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GGMC systems for allocation of permits not being abused-Mining Association says nation’s first EITI report got it all wrong
The Guyana Gold and Diamond Miners Association (GGDMA) does not agree with the perception made out in Guyana’s first rep
ort to the Extractive Industries Transparency Initiative (EITI) which states that there are abuses of the systems for the allocation of mining permits at the Guyana Geology and Mines Commission (GGMC).
According to the report, there are a number of instances where an operator is able to acquire several medium scale mining permits. But a closer look at the location of the permits revealed that they were granted in the same area and run one after the other.
If they were added, the report states that the plots would have exceeded the 1,200 acre threshold and would therefore be required to be categorized as “large scale tenures.” The report notes that large scale tenures involve paying higher rental fees. Such a licence award also has a different procedure that requires further approvals from other Government Agencies.
By cheating the system, the report notes that the nation is losing significant revenue since the annual rental fees due by large scale operators is US$3 per acre as opposed to US$1 per acre for medium scale mining operators.
But GGDMA is saying that this is not the case. In fact, the Association said that report clearly lacks an understanding of the concepts for land allocation with respect to size of mineral property. It is contending that a summing up of the plots is not enough to classify a property as large scale.
It said that the requirements for a large scale mine are large capital investment such as those made by Omai Gold Mines, Guyana Goldfields Inc. and Troy’s Resources; mineral inventory; Environmental Impact Assessments; feasibility studies; mine plan; mineral processing plant design etc; before reaching the production stage.
The Association said that these up-front expenses run into millions of dollars hence, it is mainly done by large multi-national companies.
For small and medium scale mining, the Association said that this requires some amount of exploration and less detailed environmental assessments. It said, too, that the feasibility is determined by the operator and is not a requirement for permission to work.
Further to this, the Mining Body said that while the maximum size of a medium scale permit is 1200 acres, less than 5 percent is exploited.
GGDMA said, “…The author of the report apparently thought that the entire 1200 acres are mineralized and has gold and as such, by separating the permits the government and people of Guyana are being short-changed. This is far from the case. The large-scale companies receive Investment Development Agreement (IDA) where duty free is granted for equipment, fuel, spares etc. which more than compensate for the extra fees.”
The Association continued, “Medium scale permit holders are paying for most of the land and of which only five per cent is mined. The sector is already in decline, proposing to put such additional burden on the local entrepreneurs that operate with tremendous uncertainties will further impact the communities and villages that depend on it for sustenance.”
It added, “The industry needs more roads to access mining lands, assistance with better techniques for recovery and environmental standards, access to finance and a regulatory system that is more modernized and freer from bottle-necks to ensure that the sector continues to contribute to Guyana’s economy.”
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