Guyana Goldfields Pours its first dore bar!

AUGUST 5, 2015 | BY KNEWS | FILED UNDER NEWS
Guyana’s first large-scale gold mine since the departure of Omai Gold Mines Limited, a few years ago, says it has made significant headway into full operations, pouring its first bar recently.
According to Canadian-owned, Guyana Goldfields Inc. (GGI), its first gold production has been achieved on-time and on-budget at its Aurora Gold Mine in Region Seven.
“First gold production was attained through the gravity and saprolite production circuits which allowed for earlier gold production (pre-commercial production) through the processing plant. Initial start-up gold was captured by processing the lowest grade ore available and GGI is now progressing towards full saprolite circuit operation and will gradually feed the mill with higher grade material. The commissioning and startup of the hard rock crushing circuit is projected to be completed later in the third calendar quarter of 2015,” the company said in a statement yesterday.
GGI expects to produce between 30,000 ounces to 50,000 ounces of gold in 2015, depending on how quickly full ramp-up is achieved, and approximately 120,000 ounces to 140,000 ounces of gold in 2016.
goldmine
The Aurora gold mine site in Region Seven.
The company’s announcements come as gold declarations fell 20 percent for the first half as compared to the corresponding period last year,
GGI said it will issue a feasibility study in the first quarter of 2016 for the project which will reflect an extended open pit mining scenario while deferring the underground production until later in the mine life, as well as current operating cost parameters, and an updated ore reserve metal price.
With many companies careful with their investments in the gold sector, GGI said it is sufficiently funded to complete construction of the Aurora gold mine.
As of June 30, 2015, the company had approximately US$20M of capital expenditures remaining to complete the Aurora mine.
“The company is managing its overall development budget to not exceed US$277M which includes the initial development costs of US$249M for the project and US$28M in financing costs, pre-operating costs and working capital investment. The project remains to be tracking on budget with an untouched US$52M overrun facility available, if needed.”
Scott Caldwell, President and CEO, commented: “Our first gold pour is an extraordinary achievement in GGI’s transition from an exploration and development company to a high grade, low cost gold producer. We would like to celebrate this significant accomplishment for all that have contributed from the project’s inception and thank our shareholders and stakeholders in supporting the development of the project, including our Board of Directors, management team, employees and contractors as well as the lenders for the debt financing syndicate comprised of International Finance Corporation, Export Development Canada, ING Capital LLC, Caterpillar Financial Services Corporation, and The Bank of Nova Scotia.”
The company also lauded the Government of Guyana and local communities for their support through the development of the project.
“The focus at the site now is to increase gold production to our target level of 50,000 ounces during the balance of this year.”
GGI is a Canadian based company, focused on the exploration and development of gold deposits in Guyana.
The Aurora Gold Project has a total gold resource of 6.54 million ounces in the measured and indicated categories as well as an additional 1.82 million ounces in the inferred category.

GOLD TOO BIG TO FAIL Part Two

The Story within the Story…GOLD TOO BIG TO FAIL: Missing a target but plotting a course

 

So the new year has begun. It brings fresh hope, a time perhaps to revisit the way we have been doing things and improve on them. Life is about mistakes, about not making that perfect decision every step of the way.
It was official on Friday. The gold industry recorded around 97,000 ounces less than the projected declaration that was set at the beginning of 2014. Guyana was again looking for over 480,000 ounces. Less than 390,000 ounces came in.
For hundreds of miners and a similar number of service providers and suppliers, last year was relatively devastating. The drop in gold prices from a high of US$1900 per ounce to US$1200, in a matter of months, could not have come at a worse time. Many of them had invested heavily, buying trucks, equipment like dredges, bulldozers and excavators, and even took loans to build their homes.

A dredge in operation.

