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Goldcorp Achieves Record Gold Production in 2007; Further Growth Forecast for 2008

Posted on: Tuesday, 8 January 2008, 09:00 CST

All Amounts in $US unless stated otherwise

GOLDCORP INC. (TSX: G)(NYSE: GG) announced today that its gold production in 2007 increased 35% to 2.29 million ounces, at the high end of its guidance range of 2.2 million to 2.3 million ounces. Gold production in the fourth quarter of 2007 was a record 633,000 ounces.

Total cash costs for 2007 have not yet been compiled, but are expected to be slightly higher than the guidance of $150 per gold ounce, due primarily to lower copper prices realized during the fourth quarter.

"Goldcorp ended the year with its highest quarterly gold production ever," said Kevin McArthur, President and Chief Executive Officer. "We believe 2008 will extend our peer-leading growth profile, with gold production expected to increase 14% over 2007. This growth comes from high quality, long-lived assets with intriguing exploration potential and strong cash flows. Goldcorp's business continues to expand substantially - building big mines in safe countries, with over 80% of its gold production expected from NAFTA countries in 2008. This impressive value-creation remains unmatched among senior gold producing companies."

Goldcorp also provided guidance on production, cash costs and spending for the 2008 year. The Company expects to produce approximately 2.6 million ounces of gold at a total cash cost of approximately $250 per ounce. Assumptions used to forecast cash costs are by-product silver price of $13 per ounce, by-product copper price of $3 per pound and parity between US and Canadian dollars.

Mine-by-mine gold production statistics for 2007 and estimated 2008 production are as follows:

 Mine                      2007 Actual     2008 Forecast ------------------------------------------------------- Red Lake                      701,000           740,000 Porcupine                     155,000(1)        330,000 ------------------------------------------------------- Musselwhite                   153,000(1)        240,000 Wharf                          58,000            65,000 Marigold (66.7%)               94,000           100,000 ------------------------------------------------------- San Dimas                     135,000           140,000 Los Filos/Nukay                72,000           280,000 El Sauzal                     307,000           200,000 ------------------------------------------------------- Penasquito                         --            70,000                           ----------------------------- Alumbrera (37.5%)             231,000           190,000 Marlin                        227,000           225,000 San Martin                     45,000            20,000 ------------------------------------------------------- Total (Continuing Ops)      2,178,000         2,600,000 ------------------------------------------------------- Discontinued Mines(2)         109,000                -- ------------------------------------------------------- Total (Reported)            2,287,000         2,600,000 ------------------------------------------------------- ------------------------------------------------------- (1) 2007 production based on 51% ownership of Porcupine and     68% ownership of Musselwhite. The Company has since     acquired 100% ownership of both mines.  (2) Includes Amapari, Peak and La Coipa. 

The 2008 total cash cost forecast is approximately $250 per ounce, which is higher than 2007 due to following factors:

- The 2007 JV asset swap adds over 260,000 ounces of gold production in Canada, but increases total cash costs by approximately $30.00 per gold ounce.

- The first full year of commercial production at Los Filos mine in Mexico is expected to increase the Company's total cash costs by approximately $20.00 per gold ounce in 2008.

- The 2008 forecast by-product copper price of $3.00 per pound is below the average copper price realized during 2007, contributing to an increase in total cash costs of approximately $35.00 per gold ounce.

- Cost inflation and foreign exchange effects also result in increased total cash costs.

The following graph provides a quarterly break-down of gold production and total cash costs expected in 2008:

To view graph please click on the following link: http://www.ccnmatthews.com/docs/GOLDGR1.JPG

Production is expected to rise throughout the year as cash costs decrease due to a sequential ramp-up in production at Los Filos and increased second half production at Red Lake following the completion of the mine expansion project.

Canada: Goldcorp's Production Base

Goldcorp's Canadian mines represent over 50% of the Company's 2008 gold production. Forecast 2008 gold production at Red Lake mine of 740,000 ounces is expected to increase in the second half as the Company concludes its expansion project in the second quarter. Ventilation upgrades underway will bring a threefold increase in ventilation capacity, enabling the Red Lake team to carry out the next phase of mine development toward a goal of one million ounces of annual gold production in the latter stages of the five-year plan. Opportunities to grow production at the Company's two other large Ontario mines, Musselwhite and Porcupine, are currently being evaluated. The Eleonore project in Quebec is expected to be Goldcorp's next gold mine in Canada with completion of a feasibility study at year end.

