Guyana Goldfields Inc (GGI) on Wednesday announced that it had processed the last batch of ore from its stockpile at the Aurora gold mine in Cuyuni/Mazaruni and will continue to recover gold in circuit inventory over the next several days.
Thereafter, as previously announced, it said that the mine site will go into a period of care and maintenance.
GGI, a Canadian company, is in transition from open pit mining to underground mining and is also in the midst of a takeover by a Chinese company.
A GGI release said that gold production for the second quarter totaled 28,500 ounces, bringing total gold production for the first half of the year to 56,600 ounces. This, it said, is above its guidance of 45,000 to 50,000 ounces for the first half of 2020 as disclosed on May 28, 2020. In 2019, second quarter gold production totaled 37,300 ounces and 74,000 ounces of gold was produced in the first half.
GGI added that its unaudited cash balance as at June 30, 2020 was US$28.8 million (inclusive of US$10 million restricted cash) with US$6.5 million in debt.
It said that as part of the transaction announced with Zijin Mining Group Co., Ltd, the Chinese company that will be taking it over, a US$30 million secured loan facility was provided to the company by Zijin. The loan balance of US$6.5 million is as a result of the first advance under the Zijin Facility, following GGI’s payment to Silvercorp Metals Inc of the C$9.0 termination fee on June 11, 2020 to terminate the Company’s previous arrangement agreement with Silvercorp. Canadian silver miner Silvercorp had also been trying to take over GGI.
As previously announced, on June 12, 2020, the Company entered into an agreement with Zijin pursuant to which Zijin has agreed to acquire, through a wholly-owned subsidiary, all of the issued and outstanding shares of the Company not already owned by it. The management information circular and related materials in connection with the upcoming annual general and special meeting of shareholders at which, among other matters, the Zijin arrangement will be voted on by shareholders, were mailed last week to shareholders of the Company of record as of June 23, 2020. The board of directors of the Company has unanimously recommended that Company shareholders vote for the special resolutions approving the Zijin arrangement and the special resolution approving the reduction in the stated capital of the Company shares in order to satisfy certain requirements under the Canada Business Corporations Act in respect of the Zijin arrangement.
Any questions regarding the Meeting can be directed to its strategic shareholder advisor and proxy solicitation agent Kingsdale Advisors at 1-800-775-1986, or by collect call outside North America at 416-867-2272, or by e-mail at contactus@kingsdaleadvisors.com
GGI has experienced a series of challenges in recent years including a collapsing share price and a battle for control of the company.
