Omai new gold find two times Guyana’s US$3.2B debt

Oct 24, 2022 News

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– Govt. still to keep promise of releasing mining contracts

By Shervin Belgrave 

Kaieteur News – Canadian Gold Company, Omai, most recent gold find in Guyana, is worth two times this country’s US$3.2B national debt.

The company according to a statement released on Thursday last, informed their shareholders that within nine months, it has been able to increase its mineral resource in Guyana from 1.6 million ounces of gold to some 3.69 million ounces of gold (total includes both indicated and inferred estimates).

Omai’s President and Chief Executive Officer, Elaine Ellingham said, “We are extremely pleased with the results of this 2022 updated Mineral Resource Estimate (MRE)”.

The company has all the reasons to be ‘extremely pleased’ because at the current world market price for gold, 3.69 million ounces is worth more than US$6.2B and if the price continues to rise, the value increases.

This massive increase stated Omai, was achieved by being able to exceed it exploration goal before the end of 2022 by expanding its Wenot Gold Deposit and bringing in its new Gilt Creek Deposit into the company’s MRE.

Kaieteur News had reported in January 2022 that the company had struck the jackpot only in its Wenot Gold deposit. It had found the 1.6 million ounces gold some 400 metres south of the Fennell open pit- a pit that has produced some 2.4 million ounces of gold for Omai in the past and it was located at a depth suitable for open pit mining.

Nine months later, Omai was able to increase its gold resource in the Wenot Deposit from the 1.6 million ounces to 1.86 million ounces-a 16 percent increase.

However, the biggest increase that more than doubled its gold resource in Guyana came from its new jackpot find in the Gilt Creek Deposit. According to Omai, it has discovered some 1.82 million ounces of gold on the new Gilt Creek Deposit. This find along with the 16 percent increase in the Wenot Deposit, has doubled the company’s gold resource by more than a 130 percent.

The lucrative Gilt Creek gold deposit is located some 500 metres north of the Wenot deposit and below the Fennell pit. In order to extract the millions of ounces gold from the Gilt Creek Deposit, Omai stated that it will take an underground mining approach because of how deep it was found.

Meanwhile, as Omai is ‘extremely pleased’ with its more than US$6.2B gold find in Guyana, the country’s debt (Public and External) as of July, 2022 stands at US$3.2B (likely to increase by year end) and the Government is yet to deliver on its promise of releasing all mining contracts to the public.  If the mining contracts are released, including the one that Guyana has with Omai, citizens will be able to know how much Guyana is earning from all US billion dollar gold finds in Guyana.

Kaieteur News (KN) Publisher Glenn Lall, and his Reporters, has been repeatedly bombarding the Vice-President Bharrat Jagdeo at his Press Conferences to have all mining contracts released.

Jagdeo had promised that he will ensure that the contracts be released since he had said it’s his personal view, that such documents should be public.

Months and weeks passed and during a recent Kaieteur Radio hosted by Lall, Jagdeo was once reminded about the promise he had made. His response was, “I am not your post boy” and told the KN Publisher that he must write the relevant authorities such as the Guyana Geology and Mines Commission (GGMC) and the Ministry of Natural of Resources for the contracts.

Lall, however, had expressed that he had asked the Authorities, via messages and letters for contract on many occasions but they have not released any. The Vice President promised again that he would find what is going on, because he believes the contracts should be made public and get back to Lall.

A month has passed already and the Kaieteur News and its Publisher are yet to receive a feedback from Jagdeo about the contracts.

While the country waits, Omai Gold Mines Corp will continue to explore for more gold on its Guyana concession which spans 4,590 acres land in the Cuyuni/Mazaruni district, Region Seven.

This is not first time the company has been mining Guyana. It had mined some 3.7 million ounces of gold between 1993 and 2005 and had reportedly seized operations because the price of gold had dropped to less than US$400 per an ounce.

Though its return to Guyana was met with high praise by some with the prospect of huge investments and job creation for Guyanese, Omai over two decades had been accused of exploiting Guyana’s resources and causing considerable damage to the environment.

On August 19, 1995 a man-made environmental disaster occurred in the Omai Mines resulting in the wall of an earthen tailings pond which was constructed to contain cyanide utilized in the gold mining industry, being  breached.

As a result more than 400 million gallons of cyanide-laced material had spilled into the Omai River and subsequently into the Essequibo River, the country’s largest river.The spill resulted in severe environmental, ecological, social, economic and political consequences.

In 1993 the company had commenced actual extraction of gold, and during its 24-year run, the company extracted some 3.7 million ounces of gold but only paid five percent of that in royalties to Guyana.

Had the terms of its contract for the lucrative gold mine entailed more benefits for Guyana, the country would have reaped billions of US dollars. To make matters worse, the company also benefitted from a number of tax, fuel, and vehicular concessions—totaling millions of Guyanese dollars.

Guyanese are yet to see the new deal the country has with the gold company since its return a few years ago.

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