– below projected first-quarter target

GOLD production has fallen to 288,114 troy ounces, 19.4 per cent below the original projection and 9.1 per cent below the level achieved at the end of June 2017.
The shortfall is credited to the declaration of small and medium-scale miners whose production fell to its lowest first-half level since 2010.

“This was largely attributed to higher operational costs stemming from higher fuel prices, and the deterioration of hinterland roads,” said the government in its mid-year report.
According to the report, together, those factors served to dampen the expected positive response of small and medium-scale miners. There were also concerns about the smuggling of gold produced in Guyana, to neighbouring jurisdictions where more favourable fiscal terms prevail.

Another was the inability of Guyana Geology and Mines Commission (GGMC) officials to conduct regular site visits to verify the production numbers of small and medium-scale miners due to a strike action during the second quarter of the year.

Although the small and medium-scale miners under-produced, two large mining companies, namely Troy Resources and Aurora Gold Mines (AGM), declared a total of 128,175 troy ounces or 44.5 per cent of overall declarations. This was their highest combined level since operations began.

The increase was driven primarily by Troy Resources Limited, which experienced stable mining and processing conditions, resulting in the accumulation of an ore stockpile which can be processed during the two month wet season.

The revised outlook for the gold industry for 2018 anticipates a contraction of 14.1 per cent compared to the 3.3 per cent growth originally projected, stated the report.

There was also a decline in export earnings from gold, due mainly to lower export volumes, which decreased by 12.8 per cent, to 282,615 troy ounces.

“This unfavourable outturn was largely due to challenges faced, by the Guyana Gold Board (GGB), with respect to gold smelting and the attainment of a cost-efficient quantity of gold for export,” the report stated.

On a more positive note, the international price of gold has increased by 9 per cent to US$1,329 per troy ounce in the first quarter of 2018, when compared to the first quarter of 2017, on the basis of strong investment demand amid rising inflation and a weakening dollar.

In addition, gold prices are expected to increase by 3.3 per cent above the 2017 price to US$1,300 per troy ounce.