quarter.
Profit, as reported, amounted to $309 million or 33 cents per share in the reported quarter, down roughly 35% from $479 million or 51 cents in the prior-year quarter, hurt by a double-digit decline in sales.

Goldcorp posted revenues of $1.02 billion in the quarter, down roughly 16% year over year. It missed the Zacks Consensus Estimate of $1.39 billion.

Goldcorp currently carries a Zacks Rank #4 (Sell).

Other companies in the mining industry with favorable Zacks Rank are NovaGold Resources Inc. (NG) and Lake Shore Gold Corp. (LSG). Both retain a Zacks Rank #2 (Buy).