Analysis and News

Gold earnings could top 962M USD this year

BY GEOCAP's Contributor: Navendra Seoraj

Even with increasing attention on Guyana’s oil and gas sector, one of the traditional and key contributors to economic growth, gold, is projected to earn close to 962 million USD by the end of this year.


Gold, which is a significant component of the country’s mining and quarrying sector, has maintained its relevance in the local economy over the years despite various challenges, which, in some cases, have disrupted operations in other sectors.


Its resilience was proven during the height of the debilitating COVID-19 pandemic in 2020, when exports from the gold mining sub-sector were recorded at 599,886 ounces with returns of 979.2 million USD. The sub-sector again, in 2021, recorded positive results, with earnings of 858.4 million USD.


Also, in 2021, as outlined in Budget 2022, the gold mining sub-sector accounted for 8.8 percent of Guyana’s Gross Domestic Product (GDP) and 60 percent of the country’s total non-oil export earnings.


Using basic current prices, local authorities determined that there could be success yet again this year, with export earnings projected to reach approximately 962,500,000 USD.


Further, as reported in Budget 2022, significant growth is expected in the gold mining sub-sector this year, with gold declarations envisaged to continue to be dominated by small and medium scale producers operating 1,054 small-scale mines and 25 medium-scale mines.


New allocations of mineral properties last year saw 202 medium-scale mining blocks being awarded via lottery and 65 via an auction.


Large-scale operators are expected to come fully on stream in the medium term. At Karouni while production will be paused this year, the investor will forge ahead with exploration and development of the underground prospect. 

Beyond this year, according to the national budget, investment in the Toroparu area will finally result in the long-anticipated development of a full-fledged gold mine, since an international mid-tier gold company has confirmed its interest in this project. 


Notably, development works to the tune of 165 million USD are slated for 2022 and a further 189 million USD in 2023, with production expected to commence in 2024.


Additionally, OMAI Gold Mines Corporation has found gold at both its Broccoli Hill and Wenot pits in Region Seven (Cuyuni-Mazaruni).


Broccoli Hill is an area located 300 metres north of the Wenot pit and less than 200 metres east of the Fennell pit. When combined, those pits are expected to produce over 3.7 ounces of gold.


This augurs well for Omai, since the company, after operating in Guyana for 24 years, had closed its doors in 2015.


Upon its recent return, the company had said that its intention is to engage and support small miners, and hire hundreds of people.


The employment of persons and safe development of Guyana’s mining and quarrying sector are aligned with the government’s vision for advancement in this area.


Specifically, as it relates to gold, Senior Minister in the Office of the President with responsibility for Finance, Dr. Ashni Singh, had said: “The vision for gold mining lies with the continued support for exploration to uncover new discoveries that can potentially transition to mining projects. At a strategic level, more focus on deriving efficiency from the mineral recovery phase of the small and medium scale mines can also help to promote sustainability.” 


Owing to the anticipated investments and developments, the gold mining sub-sector could grow by 12.2 percent in 2022. This is specifically on account of higher than normal declarations from one large operator, and the small and medium scale miners.


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