goldcorp-teck joint corridor project ex relincho and los morros.pdf

8/17/2019 Goldcorp-Teck joint Corridor Project ex Relincho and Los Morros.pdf

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Project Corridor

Building a Better Project Together

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August 27, 2015 | Santiago, Chile


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Forward Looking StatementCautionary Note Regarding Forward-Looking Statements

These slides contains "forward-looking statements", within the meaning of the United States Private Securities Litigation Reform Act of 1995 Section 21E of theUnited States Securities Exchange Act of 1934, as amended, Section 27A of the United States Securities Act of 1933, as amended and “forward-lookinginformation” within the meaning of applicable Canadian securities legislation, concerning the business, operations and financial performance and condition ofGoldcorp and Teck. Forward-looking statements, which are all statements other than historical fact, include, but are not limited to, statements with respect tothe anticipated benefits of the Project Corridor transaction the (“Transaction”), the ability of the parties to satisfy the conditions of and to complete theTransaction and the New Gold transaction (“New Gold Transaction”), the development of Project Corridor as a mine, the future price of gold, silver, copper,lead, zinc and other metals, the estimation of mineral reserves and resources, including the combined reserves of Goldcorp and Teck, the realization ofmineral reserve estimates, the timing and amount of estimated future production, costs of future 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 foradditional capital, government regulation of mining operations, environmental risks, unanticipated reclamation expenses, timing and possible outcome ofpending litigation, title disputes or claims and limitations on insurance coverage. Generally, these forward-looking statements can be identified by the use offorward-looking terminology such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", "believes" orvariations of such words and phrases or statements that certain actions, events or results “will”, "may", "could", "would", "might" or "will be taken", "occur" or"be achieved" or the negative connotation thereof.

Forward-looking statements are made based upon certain assumptions and other important factors that, if untrue, could cause the actual results, performancesor achievements of Goldcorp or Teck, including in respect of the Transaction, the New Gold Transaction and the development and operation of ProjectCorridor, to be materially different from future results, performances or achievements expressed or implied by such statements. Such statements andinformation are based on numerous assumptions regarding present and future business strategies and the environment in which Goldcorp and Teck willoperate in the future, including the price of commodities, anticipated costs and ability to achieve goals. In respect of the forward-looking statements concerning

the anticipated timing of closing of the Transaction and the New Gold Transaction, Goldcorp and Teck have provided them in reliance on certain assumptionsthat they believe reasonable at this time, including assumptions as to conditions to closing of the Transaction and the New Gold Transaction being satisfied in atimely manner. Certain important factors that could cause actual results, performances or achievements to differ materially from those in the forward-lookingstatements include, among others, the Transaction or the New Gold Transaction not closing when planned, commodity price volatility, discrepancies betweenactual and estimated production, mineral reserves and resources and metallurgical recoveries, mining operational and development risks, litigation risks,regulatory restrictions (including environmental regulatory restrictions and liability), activities by governmental authorities (including changes in taxation),currency fluctuations, the speculative nature of mineral exploration, the global economic climate, dilution, share price volatility, competition, loss of keyemployees, additional funding requirements and defective title to mineral claims or property. Although Goldcorp and Teck have attempted to identify importantfactors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors thatcause actions, events or results not to be as anticipated, estimated or intended.

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Forward Looking StatementForward-looking statements are subject to known and unknown risks, uncertainties and other important factors that may cause the actual results, level ofactivity, performance or achievements of Goldcorp or Teck to be materially different from those expressed or implied by such forward-looking statements,including but not limited to: the risk that the Transaction or the New Gold Transaction will not close when planned, risks related to the uncertainty associatedwith preliminary economic assessments, which do not purport to establish the legal or commercial viability of mineral deposits; risks related to the integration ofacquisitions; risks related to international operations, including economic and political instability in foreign jurisdictions in which Goldcorp and Teck operate;risks related to current global financial conditions; risks related to joint venture operations; actual results of current exploration activities; environmental risks;future prices of gold, silver, copper, lead, zinc and other metals; possible variations in ore reserves, grade or recovery rates; mine development and operatingrisks; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion ofdevelopment or construction activities; risks related to indebtedness and the service of such indebtedness, as well as those factors discussed in the sectionentitled “Description of the Business – Risk Factors” in Goldcorp’s annual information form for the year ended December 31, 2014 available at www.sedar.com and in the section entitled “Description of the Business – Risk Factors” in Teck’s annual information form for the year ended December 31, 2014 available at

