Goldcorp to Buy New Gold's Stake in El Morro Copper-Gold Project

Goldcorp Inc. (TSX:G,NYSE:GG) announced that it’s entered into an agreement to purchase New Gold Inc.’s (TSX:NGD,NYSE:NGD) 30-percent stake in the Chile-based El Morro copper-gold project. Once the transaction goes through, Goldcorp will wholly own the project.
As quoted in the press release:

Under the terms of the agreement,Goldcorp will pay New Gold $90 million in cash at closing and a 4% gold stream on future gold production from El Morro. New Gold will make ongoing payments of $400 per ounce of gold delivered under the contract, subject to a 1% per annum adjustment (compounded annually, commencing on the first anniversary of the agreement) once 217,000 ounces have been delivered. At December 31, 2014 , El Morro had proven and probable gold reserves of 8.92 million ounces (100% basis) ¹ .

Goldcorp also announced today that it has reached an agreement with Teck Resources Limited (“Teck”) (TSX: TCK.A & TCK.B, NYSE: TCK) to combine their respective interests in the El Morro (including the 30% interest to be acquired from New Gold as described above) and Relincho projects in Chile into a 50/50 joint venture.

¹ Estimated in accordance with CIM Definition Standards and National Instrument 43-101 as required by Canadian securities regulatory authorities. For a breakdown and additional details on tonnes, grade and ounces, see Goldcorp’s 2014 Annual Information Form.

Chuck Jeannes, president and CEO of Goldcorp, commented:

This transaction allows us to consolidate the ownership of El Morro and work with Teck to jointly develop the Relincho and El Morro deposits in a way that is expected to deliver significant synergies to our respective stakeholders and shareholders.

Click here to read the full Goldcorp Inc. (TSX:G,NYSE:GG) press release.