Goldcorp celebrates first pour at Red Lake mine

Toronto-based Goldcorp stepped into the spotlight during the August 2-8 report period as the company celebrated the pouring of its first gold bar from the High Grade zone at its Red Lake mine in northwestern Ontario. About 64,000 oz. are to be cranked out by year-end, rising to 240,000 oz. annually thereafter.

The company announced it will simplify its share structure by merging with affiliate CSA Management and then having only one class of shares. Over the week, Goldcorp’s class-A shares rose $1.25 to $9.95; its class-B shares climbed 25 to $12, while CSA’s class-A shares soared $8.70 to $18.70.

Meanwhile, gold continued its slow, summer tumble, falling US$4.85 over the week on light trading to reach a London morning fix of US$272.30 per oz. on Aug. 9. The yellow metal is still under pressure from a red-hot U.S. economy that has pushed up the value of the U.S. dollar relative to most currencies and U.S.-dollar denominated commodities.

Canada’s major gold producers were mixed over the week: Placer Dome, which has had its work contract at the Las Cristinas gold property in Venezuela extended by one year, slipped 10 at $12.60; Barrick Gold fell 45 to $23.80; Franco-Nevada Mining fell 5 to $15.15; TVX Gold rose 14 to $3.16; Cambior fell 3 to 58; and Kinross Gold, now a penny stock, was up 4 to 99.

Among the gold juniors, partners Semafo and Etruscan Resources announced higher production forecasts for their developing Samira Hill gold project in Niger. By mining both the Samira Hill and nearby Libiri deposits, the partners expect to produce 150,000 oz. in the first year of production, scheduled to start in mid-2001. Semafo rose 6 to 47, whereas Etruscan slipped 1 to 60.

McWatters Mining fell 2 to 33 as the gold miner announced it had permanently shut down underground operations at its Sigma-Lamaque complex in Val d’Or, Que. The company had a difficult second quarter at Sigma-Lamaque’s open-pit operations, with gold production down 5,092 oz. to 12,349 oz. and total production costs rising US$15 to US$258 per oz. Overall, the company lost $1.3 million during the quarter, on revenue of $16.5 million.

Turning to nickel miners, Falconbridge was unchanged at $16.85 as 1,260 unionized workers at the Sudbury division entered their second week of strike action. The strike, coupled with a rock burst in April at the Fraser mine in Sudbury, has led the company to declare partial force majeure on its copper deliveries, which will be reduced 1,600 tonnes per month from 2,600 tonnes. Among Falco’s rivals, Inco gained 65 to $23.30, while Sherritt International was up 5 to $4.38.