www.sedar.com. Although Goldcorp and Teck have attempted to identify important factors that could cause actual results to differ materially from thosecontained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be noassurance 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 andaccordingly are subject to change after such date. Except as otherwise indicated by Goldcorp and Teck, these statements do not reflect the potential impact ofany non-recurring or other special items or of any dispositions, monetizations, mergers, acquisitions, other business combinations or other transactions thatmay be announced or that may occur after the date hereof. Forward-looking statements are provided for the purpose of providing information aboutmanagement’s current expectations and plans and allowing investors and others to get a better understanding of our operating environment. Goldcorp andTeck do not undertake to update any forward-looking statements that are included or incorporated by reference in this document, except in accordance withapplicable securities laws.

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http://www.sedar.com/http://www.sedar.com/http://www.sedar.com/http://www.sedar.com/


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Don Lindsay

President & CEO

Teck Resources Limited

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Chuck Jeannes

President & CEO

Goldcorp Inc.

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Introduction

• Teck and Goldcorp have combined Relincho and ElMorro projects and formed a 50 / 50 joint venture

• Committed to building strong, mutually beneficialrelationships with stakeholders and communities

• Benefits of combining projects include: – Significantly lower capital costs and improved capital efficiency

– Significantly reduced environmental footprint

– Enhanced community benefits

– Longer mine life

– Improved returns over either standalone project

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Key Transaction Terms

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Assets • El Morro and Relincho combined in one company

Ownership • 50% Goldcorp and 50% Teck

Executive &Operating Model

• Operate as a standalone company with its own

employees and management• Executive team will report to a Board of Directors

Board of Directors

• Comprised of 3 Goldcorp and 3 Teck nominees• Chairman to rotate on an annual basis between

Goldcorp and Teck

Funding • Costs to be funded on a 50 / 50 basis


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Project Location

Service Layer Credits: Copyright ©2014 Esri8


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Operating Plan

• Mining at El Morro and Relincho sites

• Conveyor to transport ore from the El Morro site to a

single mill at the Relincho site

• Common infrastructure to support Corridor (as illustratedon slide 11)

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10

Source: “Project Location.” -28.395839, -70.486738, 4679ft. Google Earth.February 8, 2015. April 23, 2015.

Desalination

Desalination

Power

Mine and Mill

Mine

Port

Relincho

Site

El MorroSite

Before Project Corridor – Duplicate infrastructure

Pipelines

Power Line

and Mill

Pipelines:

Water

Pipelines:Water &

Concentrate

Tailings

Tailings

Power

Port


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11

Source: “Project Location.” -28.395839, -70.486738, 4679ft. Google Earth.February 8, 2015. April 23, 2015.

Mine

Tailings

Desalination

Port

Mine and Mill

Project Corridor – Common infrastructure

Conveyor & Utilities

Power Pipelines:

Water

Pipeline

Power Line

Conveyor & Utilities

Road


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Project Topography

E l e v a t i o n

( m ) – 7 x V e r t i c a l E x a g g e r a t i o n

Huasco Mining, Milling, Tailings Mining

90km 40km

Vallenar

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Conveyor

Service Layer Credits: Copyright ©2014 Esri


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Working with People & Communities

• New project, new company, newapproach

• Community and stakeholders willbe asked to participate jointly in

the development of theengagement process

• Assisted by two independentorganizations with expertise incommunity engagement

• Community input will beincorporated throughout projectdevelopment and operations

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Enhanced Community Benefits

Enhanced Mine Life:

• 32 year mine life with extension potential

• Longer term employment

• More economic growth opportunities

• Development of robust community investment programs

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El MorroLooking Northeast (4,000 m elevation)


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Environmental Benefits

Significantly Reduced Environmental Footprint:

• Common tailings facility relocated from agriculturally important

Huasco River watershed to drier Quebrada Algarrobal area

• Single mill, port and desalination plant and common service

infrastructure – road, pipeline and powerline

• Desalinated seawater used for processing

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RelinchoLooking East (2,000 m elevation)


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Capital Smart – Phased Development

Phase 1a Initial Production of Relincho ores

Phase 1b Transition to El Morro ores

Phase 2 Transition to Relincho ores

• Lower cost to first ore;high grade, low stripstarter pit

• Initial mill throughput ofapproximately 90 ktpd

• Transition to highergrade El Morro ore

•

Mill throughput ofapproximately 110 ktpddue to softer ore

• Option to blend oresand expand throughput

• Transition back toRelincho ore once ElMorro is depleted

• Potential expansion toa mill throughput of175 ktpd

Phase 1 development concept is a single line mill (90-110ktpd) whichproduces higher metal product ion than either standalone project

