Oct 16, 2010 News
Gold production showed an increase of 8.1 percent at the half year and the budget projection of four percent increase for the whole year is maintained.
The price factor was the catalyst driving increased production in the first half according to the Financial Mid Year Report tabled 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 showing that price is expected to remain above US$1,000 per ounce for the remainder of the year.
The price for gold yesterday was US$1,380 per ounce. 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 is expected to continue 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 is now revised to record a decline of 22 percent for the year.
When gold price reached the US$1,300 an ounce mark last month, the Guyana Gold and Diamond Miners Association (GGDMA) called on miners throughout Guyana to increase their gold declarations and production.
Executive Director of the GGDMA, Edward Shields, said that he hopes that miners will take full advantage of the current high price of gold and capitalise on it by selling more of their gold and increasing their production.
He noted that this is an opportune time for profit and it will also allow for Guyana to get more value for the production.
The Association says that it wants to see declarations increase; noting that for every 1,000 ounces sold the government earns almost $17 million in royalties and taxes.
The high prices now mean that the government will collect even more benefits from the mineral resources of the country.
The executive director explained that miners have to demonstrate to the government that they are willing to go the extra mile to ensure that Guyana can maximise its benefits from gold mining.
Gold won in the interior of Guyana has to be sold to the Guyana Gold Board or to licensed dealers in order for the royalties and taxes to be calculated and paid.
The GGDMA noted that it is through the payment of these dues that national development can continue to progress.
According to the Association, it wants miners to recognise that the selling of their gold from the mining operation is an overt demonstration of the contribution of mining to the development of the national economy.
The GGDMA has set an ambitious gold production target of over 400,000 ounces of gold for 2010.
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