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Canadian gold rush

Dec 11, 2024 Features / Columnists, News

Editorial…

Kaieteur News- The Canadians are well-positioned to enjoy the Guyana dream.  Everywhere they turn, there is gold, so much gold that the amounts written about in official estimates are in the millions of ounces.  Canadian gold investors put in their money and they set themselves up to walk away with a mint.  The question is, what is Guyana getting for giving up all these millions of ounces of gold?

We are sure that jobs for Guyanese would be among the first words coming out of the PPP/C Government leaders, from President Ali to Vice President Jagdeo to Minister Singh.  There is nothing that governing politicians love to speak about more than how many jobs have been created.  For a few hundred jobs, the mineral wealth of this country is given up, while the details about Guyana’s share of its gold bonanza are undisclosed.  There is no talk of percentages, money, returns.  It could be that it is the usual paltry royalty and maybe some taxes, if there was some honest negotiation between the Government and the Canadian companies.  The problem is that nobody is saying much, no disclosures trickling into the public domain.

Guyanese were told a couple of years back that world-class companies will be coming to explore our goldfields.  After that, silence is all that Guyanese have gotten.  Currently, G Mining Ventures (GMIN) and Omai Gold Mines Corp (Omai Gold) are here and the announcements to date from the two companies indicate that both have hit the jackpot, are sitting on the equivalent of rich motherlodes.  GMIN is telling its investors, in the hope of enticing more of them, that their assessments point to five million ounces of gold to come out of Guyana’s gold laden earth in a 16-year timespan.

That is around 350,000 ounces of gold annually for 16 years.  For its part, Omai Gold has been received government approval to explore two fields: the Wenot Deposit and the Gilt Creek Deposit.  The preliminary drilling results have generated much excitement at Omai Gold.  From the Wenot Deposit alone, the early estimates are of 142,000 ounces of gold produced for a period of 13 years.  In one year, production is estimated to climb to 184,000 ounces, and for an overall total of 1.84 million ounces during the 13-year life cycle of the field.

GMIN is anticipating 353,000 ounces in annual production (16 years) and Omai Gold 142,000 ounces yearly for 13 years.  In aggregate that is 495,000 ounces, just under half million ounces annually for the two Canadian gold companies.  Guyana has awarded these huge concessions of its precious mineral rich lands, plus lucrative duty-free provisions and, highly probably, many add-ons that are unknown to those who are the actual owners of this gold, Guyanese.  Aside from visible, low-level jobs to do the heavy work and menial labour, the question continues to stir interest:  what is Guyana getting in return?

The price for gold is over US$2660 per ounce.  With a combined average annual production of both Canadian companies projected to be 495,000 and gold price at US$2660 per ounce, that amounts to US$1,316,700,000 in estimated gold revenues per year.  How many millions are coming from that US$1.3B+ into the Guyana treasury?  We appreciate that gold prices, like those of many other commodities, can be very volatile with heights reached and long declines experienced.  In the 16-year and 13-year production spans of GMIN and Omai Gold respectively, while the two companies are raking in the profits, Guyana should be doing the same.

What is the return in American dollars or royalty percentages or tax rates that Guyana is poised to get?  Would those be at the same pittance levels of the past negotiated under different governments?  The Government of Guyana should be proud to share with its citizens the deals that it signed with these two companies.  The numbers would tell their own story.  When, however, these signed gold contracts have to be kept under lock and key and away from the public, it is a sign that the usual sellout and giveaway have occurred.  Two Canadian gold companies are about to strike it big from Guyana’s gold.  What are the big benefits for Guyana from its mineral riches?

(Canadian gold rush)

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