Goldcorp CEO: Stable politics draw investment to state
Global economies ebb and flow like the tide, but Nevada hasn’t lost any of its luster as one of the world’s premier places to mine for gold.
The mining boom that has powered northeastern Nevada’s economy since the late 2000s is as strong as ever, says Chuck Jeannes, president and chief executive officer of Vancouver-based Goldcorp.
Jeannes, a graduate of Reno High School and the University of Nevada, Reno, and a longtime Reno resident, now heads up the largest mining company in Canada and Mexico.
Goldcorp’s interests in Nevada are puny compared to the state’s largest mining companies Barrick Gold Corp. and Newmont Mining Corporation, which employ several thousand miners each but that doesn’t mean Goldcorp and other senior mining companies don’t think Nevada is still among the best mining jurisdictions in the world.
Lengthy permitting processes and other bureaucracy aside, Nevada simply makes sense for a host of reasons, Jeannes said in an interview at Goldcorp’s Reno offices on Neil Road last week.
Goldcorp’s lone Nevada operation, the Marigold Mine in Humboldt County East of Winnemucca, produced about 100,000 ounces of gold in 2012 a fraction of the company’s total production of approximately 2.5 to 2.8 million ounces.
Goldcorp, which operates the Marigold site in a joint venture with Barrick, has 11 mines and five others in development throughout the Western Hemisphere, including Canada, Mexico, Argentina, Chile, and Guatemala. Jeannes came aboard as executive vice president and became president and CEO four years ago.
“While we are a small player in Nevada, we are a very large miner globally, and so we look at a lot of different jurisdictions when deciding where to spend our exploration dollars and where to focus our business development efforts. Nevada gets a lot of attention it’s a good place to do business,” Jeannes says.
Among the foremost reasons Nevada remains a prime place for mining companies to invest, Jeannes says, are its stable political and tax environments, the security and quality of its workforce, and a stable judicial system that offers recourse in case of potential disputes.
And, of course, it’s the gold.
“There is geologic opportunity,” Jeannes says. “It is more mature than 10, 20 or 30 years ago, but that doesn’t mean every ounce of gold has been found. To the contrary, there still are discoveries to be made here and we will be doing our share to try and do more business in Nevada.”
Though most of Goldcorp’s exploration efforts are focused close to its existing mine sites, including its flagship Red Lake property in northern Canada, that country’s largest gold mine, Goldcorp holds a land package encompassing 29 square miles in Humboldt County. Future exploration could significantly expand the scope of mining operations at the Marigold site.
The Marigold mine employs roughly 200 miners again a fraction of the company’s more than 14,000 employees. The company employs about 20 professional staffers at it Neil Road offices.
“There is still a lot of exploration potential,” Jeannes says. “Target types and depths change. Over the years our thinking has changed and we are testing some new theories there.”
Exploration in the state actually has become easier over the past few years, Jeannes adds.
Junior mining companies, many of which typically find new gold deposits through exploration drilling and therefore lack a source of revenue from the very commodities for which they seek, have become hard-pressed to raise funds on global stock exchanges. That’s freed up demand for drilling equipment, rigs and men.
Goldcorp plans on spending more than $230 million on exploration in 2013, but less than 10 percent of that total will be spent in Nevada.
“I am a bit biased, but I still think Nevada is a great place to do business,” Jeannes says. “I think it is perceived that way from outsiders. With all its attributes workforce, stable legal environment and tax regime, a supportive government it is a good place to do business. That doesn’t mean it’s easy; it takes longer to get something permitted here than in most places, including Canada, but when you look at all the attributes together Nevada is a place most of us want to be.”
A global survey of mining executives confirms that fact.
The Fraser Institute’s 2011/2012 Survey of Mining Companies ranks Nevada eight among the major mining jurisdictions in the world.
However, Nevada ranked second in the Fraser Institute’s 2010/2011 survey. More than half the survey respondents felt gold currently just under $1,700 an ounce will increase in price by 20 to 50 percent through 2013.
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