Average production of 190,000 tonnes copper and 315,000 ounces gold

per year over f irst 10 years of operation

Note: Conceptual based on preliminary design from the Preliminary Economic Assessment

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Capital Smart

Separate Projects1 Combined Project 2

Construction~US$3.5B3

Operating Years 1-3El Morro: US$3.9B

Relincho: US$4.5B

More efficient capital deployment

1. Capital expenditure forecasts for El Morro and Relincho in 2011 and 2013 dollars, respectively, based on Feasibility Studies (February 2012) for

El Morro and Relincho (December 2013)2. Conceptual based on preliminary design and estimates from the Preliminary Economic Assessment3. Capital estimate for Phase 1a based on preliminary design shown in 2015 dollars on an unescalated basis

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Total Capital: US$8.4B

Operating cash flow

in early years helps fund

total development costs

Reduced scope and improved

capital efficiency through

common infrastructure


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18

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32

El Morro Relincho Corridor

Long Mine Life with Extension Potential

32 year mine life based on

current reserves

Multi-generational, scalable asset

Note: Mine life is based on current reserve and assumed production rate outlined in the Preliminary Economic Assessment which includes an

expansion during Phase 2 of the Project.Note: Mineral Resources are reported exclusively from Mineral Reserves. Figures rounded, see Appendix A for additional information.

Improved returns, increased optionality, and resource expansion potential

Years of Mine Life Combined Resources

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El MorroMillion

TonnesCopper (%) Gold (g/t)

Proven and Probable Reserves 599 0.49% 0.46

Measured & Indicated Resources 92 0.42% 0.42

Inferred Resources 678 0.35% 0.30

RelinchoMillion

TonnesCopper (%) Molybdenum (%)

Proven & Probable Reserves 1239 0.37% 0.017%

Measured & Indicated Resources 397 0.33% 0.011%

Inferred Resources 610 0.38% 0.013%

0

5.000

10.000

15.000

20.000

25.000

Reserves M&I Inferred

C

o n t a i n e d C o p p e r E q u i v a l e n t

( m i l l i o n p o u n d s )

El Morro

Relincho

Corridor


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Project Summary

Note: Conceptual based on preliminary design from the PEA

1. Average production rates are based on the first full ten years of operations2. Total copper and gold contained in mineral reserves as reported separately by Teck and Goldcorp; refer Appendix A.3. Capital estimate for Phase 1a based on preliminary design shown in 2015 dollars on an unescalated basis

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Initial Capital

~$3.53

billion

Gold Production1

~315,000

ounces per year

Copper in Reserves2

16.6billion pounds

Mine Life

Copper Production1

~190,000

tonnes per year

Gold in Reserves2

8.9million ounces32years with extensionpotential


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Copper Development Projects in theAmericas

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Corridor is one of the largest open pit copper development projects in the Americas on thebasis of copper contained in Proven and Probable Reserves

-

5.000

10.000

15.000

20.000

25.000

R a

d o m

i r o

T o m

i c

C o r r

i d o r

E l A r c o

Q u e

b r a

d a

B l a n c a

I I

Q u e

l l a v e c o

A g u a

R i c a

R e

l i n c

h o

E l M o r r o

C a s

i n o

S c

h a

f t C r e e

k

G a

l o r e

C r e e

k

R i o B l a n c o

C o p p e r E q u i v a l e n t i n R e s e r v e s ( M l b s )

Copper-equivalent contained in Reserves (Mlbs)

(North & South American Copper Projects)

Note: Copper equivalent reserves calculated using $3.25/lb Cu and $1,200/oz Au. Does not include copper resource projects that are currently in construction

Source: SNL Metals & Mining, Thomson One Analytics, and company disclosures.


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Next Steps

• Continue community engagement and baseline work

• Commence Project Corridor Pre-Feasibility Study in early 2016

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Summary

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• Common sense, ‘capital smart’ partnership

• Significantly lower capital costs and improved capital efficiency

• Significantly reduced environmental footprint

• Enhanced community benefits

• Longer mine life

• Improved returns over either standalone project


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Appendix A: Reserve and Resource Disclosure

The following mineral reserve and resource information is as at December 31, 2014. All mineral resources disclosed below are reported exclusive ofmineral reserves.

