Govt. concerned about low gold recovery rate

Jun 24, 2024 News

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– challenges miners to adapt to new technologies

Kaieteur News – With modernisation taking place in each sector, miners are encouraged to adapt to the new technologies to help increase the country’s gold recovery rate.

This was emphasised by Minister of Natural Resources, Vickram Bharrat during a recent meeting at Duke Lodge with persons within the gold trade industry. According to the minister, the country’s recovery rate is relatively low. He said it is important for miners to shift the way in which they are currently doing things. “We only recover about 35 or 40 percent of the gold at any given mining area, whether at a small or medium mining operation. So, we have to get our miners to adapt to the new technology and different methods of doing things,” the minister stressed.

With the use of technology, the recovery rate can greatly increase or even double the percentage of what the country is currently reaping. The minister that once the rate is doubled then it simply means that there will also be an increase in gold production at a similar cost of operation. However, this can only be done once the miners reinvest in their mining operations and make use of the technology that is being made available to them, especially from the government.

Additionally, the natural resources minister added that they are now looking to adamantly use mercury within the gold mining industry. “We are looking to phase out mercury. We are a signatory to the Minamata Convention, so we will phase that out. It simply means that they will have to adapt to the new technologies, whether by themselves or working in groups,” Minister Bharrat stated. Miners usually mix the liquid mercury into the sediment which then forms a coating around the gold.

Even as government grapples with low recovery, the country’s gold declarations have dropped by approximately 209,000 troy ounces over the past five years. Vice President Bharrat Jagdeo previously had expressed the Government of Guyana’s concern about this trend. He warned that strict penalties would be imposed on those found guilty of under-reporting gold declarations to evade taxes and royalties. In 2019, gold declarations were 641,828 troy ounces, marking a 4.7% increase that year, primarily due to greater declarations from small and medium-scale miners. However, foreign companies, Guyana Goldfields Inc. (Aurora Gold Mines) and Troy Resources Guyana Inc., saw a combined output decline of 26.6% to 186,584 troy ounces.

Jagdeo explained that higher gold declarations in previous years were due to large-scale miners beginning production, leading to increased declarations from those companies. Kaieteur News had reported that Troy Resources exited Guyana’s gold industry owing the country over $2.6 billion in royalties.  Last year, total gold declarations contracted by 11.2 % to 432,113.2 troy ounces, reflecting a decline in production by small- and medium-scale miners and an increase in the sole operating foreign company. It was stated that AGM recorded higher declarations by 7.8% to 109,358.4 troy ounces at the end of 2023.

In wake of the US sanctions on the Guyanese billionaire Nazar Mohamed, his son Azruddin Mohamed and government official Mae Thomas for alleged gold smuggling and corruption, the government last week said it was now requesting information on all local gold exporters to see if they have been making accurate gold declarations.  President Mohamed Irfaan Ali during an engagement with the media at State House on Thursday said that while it is awaiting information from the United States on the Mohameds, the government is also seeking additional information on all gold exporters. “I have asked the Guyana Revenue Authority (GRA) to seek further information at all export locations on gold exported by other gold dealers so that we can have information to see if it matches what is declared in our system”, the president said before revealing saying that GRA is managing the process and is very proactive in its approach for the information.

The sanctions imposed on the Mohameds were made by the US Treasury’s Office of Foreign Assets Control (OFAC).  The OFAC made allegations against the Mohameds for a series of corruption – including gold smuggling. It is alleged that Thomas, the Permanent Secretary (PS) for the Ministry of Labour, misused her position to offer benefits, like government contracts to the Mohameds. On the sideline of an event at the U.S. Embassy in Georgetown, Ambassador Theriot said the sanctions, are the result of over two and a half years of investigations by US authorities.

Ambassador Theriot highlighted the gravity of the offenses that led to these sanctions. She stated, “We reserve these types of sanctions for gross levels of corruption and human rights abuses.” Theriot went on to explain that, “it’s a very high bar, we do not do this lightly. This is something that we ensure that we have a preponderance of evidence before we’re ready to levy the sanctions and we had that in this case against the three individuals who were sanctioned.”

Senior Minister with responsibility for Finance, Dr. Ashni Singh and Commissioner General of the Guyana Revenue Authority (GRA), Godfrey Statia have since written to the OFAC requesting additional information on the allegations. President Ali on Thursday said that his government is still awaiting that information but have since revoked their cambio licence. The government has even moved to meet with local jewelers and local gold dealers asking to keep record of those who sell them gold.

 

 

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• Azruddin Mohamed, Dr. Ashni Singh, Minister of Natural Resources, Vice President Bharrat Jagdeo, Vickram Bharrat

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