With the local gold industry already having predicted that production is likely to top 300,000 ounces for the third time in successive years, miners are anticipating another good year in the face of successive forecasts of continued price rises through 2011 and up to the end of next year.
Earlier this month, the Japanese financial company Nomura Group with metals and other subsidiaries projected that gold prices could rise by more than 10 per cent to US$2,000 by the end of 2012. The projection, made earlier this month is based on low interest rates in the United States and the easing of monetary policy by the European Central Bank.
Earlier this year the Guyana Gold and Diamond Miners Association (GGDMA) said it expected gold prices would continue to rise through 2011 and the price levels offered every incentive for miners to increase gold yield this year. The association also noted at the time that changing trends in the local gold-mining industry had witnessed an interest in investment by local businesses that had had no previous business interest in the sector. Some entities have developed relationships with the industry arising out of their marketing of mining equipment. Reports out of Europe indicate that gold prices edged higher this month as a result of a weaker dollar while market responses to bankruptcy in Greece did not appear to be affecting gold prices.
With no let up seen in the international financial markets in the immediate future, small gold-producing countries like Guyana stand to benefit from the protracted windfall though metals experts say that there is now every incentive for modest producers to make meaningful short to medium-term investments in maximizing their production.
Last month gold prices reached a record high of US$1,814.90 an ounce and European investment company, Aberdeen Asset Management, also projects that gold prices could reach at least US$2,000 per ounce by the end of next year.
Other projections regarding where the price could go over approximately the next 12 months are even more interesting. Chairman of US Gold Corporation, Robert Mc Ewan, believes that prices could rise to the level of around $5,000 per ounce by 2012.
Guyana’s gold industry faces official pressures to ensure that the gold is exploited in an environmentally sustainable manner. An allied consideration is the ban by Europe and the United States on the sale of mercury which is used extensively as an alloy in the local industry and the international pressures for the banning of the use of mercury. While there has as yet been no official pressure on the mercury question local organizations including the Guyana office of the World Wildlife Fund (WWF) have been generating studies on alternative mining methods that exclude mercury application.