El Morro — Reserves (100% basis) (1)(3)(5)

El Morro — Resources (100% basis) (1)(2)(4)(5)

Notes:

1) All Mineral Reserves and Mineral Resources have been estimated in accordance with the CIM Definition Standards.

2) Mineral Resources which are not Mineral Reserves do not have demonstrated economic viability.

3) Goldcorp has estimated El Morro mineral reserves assuming commodity prices of US$1,300 per ounce of gold and US$3.00 per pound of copper.

4) El Morro’s mineral resources are estimated using commodity prices of US$1,500 per ounce of gold and US$3.50 per pound of copper.

5) The mineral reserves and mineral resources are reported at a 0.2% Copper equivalent cut-off grade, with 67.3% gold recovery and 86.6% copperrecovery.

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Grade Contained Metal

Category

Tonnes (millions) Gold (g/t) Copper (%) Gold (millions of

ounces)

Copper (millions of pounds)

Proven 321.81 0.56 0.55 5.82 3,876.59

Probable 277.24 0.35 0.43 3.10 2,626.36

Proven + Probable 599.05 0.46 0.49 8.92 6,502.95


Category

Tonnes (millions) Gold (g/t) Copper (%) Gold (millions of ounces) Copper (millions of pounds)

Measured 19.79 0.53 0.51 0.34 223.33

Indicated 72.56 0.38 0.39 0.88 630.00

Inferred 678.07 0.30 0.35 6.45 5190.00


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Appendix A: Reserve and Resource Disclosure Cont.

The following mineral reserve and resource information is as at December 31, 2014. All mineral resources disclosed below are reported exclusive ofmineral reserves.

Relincho — Reserves (1)(2)(3)

Relincho — Resources (1)(2)(3)(4)(5)

Notes:

1) All Mineral Reserves and Mineral Resources have been estimated in accordance with the CIM Definition Standards.

2) Mineral Resources which are not Mineral Reserves do not have demonstrated economic viability.

3) Teck has estimated Relincho mineral reserves and resources assuming commodity prices of US$2.80 per pound of copper and US$13.70 perpound of molybdenum.

4) Mineral resources are reported separately from, and do not include that portion of the mineral resources reported as reserves.

5) Mineral Resources are contained within a conceptual ultimate pit shell defined with Measured, Indicated and Inferred blocks using the sameeconomic and technical parameters as used for mineral reserves and are reported considering a variable cut-off grade based on a marginal valueof US$5.59/t.

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Category Tonnes (millions) Copper (%) Molybdenum (%) Copper (millions of

pounds)

Molybdenum (millions of

pounds)

Proven 435.30 0.38 0.016 3,646.75 153.55

Probable 803.80 0.37 0.018 6,556.70 318.97

Proven + Probable 1,239.10 0.37 0.017 10,106.65 464.36


Category Tonnes (millions) Copper (%) Molybdenum (%) Copper (millions of

pounds)

Molybdenum (millions of

pounds)

Measured 79.90 0.27 0.009 475.60 15.85

Indicated 317.10 0.34 0.012 2,376.89 83.89

Inferred 610.80 0.38 0.013 5,117.02 175.06


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Appendix A: Reserve and Resource Disclosure Cont.

These tables use the terms “Measured”, “Indicated” and “Inferred” Resources. United States investors are advised that while such terms arerecognized and required by Canadian regulations, the United States Securities and Exchange Commission does not recognize them. “InferredMineral Resources” have a great amount of uncertainty as to their existence, and as to their economic and legal feasibility. A significant amountof exploration must be completed in order to determine whether an Inferred Mineral Resource may be upgraded to a higher category. UnderCanadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or other economic studies. United States investorsare cautioned not to assume that all or any part of Measured or Indicated Mineral Resources will ever be converted into Mineral Reserves.United States investors are also cautioned not to assume that all or any part of an Inferred Mineral Resource exists, or is economically or legallymineable.

The projected mine life of the combined project from the PEA is based on mineral reserves only and does not include other mineral resources.The financial analysis under the PEA of Project Corridor assumed commodity prices of US$1,200 per ounce of gold, US$3.25 per pound ofcopper and US$10.00 per pound of molybdenum. The projected mine life of the combined project and other results of the PEA disclosed in thisnews release have been reviewed and approved by Gil Lawson, P.Eng., Vice President of Geology and Mine Planning, Goldcorp and RodrigoMarinho, P.Geo., Technical Director, Reserve Evaluation, Teck, each of whom is a qualified person as defined under NI 43-101.

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goldcorp-teck joint corridor project ex relincho and los morros.pdf

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