Govt hikes processing fee for gold declarations

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All miners, including small and medium scale miners, will now have to pay a hiked processing fee of $2,500 per ounce of gold they declare to the Guyana Gold Board. The fee was previously just $1000 per ounce.

Had the Guyana Gold and Diamond Miners Association (GGDMA) not intervened when a public notice announcing the hike first appeared in the daily newspaper; that fee would have been a whopping $4000 per ounce.

According to a missive from Avalon Jagnandan, the Administrative Manager at the GGDMA, the association first became aware of the hike when a public notice appeared in the newspaper declaring that all miners and dealers selling gold to the gold board would have to pay the $4000 fee.

“This was immediately rejected by the GGDMA in a number of media publications,” he said. “Since miners and dealers were only paying a processing fee of $1,000 per ounce of gold. This $3,000 proposed increase by the GGB was strongly opposed at all levels by the GGDMA.”

“Subsequently the Association met with the Minister of Natural Resources, Raphael Trotman and the Chairman of the Guyana Gold Board on this matter to represent the Miners’ interest. This meeting was held on Tuesday July 4, 2017 at the Ministry of Natural Resources. Coming out of this meeting the Minister had proposed a processing fee of $3,000. The GGDMA again felt that this was too much for the miners to bear and rejected that amount.”

Jagnandan related that after lengthy negotiations with the Ministry and Gold Board, and considering that the fee was not raised for some time, the GGDMA re-negotiated for an increase taking the fee to $2000.

“However the GGDMA has since been informed in writing by Minister of Natural Resources (Raphael Trotman) that the new processing fee will now be $2500 per ounce of gold and will take effect from September 1st 2017,” Jagnandan stated.

Guyana has had issues with loss of revenue due to gold smuggling and some are questioning whether this hike will exacerbate the situation. Officials of the Federal Bureau of Investigation (FBI) and Homeland Security from the United States of America visited Guyana last year and briefed top officials, including Minister of Public Security Khemraj Ramjattan, about gold smuggling from Guyana.

According to Minister Trotman, it was estimated that approximately 15,000 ounces of the precious metal was smuggled overseas weekly. Trotman said 50 to 60% of local production is lost to smuggling.

“Indicators are that the gold is going to Brazil. It is going over the borders to Suriname, not to stay in Suriname but to go to Europe. It is being landed at Miami International Airport. It is being landed at John F. Kennedy and it is going to the Middle East,” he had told reporters.

For the year, some 163,000 ounces of gold were declared for the first quarter. This follows last year’s healthy declaration of 713,000 ounces. Small and medium-scale miners accounted for some 70 per cent, while Guyana Goldfields and Troy Resources, large gold-mining operations, contributed the remainder.

The Guyana Gold Board recorded 451,490 ounces of gold in 2015. In December last year, Trotman said his Ministry would be aiming for 700,000 ounces in gold declarations for this year. He said the Government was looking forward to all miners producing and declaring high numbers in 2017, and had even pledged to continue to support the industry.

Already, repeated calls from the GGDMA for a meeting with President David Granger in order to air various grievances have gone unfulfilled.

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