Minister with responsibility for Natural Resources, Raphael Trotman and Minister of Public Infra-structure David Patterson on Tuesday visited Sand-spring Resources Limited’s proposed mine at Toroparu, Region Seven and pronounced themselves pleased with the company.
Earlier this year, the Canadian mining company announced that it had put off completing a feasibility study for its proposed large-scale gold mine at Toroparu, Upper Puruni River as a result of uncertainty in the gold market. The company’s Toroparu Gold Project in Region Seven was one of three large-scale mines including Troy Resources Limited and Guyana Goldfields who were set to open mines and begin gold production this year. Troy Resources and Guyana Goldfields have moved ahead with their plans and have begun production while Sandspring cited the uncertainty in the gold market and challenges in raising capital for the deferral of its feasibility study.
In a statement in February, the company had said that it is undertaking a series of steps to enhance its ability to move forward while responding to the extended period of volatility and uncertainty in the gold market and the challenges in raising equity capital that continue to face junior developers.
Recently the company announced that it had commenced a new exploration programme at Toroparu. “Although market conditions remain challenging, Sandspring has been re-energized following the acquisition of PNO Resources, with a stronger balance sheet and additional expertise at both the management and Board level,” Rich Munson, CEO and a director of Sand-spring said in the statement last month. “Sandspring’s team is focused on adding shareholder value by prudently managing the company’s treasury and continuing to advance the Toroparu project with modest drilling and exploration programmes,” he said.
Yesterday, a statement from the Ministry of the Presidency said that the visit to Toroparu was intended to give Trotman an overview of the company’s operations and to enlighten Patterson on the hydropower project being undertaken by the company to support the running its day to day activities.
The Toroparu Project, which is still in its exploration stages, is expected to be larger than the Guyana Goldfields/Aurora Gold Mines Project and Troy Resources, Karouni Gold Project. As such, Trotman noted that the visit was a necessity, the statement said.
Beneficially occupied
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Our job is to facilitate investments into the industry and the country and to ensure that the Essequibo is beneficially occupied and the resource base is explored and developed. I am equally excited about the prospect of the hydro project that would accelerate development in the Region and even be able to provide energy to the grid,” Trotman was quoted as saying after the visit.
In April 2013, government and CM Power Company, a subsidiary of Sandspring Resources/ ETK Inc, inked a MOU for a feasibility study for construction of a hydropower plant at the Kumarau Falls on the Kurupung River. According to the statement, located approximately 50 km southwest of Toroparu, it is estimated that the hydropower project can support more than 100 megawatts of run-of-river hydroelectric capacity. An initial 50-megawatt run-of-river facility would support the Toroparu Project and other enterprises located within 120 km of the power plant. Sandspring estimates that the use of hydroelectric power could reduce its cash operating costs by US$60 to US$80 per ounce of gold produced. Such a reduction would not only result in significant cost savings over the life of the Toroparu Project, but also increase the economic viability of mining additional resources not currently in its mine plan, the statement said.
Given government’s new push for a green economy, Patterson expressed interest in the venture. In the meantime, however, the visit also provided the opportunity for him to determine the transport needs in the area.
“I am looking at two things here in this Region; the roads and bridges, which come under my Ministry and the possibility of hydropower here. My visit, however, was primarily to check on the roads. This company maintained it in the past but they have indicated that they cannot continue to do so, and so we are looking at the various options available to maintain the road because lots of miners use it but the hydropower plan is very economical and very interesting,” Patterson was quoted as saying.
After a brief presentation on the operations of the company, the Ministers and team, which included Sir Shridath Ramphal, Permanent Secretary, Department of Natural Resources and the Environment Joslyn McKenzie, Ministerial Advisors Clayton Hall and Kenneth Jordan, and President of the Guyana Manufacturing and Services Association Norman McLean, were given a tour of the current operations.
Chief Executive Officer of ETK Inc/Sandspring Resources Ltd Rich Munson, who accompanied the team to the camp, pledged his commitment to working with the government as he expressed optimism and confidence in having a successful venture in Guyana despite falling gold prices, the statement said.
The company had previously said that it wants to produce 228,000 ounces of gold per annum from its proposed Toroparu Gold Project.
