BC Business
Éléonore gold project in Quebec
Less than golden At the end of a challenging year of low metals prices and problems at two new mines, Goldcorp Inc. reported a fourth-quarter loss of $4.3 billion. In an effort to shore up its balance sheet, the Vancouver-based gold miner announced Friday it would cut dividends, paying two cents per share quarterly rather than monthly starting on April 1. Net annual loss for 2015 was $4.2 billion, or $5.14 per share.
The loss was recorded despite fourth-quarter revenues of $1.07 billion, well above the $835 million it took in during the same period in 2014. Goldcorp began production of two mines in 2015, Éléonore in northern Quebec and Cerro Negro in Argentina. Both faced challenges during their first year, including an unexpected degree of rock folding at Éléonore and work stoppages at Cerro Negro. However, the company still produced 909,400 ounces of gold in the fourth quarter, defying analysts’ expectations of 900,500 ounces. “Goldcorp achieved 2015 production and all-in sustaining cost guidance while bringing two large new gold mines into production,” said CEO Chuck Jeannes in a press release. He also noted the continued metal price volatility throughout the year. Efforts were taken by the company to lower costs, including workforce reductions at corporate and regional offices, and at certain mine sites. “The backbone of our portfolio remains well-positioned for future success.”
Jeannes will be stepping down as CEO on February 29, and David Garofalo, the former president of HudBay Minerals, will take over.
Rate riseBC Hydro is looking to raise rates by four per cent, starting April 1. The increase is part of the 10-Year Rates Plan announced by the provincial government in 2013 which capped increases at four per cent (fiscal 2017), 3.5 per cent (2018) and three per cent (2019).
On Friday, BC Hydro filed an application for an interim one-year rate with the BC Utilities Commission. Typically the utility would file an application for the entire three-year period from fiscal 2017 to fiscal 2019. A press release explained that due to uncertainty in the mining and LNG sectors, BC Hydro opted to file an interim rate application for 2017 now and the final revenue requirements application later next summer. The extra time will allow BC Hydro to better calculate its long-term changes in electricity demand.
Mining rules Tougher penalties for mining companies that fail to follow safety rules are the latest measure taken by the provincial government following the Mount Polley environmental disaster.
On Thursday, Energy and Mines Minister Bill Bennett introduced amendments to the Mines Act that will allow the government to impose financial penalties without involving the courts. The amendments also included increased penalties available for court prosecutions, from a maximum $100,000 to $1 million, along with a maximum of three years imprisonment. These changes to the Mines Act will bring it in line with the other provincial natural resource legislation, including the Environmental Management Act.
There have been two investigations of the August 2014 Mount Polley disaster, in which a tailings pond owned by Imperial Metals was breached and emptied its mining waste into Polley Lake. The amendments to the Mines Act are part of the government’s ongoing actions to implement the 26 recommendations of the independent panel and the chief inspector of mines following their respective investigations.