When the price came crashing down, many of them were totally unprepared. For some it was the first time in mining. The harsh reality of the downward spiral was a rude awakening. Staffers had to be sent home. Many operations ceased. Suppliers took back their equipment or were forced to suspend payments. It was a dreadful situation as compared to 2012 when the industry was at its zenith and Guyana was glowing from the effects. Gold had become the biggest foreign currency earner.
Recently, I was driving through my street, on the way to work, when I saw the PVC ceiling of a home under construction being ripped apart by high winds. There was a look of frustration on the owner’s face. His contractor had installed the PVC without the necessary straps, and even the gutter boards, in place. So it was obvious that the wind coming in had to go somewhere. It lifted the PVC ceiling, ripping the material from the little that was holding it.
I believe that the man took a mortgage and being ill-informed, and with little advice from his contractor, decided to install that ceiling. It should have been last on the list of things to do. He paid the price.
Similarly, miners, including some of the first-timers, gambled that the price would have held out. It did not. Those who survived are the ones that had deep pockets and large operations feeding off each other. High salaries, costs of services and fuel, were the immediate challenges. The obvious solution was to either cut costs or close operations with the hope that prices rise soon.
There is some good news. The experts are predicting that gold prices may meet US$1400 per ounce this year. However, miners would have to apply their lessons learnt in the past months to keep their heads above water.

Closed operations were a feature during the course of the year.

ANY ANSWERS?
So what are the answers to the industry?
The Ministry of Natural Resources and the Environment, in its recent year-end roundup, said that it has embarked on a number of initiatives to ensure that the industry remains competitive.
Training has been provided through the Guyana Mining School and Training Centre Inc. for in excess of 220 persons. Some of the training includes some of the best practices in recovering gold.
Another area of concern raised by miners regarding the state of roads to the mining camps is also being addressed. Last year, the Guyana Geology and Mines Commission (GGMC) spent in excess of $1.4B on roads and building infrastructure for 2014.
Government has also earmarked a sum of $1B for a revolving fund, towards mercury-free mining development, in another effort to safeguard the environment.
According to the Ministry, the gold trade, covered under the GGMC, must be seen in the context of the international drop in price for the metal. The price fell on average by 22% in 2014. Total declaration at December 20, 2014 showed a decrease by 22.61% over the corresponding period in 2013; and gold-purchased, by the Guyana Gold Board (GGB) fell by 41.24%.  Dealers’ quantity of gold exported increased by 10.16%, whilst the GGB’s quantity of gold exported fell by 40.26%.
“Thus, the overall quantity of gold exported is down by 22.73%. Moreover, the value of gold exported by dealers increased by 10.86%, whilst the revenue garnered by the GGB decreased by 43.48% during the comparative periods. The total revenue for the comparative time period fell by 23.45%.”

Mercury-free mining technology is being pushed by Govt. and the regulators.

It is obvious therefore that “belts will have to be tightened” if prices remain the way that it is now. It will rise again and Guyana will have to capitalize.
On Friday last, the miners’ association, the GGMC, said that miners had done remarkably well in face of the challenges last year. This year, said a heartened GGDMA, large-scale foreign investors, Guyana Goldfields and Troy Resources, are expected to start operations, with production expected to meet 2012 levels by the end of 2015.
But GGDMA opines that the industry can only be saved if a level playing field is allowed. The body wants the same incentives being granted to foreign investors to be extended to the small- and medium-scale miners. While it was not spelled out, the incentives would include tax breaks on earnings, vehicles and equipment, and even on fuel. GGDMA is adamant that the industry should not be disrespected any longer.
Industry experts are calling for a collaborative effort with the stakeholders and miners that could possibly see meaningful measures being implemented. The talks would include a reduction of fuel taxes – a key input in mining operations – among others.
But other analysts are simply warning miners to be cautious in any investments. Any borrowing would have to be realistically matched with the situation on the ground. The mistakes of last year cannot be repeated where the consensus is that operations were allowed to extend too rapidly.
In addition, the US$1200 per ounce mark remains profitable. But costs must be brought down. A long term look at technology that is mercury-free, in keeping with new requirements that will soon have to be enforced, may well be the way to go.
Guyana will have to greatly improve its recovery rates from operations also, improving efficiency as well. At the end of the day, it will mean adjusting operations to meet growing challenges. It will also mean capitalizing on opportunities that most likely will arise.

Troy Resources

Great illustration of Guyana’s terrain and how underexplored Guyana really is. Multi-Million ounce deposits are becoming more common as more and more companies enter into the Guyanese mining industry.

Mining in Guyana

Great introductory to what Guyana’s current mining situation is. Cuyuni Gold plans on using safer methods of separation by use of finishing jigs transferred over to finishing tables to attain the final dore product.