–seeks to raise CAN$4.5M for operations through sale of common shares
EVEN as the company plans to expand its capital base, Omai Gold Mines Limited (OGML) has announced that it will soon be exploring the “historic resource” beneath the once-producing Fennell deposit.
The company’s Chief Executive Officer (CEO), Elaine Ellingham, was quoted in a recent statement as saying: “We plan to initiate drilling in 2022 to both verify and explore the expansion potential of the historic resource beneath the past-producing Fennell deposit.”
After ceasing operations here years ago, the company has made a return to Guyana, specifically to its worksite in the Cuyuni-Mazaruni region, where it intends to make an initial investment of US$12 million.
It was reported that the company had wrapped up operations in 2015 after 24 years of service in Guyana. Omai, during its “glory days”, was listed as being one of the largest gold mines in Guyana and the world, with estimated reserves of 3.7 million ounces of gold.
Since its return to Guyana, the company has discovered large deposits of high-grade minerals during ongoing geological surveys at the Wenot Pit.
The assay results from the first two holes at the pit, 12WED11 and 12WED13, which were never logged or sampled, indicate that high-grade mineralisation extends below the Wenot Pit, and there is expansion potential of gold mineralisation to new sedimentary targets.
Former CEO of Omai, Mario Stifano had said: “We are very pleased that the results from these two holes confirm that high-grade gold continues beyond the limits of the Wenot shear, and the Wenot Pit to the south within the sedimentary package, and that mineralisation from the Wenot Pit continues at least 150 meters below the depth of the historical pit that was mined. These results support our planned initial 5,000-meter drill programme, beginning in the new year.”
In a more recent update, Ellingham said: “Our recently completed drilling (10,000 meters), mostly focused on Wenot, confirmed that the gold-mineralised Wenot shear corridor continues to a considerable depth below the past-producing pit, along the full 1.7 km strike.
“With the independent Qualified Person (“QP”) preparing our initial NI 43-101 report on this Wenot deposit, we have commenced our next phase of exploration.”
According to the CEO, drilling restarted last week, with a new focus on the strike extension of the Wenot pit, both east and west, as well as some initial scout holes on the large Broccoli Hill target, and other unmined areas with potential for near- surface gold deposits amenable to open-pit mining.
To further fund this and other operations, the company has announced a non-brokered private placement offering for aggregate gross proceeds of up to CAN$4.5 million, through the issuance of units of the company at a price of CAN$0.11 per unit.
Each unit will consist of one common share, and one-half of a common share purchase warrant.
“Two such half warrants constitute a full warrant. Each warrant entitles the holder to acquire one common share at an exercise price of CAN$0.20 for a period of 24 months from the closing date of the Offering,” the company explained.
The net proceeds from the sale of units will be used for exploration and drilling at the Omai project, and for working capital and general corporate purposes.
The company, on its website, said Guyana has a long history of resource investment, but recently there has been a resurgence of interest in the country from large international firms. Currently, there are over 25 mining companies active in Guyana as well as large-scale oil producers like ExxonMobil, which are investing heavily in Guyana’s infrastructure and workforce.
This “economic renaissance,” as described by Omai, has led the International Monetary Fund (IMF) to rate Guyana as the fastest growing economy in the world, and determine that the country’s Gross Domestic Product (GDP) of US$3.5 billion is expected to triple within the next five years.
The country’s potential is undoubtedly one of the reasons for the company’s return, and just October 1, 2020, Omai announced that it has completed its previously announced reverse takeover transaction in which Omai acquired all of the issued and outstanding common shares of Avalon Investment Holdings Inc. (“AIHL”), a private Barbados corporation.
The company’s short-term priorities are to verify and expand the known resources, while advancing exploration on key targets, providing a solid opportunity to create significant value for all stakeholders.
It was reported that the company will not only be engaging and potentially supporting small miners, it will also hire hundreds of people, as over 1,000 persons were employed during the company’s early days of operations in Guyana.