Race on to meet targeted 311,000 ounces

December 29, 2010 | By | Filed Under News 

Rains affect gold production…


By Leonard Gildarie

A severe dry spell followed by heavy rains during the midyear period has affected gold production, with the targeted 311,000 ounces still 17,000 away, and only two days remaining in the year.
As of yesterday, gold prices were hovering around US$1,405 (G$281,000) on the world market, as prices continue to climb.
According to President (ag), Charles DaSilva, of the Guyana Gold and Diamond Miners Association (GGDMA), as of Monday, declarations to the Guyana Gold Board were hovering around 294,000 ounces.
“The association is confident that Guyana will meet the target,” DaSilva said yesterday.
It is believed that miners were holding on to their takings waiting for the prices to climb.
With prices on the world market surging from US$1,397 on December 8th to US$1,404 and then stabilizing since then, both GGDMA and the Guyana Gold Board have reasons to be confident.
“We have been encouraging our members to make their declarations early to the Gold Board and yes, it looks good.”
The Guyana Gold Board is reportedly expecting significant declarations from some medium-scale producers and this may also nudge the figures even further, Kaieteur News was told yesterday.
It was, from all indications, not an easy time for miners this year.
Heavy rains in the May/June period saw work opportunities reduced drastically by up to 15%.
“We had fuel and other supplies going in. You also had problems with access to mining areas with roads in a bad way and then sections of the pits flooded out for some time. So we had disruptions.”
Last year was a good year for gold mining with production reaching 300,000 ounces for the first time in the absence of Omai Gold Mines, a large scale producer which closed its operations a few years ago.
As of November 30, declarations were at 266,351 ounces, according to figures of the Guyana Gold Board. This would have meant that more than 27,000 ounces were declared for the last three weeks.
Gold production showed an increase of 8.1 percent at the half year.
The price factor was the catalyst driving increased production in the first half, according to the Financial Mid Year Report tabled in October in the National Assembly by Finance Minister, Dr Ashni Singh.
At the end of last June, the monthly average price of gold on the international market showed an 8.7 percent increase over the December 2009 monthly average. June 2010 recorded the highest ever monthly average price of US$1,233 per ounce with projections then showing that price was expected to remain above US$1,000 per ounce for the remainder of the year.
The surge in gold production came at the expense of diamond production, however. The half-yearly report stated that the catalyst of the prevailing gold price has resulted in a physical migration of mining activities out of diamonds into gold with the resultant 59.5 percent decline in declaration at the half-year.
The comparative decline in diamond production relative to gold continued throughout the year to the extent that ‘other mining activities’, of which diamond production is the major component, projected at budget to grow by 3.6 percent, were revised to record a decline of 22 percent for the year.
When the price of gold reached US$1,300 an ounce in September last month, GGDMA had called on miners throughout Guyana to increase their declarations and production.
Executive Director of the GGDMA, Edward Shields, had said that he hoped that miners would take full advantage of the high price of gold and capitalize on it. He noted that this is an opportune time for profit and it would also allow for the country to get more value for the production.
The association had stressed that it wanted to see declarations increase; noting that for every 1,000 ounces sold the government earns almost $17 million in royalties and taxes.
The GGDMA had set an ambitious gold production target of over 400,000 ounces for 2010.

Authorities are hoping high prices will encourage last-minute declarations

GGDMA President (ag), Charles DaSilva.

If you find a comment distasteful or inappropriate, you can flag the comment and send us a report for immediate removal. Send report to kaieteurnews@yahoo.com
Kaieteur News reserves the rights to moderate any comment deemed inappropriate and is not responsible for the views expressed.

blog comments powered by Disqus

Updated by Kaieteur News Personnel. All Rights Reserved. A GxMedia website solution.