Production of bauxite is rising fast, and promising exploration findings may result in new gold mines

MINING is one of the most important sectors of Guyana’s economy, accounting for around 40 percent of the country’s exports. The Guyana Geology and Mines Commission (GGMC) reports a significant increase in bauxite and diamond production during the first quarter of this year. And while gold statistics were down, along with the closure of the Omai gold mine last year, there are high hopes that a new wave of exploration will reveal important new deposits.

Revitalization of the bauxite industry is well under way following privatization of state-owned operations in northeast Guyana, where reserves stand at approximately 700 million tons. Overall production is expected to rise by 78 percent as a result of major investment by two foreign private companies—Canada’s Cambior and Russian aluminum producer Rusal.

Although the Omai mine closed last September, the increase in world gold prices has spurred exploration activity. Three Canadian companies are exploring large areas in the western and northwestern regions. Guyana Goldfields of Ontario and Vancouver-based Sacre-Coeur Minerals and Strata Gold are expected to invest a total of US$20 million dollars. Initial results are positive, and production could start on three new mines within two to three years. According to GGMC Commissioner Robeson Benn, conservative estimates show that each of the mines could produce a minimum of one million ounces of gold. Guyana Goldfields has recently reported finding “significant gold values” on the Cuyuni River at Aurora.

Operating highly profitably with no immediate prospect of privatization is the state-owned Guyana Oil Company (Guyoil), which has grown from a million- to billion-Guyanese-dollar business.

According to Oscar Phillips, Guyoil’s Deputy Chairman, the key to the company’s success is effective management. Although it is state-owned, it is run like a private company. No government revenues are used to subsidize its operations, so its service stations must operate as profit-making centers. Mr. Phillips says, “The quality of the service at any of our service stations could match that of any of the service stations within the private sector, and the company is consistently upgrading its standards.”