US markets down, March 4-8: Yamana, Goldcorp, Alamos, Kinross

The Dow Jones Industrial Average fell 2.21% to finish the week at 25,450.24, and the S&P 500 Index lost 2.20% to end the week at 2,743.07. Spot gold rose US$4.80 per oz. to US$1,297.70 per oz. gold.

Yamana Gold, Glencore and Goldcorp have reached an agreement under which the companies propose to integrate Yamana’s wholly owned Agua Rica project with the Alumbrera mine in Argentina’s Catamarca province. (All three companies hold interests in Alumbrera.) The agreement envisions the Agua Rica project developed and operated using the infrastructure and facilities at Alumbrera. Under the arrangement, Yamana will contribute its 100% interest in the Agua Rica project and its 12.5% stake in Alumbrera, while Glencore and Goldcorp will contribute their 50% and 37.5% interests in Alumbrera.

The three companies have set up a technical committee to review and evaluate the project and expect to complete a prefeasibility-level study this year, and a feasibility study next year, leading to a new environmental impact assessment. Agua Rica hosts a long-life copper resource with gold, silver and molybdenum, while Alumbrera offers infrastructure. The companies say preliminary studies show a potential mine life in excess of 25 years, with annual production of 236,000 tonnes (520 million lb.) copper-equivalent metal, including gold, molybdenum and silver during the first decade of operations. Shares of Yamana Gold rose US16¢ to US$2.65, and Goldcorp’s advanced US17¢ to US$10.72.

News that Alamos Gold got an operating permit for its Kirazli project in Turkey helped lift the company’s shares 5% to US$5.06 apiece. The permit from the Turkish Department of Energy and Natural Resources means Alamos can start earthworks on the project’s open pit. Alamos expects to spend $75 million this year to finish the water reservoir, and ramp up major construction activities and earthworks. The other $60 million of Kirazlı’s $152-million capital budget will be spent in 2020, with production expected by the end of 2020.

Kinross Gold finished US15¢ per share higher at US$3.36. The company has appointed Andrea Freeborough as its new chief financial officer effective May 1, replacing Tony Giardini, who is leaving to pursue new opportunities.