The Guyana Revenue Authority (GRA) is preparing to levy on the assets of Australia-headquartered mining company, Troy Resources Guyana Inc for huge taxes owed, even as the company is still to inform government of its exit plans from this country, sources say.
“The GRA is moving to take over now,” Minister of Natural Resources Vickram Bharrat told Stabroek News yesterday.
“They owe taxes and no word has been said on how it will be paid. Government has also not been told as yet of what their plans are but we see them trying to sell assets. If they can’t meet their [contract] obligations, then the state could freeze those assets,” a government source told Stabroek News yesterday while another said that when taxes are owed assets of the company will be seized.
As to the fate of the employees, they too have not been officially notified of Troy’s exit plans and what benefits they might be entitled to, even as many of them are currently owed salaries, sources informed.
“Nothing has changed from yesterday. Australia has to officially give the directive. We are supposed to have a meeting with the administrator to know what the next steps are but that has not yet happened,” one source explained. The company still has not replied to questions from this newspaper. Yesterday, this newspaper reported that the company is closing its gold mining operations in Guyana as it does not find the market feasible anymore, according to sources.
In a notice of liquidation of assets, in Stabroek News’ Thursday edition, the company announced the sale of its assets and sources told this newspaper that “the company has basically shuttered its Guyana operations and is waiting on the administrator to give word of the final day…” Local company representative, Michael Rodrigues, referred all questions to the Australia head office. There was no notice on the company’s website where plans are normally posted. Assets to be sold comprise mining and exploration equipment, shipping containers, catering and accommodation equipment and facilities and office equipment and furniture. At the Karouni site in Region 7, this newspaper understands that there has been daily theft of equipment which resulted from scaled down security and persons in the surrounding areas were aware of this.
Troy Resources had commenced major mining operations in Guyana in 2015 in a blaze of high expectations. It encountered serious difficulties in October, 2019 after geologist, Ryan Taylor, died in a cave that he was working in. The then APNU+AFC government caused the mine to be closed for an investigation and hundreds of workers were laid off. In November of last year, Troy Resources had announced plans to return to gold mining and production at its Smarts Under-ground Site in the fourth quarter of 2023 and had said that it was in the preparatory phase of its resumption timeline. The Australian mining company had also notified that it was revising its business model and was looking at an immediate capital investment of US$10 million for its Karouni operations.
Country Manager, Sven Tegeler, had told this newspaper in an interview in 2022, “We have given ourselves an aggressive timeline for 2023. By this time next year, we anticipate to be back in production. There are a range of defining aspects required to align with this road map, one being underpinned by financial capability and capacity amongst others which we need to set in place to move forward.” Tegeler, who had at the time been in the position for some ten months, had said they were in preparatory mode at different levels across the entire business. On the operations front, a proactive approach had been taken to ensure all equipment and machinery are in working condition and in a state of readiness for operational commencement, he had explained.
He stated that under the leadership of new Operations Manager, Rodrigues, they were working to install high level improvements around the plant and operations. From the corporate side of the business, re-capitalisation had been complete but work was ongoing to acquire other financial instruments. Tegeler said that they were then seeking a capital investment of US$10M. Also, there was a collaborative project with several agencies to return Troy Resources to the Australian Securities Exchange (ASX), Tegeler said. “We are working through any optimization within the plant to be ready for the operations and then financially structuring ourselves to facilitate all this. But like I said, there are phases, and we see this as phase one, to rebuild the company financially so it’s strong enough to move forward into production, and essentially, relist and emerge,” the country manager had detailed.
It had been almost a year since the company voluntarily suspended trading its stock on the ASX and entered into mining care and maintenance. At that time in 2022, Company Secretary, Rebecca Broughton, in a notice to shareholders announced that the company had requested an extension of that suspension. She explained that the voluntary request was necessary for the completion of the company’s re-capitalisation. “Troy anticipates that the voluntary suspension will be lifted on 14 April 2022 or when its full form prospectus is released,” she had stated in a correspondence to shareholders that was seen by Stabroek News. However, by April they were unable to return to the exchange. Troy Resources’ last reported production figure of 2,653 ounces of gold was in February 2021 up from 2,113 ounces in January 2021, putting production for the first two months of the year at 4,766 ounces compared to 4,195 ounces for the last quarter of 2020.
By contrast, and prior to encountering major difficulties, Troy Resources produced 58,118 ounces of gold in 2018 and 70,207 ounces [2017]. As of September that year, Troy had had 450 employees. When mining resumed eventually, the operation was affected by the COVID-19 pandemic. One source told Stabroek News that since the company’s Managing Director, Ken Nilsson passed away in 2021, “the Guyana operations never recovered”.
Sources explained that during this year, there was a “monthly struggle” to pay staff but most stayed on anyway.