Mexico: Goldcorp's Growth Engine

Los Filos reached commercial production on January 1, 2008. Gold production is expected to ramp up throughout the year as ounces of gold stacked on the heap leach pads are placed under leach. The focus in 2008 will be on continued production ramp-up and expansion of the leach pad. Production at El Sauzal will decline as average gold grade decreases. At San Dimas, planned investment will continue throughout 2008 with the goal of increasing gold production from the current production rates of 130,000 gold ounces and 7 million silver ounces to over 180,000 gold ounces and over 12 million ounces of silver over the next two years. The Company continues to expect the first Penasquito gold pour from the oxide heaps in 2008. Penasquito 2008 goals include construction of the first SAG line and continued optimization studies to maximize opportunities at what will be the largest mine in Mexico.

Investing in the Future

Capital expenditures for 2008 are forecast at $1.2 billion, including $700 million at Penasquito and $150 million at the Eleonore project. This excludes any capital for the Pueblo Viejo project in the Dominican Republic. The current five year plan for capital spending, excluding Pueblo Viejo, is as follows:

 Year               $ Millions 2008               $    1,200 2009               $    1,100 2010               $      750 2011               $      550 2012               $      350 

Exploration in 2008 will total $150 million, of which approximately half is expected to be expensed. Other than the primary goal of replacing mined ounces in 2008, particular emphasis will be placed on expansion opportunities at Red Lake and Musselwhite, resource expansion at Eleonore, and development of underground concepts and regional targets at Penasquito.

Financial Forecast

DD&A is expected to be approximately $215 per ounce of gold in 2008. General and administrative expense will total approximately $80 million.

Looking further ahead, total cash costs are expected to drop in the later years of the Company's five year plan as production from Penasquito project ramps up. The following graph provides details of gold production and total cash costs expected for the five year plan:

To view graph please click on the following link: http://www.ccnmatthews.com/docs/GOLDGR2.JPG

Total cash cost remains below $250 per ounce throughout the forecast five year period and production growth over the same period exceeds 50% - both measures the best among the Company's peer group.

2007 Fourth Quarter and Year-End Conference Call

Goldcorp will release complete financial results for the fourth quarter and 2007 year before market on Thursday, February 21. A conference call to discuss these results will also be held on February 21 at 10:00 a.m. PST. Participants may join the call by dialing 1-866-226-1799 toll free or 416-641-6129 outside Canada and the US. A recorded playback of the call can be accessed after the event until March 21, 2008 by dialing 800-408-3053 or 416-695-5800 for calls outside Canada and the US. Passcode: 324578. The live call and archived audio webcast will also be available at www.goldcorp.com.

Goldcorp is the world's fastest growing, lowest-cost multi-million ounce gold producer with operations throughout the Americas. Gold production and reserves from the Company's strong portfolio of mines and projects remains 100% unhedged.

The Company has included a non-GAAP performance measure, total cash cost per gold ounce, throughout this document. The Company reports total cash costs on a sales basis. In the gold mining industry, this is a common performance measure but does not have any standardized meaning, and is a non-GAAP measure. The Company follows the recommendations of the Gold Institute standard. The Company believes that, in addition to conventional measures, prepared in accordance with GAAP, certain investors use this information to evaluate the Company's performance and ability to generate cash flow. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.

Cautionary Note Regarding Forward-Looking Statements

Safe Harbor Statement under the United States Private Securities Litigation Reform Act of 1995: Except for the statements of historical fact contained herein, the information presented constitutes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements, including but not limited to those with respect to the price of gold, silver, copper, zinc and lead, the timing and amount of estimated future production, costs of production, reserve determination and reserve conversion rates involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievement of Goldcorp to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, risks related to the integration of acquisitions, risks related to international operations, risks related to joint venture operations, the actual results of current exploration activities, actual results of current reclamation activities, conclusions of economic evaluations, changes in project parameters as plans continue to be refined, future prices of gold, silver and copper, zinc and lead as well as those factors discussed in the section entitled "General Development of the Business - Risks of the Business" in Goldcorp's Form 40-F on file with the Securities and Exchange Commission in Washington, D.C. and Goldcorp's Annual Information Form on file with the securities regulatory authorities in Canada. Although Goldcorp has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance 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.

 Contacts: Goldcorp Inc. Jeff Wilhoit Vice President, Investor Relations (604) 696-3074 (604) 696-3001 (FAX) Email: info@goldcorp.com Website: www.goldcorp.com

SOURCE: Goldcorp Inc.

Source: MARKET WIRE

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