Guyana Goldfields significantly scales down operations - but holds on to claim with hope of recovery

Guyana Goldfields significantly scales down operations – but holds on to claim with hope of recovery

Jan 30, 2019 News

The Guyana Goldfields is continuously scaling down its operations across interior locations in Guyana. However, this newspaper understands that while it is steadily aborting locations, the company is holding on to claims.
Since August last year, Guyana Goldfields laid off more than 80 workers at its Aurora Gold Mine operations in western Guyana, after the company decided to focus on existing gold-bearing properties instead of searching for new deposits.
Country Manager Violet Smith was quoted in sections of online media saying that the decision was aimed at cutting the company’s operational costs.
Six months later, Guyana Goldfields is not looking to return to the location anytime soon. This has been confirmed by officials from both the Ministry of Natural Resources and the Guyana Geology and Mines Commission (GGMC).
Sources say that the company is “taking a hit,” but is not looking to give up the claims, since it is “hoping to make a recovery soon.”
Kaieteur News understands that the government has no grounds to take back the claims at this point, but notes “other companies are interested.”
The move to lay off workers last year came one month after Goldfields’ founder and Chief Executive Officer, Patrick Sheridan’s services was terminated. He has since been appointed an ordinary director. Sheridan was responsible for exploration.
Goldfields said that it moved away from there after Sheridan left because the locations—Wynamu and Sulphur Rose—had shown “small signs of gold.”
Yesterday, one source said, “it is strange though, because companies usually relinquish areas that do not seem to have much gold.” The source continued, “but I guess the company is really banking on making a comeback and will return then.”
70 PERCENT DROP
According to the Toronto Stock Exchange, the share price for Guyana Goldfields Inc. has tumbled by 70 percent. It is now trading at CDN$1.66.
Sheridan now worries that the drastic fall in share price may make the company an easy target for “takeover”.
He also expressed concern that in November 2018, the company’s stock fell by 47 percent. He said that this was due to the fact that the board revised the expected gold production from the Aurora mine down to 155,000 ounces — its second downward revision in 2018 from an original estimate of as much as 210,000. Sheridan said that clear reasons were not released to justify the revision.
Sheridan recalled that the board went ahead without the approval of the environmental authorities and started blasting an underground expansion of the mine, only to stop work 10 days later after receiving a cease order.
Sheridan, along with other shareholders, moved for the current board of the company to be replaced due to the loss of over US$700M in shareholder value, which was accumulating since 2016. He and the concerned shareholders, who together have a 5.4 percent stake in the company, also called on the Toronto Stock Exchange to monitor any transactions that would be made by the company until the board has been replaced.

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