Guyana Goldfields in big ticket purchases for mine

Canadian gold mining company Guyana Goldfields has begun purchasing equipment for its Aurora gold mine and expects to award construction contracts for several key facilities within the next 30 days.

In a statement yesterday, the company said that it has entered into an agreement to purchase one 5.5 MW SAG mill as its primary grinding solution for the initial milling facility. “The purchase of this key long lead time item is a significant milestone in the development of the Project. The mill is designed for an initial throughput of 5,000 tpd (tonnes per day) expanding to 10,000 tpd in the third year after the commencement of underground production. A ball mill will be added in order to facilitate the expansion and the additional throughput. The purchase price of the SAG mill including motors and spares is approx. US$ 6.3 Million (including freight) and the anticipated delivery time to Guyana is approx. 46 weeks,” the company said.

The statement said that the company has also purchased a fully-equipped and self-contained camp which meets near term requirements for construction. The camp was purchased for approximately US$3 million (including freight) and the anticipated delivery time to Guyana is approximately six weeks. “The company is currently evaluating options for remaining accommodations and recreational facilities required for full construction and will source from local vendors.  Additional equipment and supplies will be required over the course of construction and operation of the Project and the Company is dedicated to purchasing as many items as possible from within Guyana,” the statement said.

It noted that the SAG mill and camp purchase prices and time lines are comparable with estimates reported in its updated Feasibility Study filed on January 29.

“The bulk of the development and construction activities planned for the remainder of the year will be focused on continuing to upgrade the existing access road to the Project site, establishing the off-site Buck hall Port facility, the construction of the first phase of the living accommodations at the Project site, and communications systems for both data and voice,” the company said.

The statement added that Guyana Goldfields also expects to award the full engineering, procurement, construction and management (EPC/EPCM) contract(s) for physical construction of the mill, power plant, river levee, tailings and support facilities for the project within the next 30 days.

Guyana Goldfields has been operating here since 1996. In its updated feasibility study, the company had said that its Aurora Gold project will cost US$205 million to build, less than half an earlier estimate of US$525 million for a mine with a life of 22 years and total production of nearly 4.4 million ounces of gold. The new mine plan calls for production of 3.29 million ounces of gold over an initial 17-year mine life at an operating cost of US$527 an ounce. Average annual gold production over the life of the mine is expected to be 194,000 ounces, averaging 231,000 ounces a year over the first 10 years with production peaking at 349,000 ounces in 2020.

The company had said commercial production is expected to commence in quarter one of 2015.

In its statement, the company said that it has approximately US$112 million in cash and cash equivalent and no debt as of September 12, 2013.

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