Guyana Goldfields commences underground development of Aurora Mine

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Guyana Goldfields Inc. has announced that the Company has commenced underground development at the Aurora Mine completing the first blast on the Mad Kiss portal.

The Canadian company in a statement said that the contractor will complete and reinforce the collar and extend the decline 200 metres to fulfill the scope of the early works phase.

“The Company expects this will be completed early in Q1, 2019. The Company is finalizing the review of bids received for the underground development contract with the target of final award in the fourth quarter of 2018” said the statement.

It was outlined that the plan is to advance the exploration decline approximately 2,500 metres and provide a platform for further underground exploration and definition drilling.

The decline is intended to provide access to all principal underground mining areas, including some higher-grade zones in Mad Kiss and East Walcott that could potentially provide supplemental mill feed during the development period.

According to Scott A. Caldwell, President & CEO of the company “the blast is a key milestone marking the commencement of underground construction. The decline provides an ideal platform to potentially upgrade and expand the current underground resource and unlock the full potential of the Aurora deposit.”

Guyana Goldfields Inc. recently reported a 50 per cent downward third quarter in its 2018 operational and financial results on its revised guidance.

The company had revealed that the 2018 gold production guidance was revised downwards to 150,000-155,000 ounces as grades have reportedly not rebounded as quickly as anticipated in the fourth quarter.

This is down from a previous guidance range of 175,000 -185,000 ounces of gold.

The Company had an improved third quarter of 2018 from both a production and cost perspective, driven by improved mining rates. The average head grade, however, was lower than anticipated.

As such, an independent firm of engineers and geologist have since been employed to investigate the geologic controls and grade variability of the deposit.

The Company expects the results from this review to be incorporated in the 2019 guidance and annual reserve and resource update to be disclosed in the first quarter of 2019.

Caldwell had expressed disappointment regarding the revised guidance’s report.

The CEO however, disclosed that there is some good news with regards to a 17 per cent increase in the company’s average, mining rate.

“We are achieving targeted levels of 70,000 tpd. In addition, the mill continues to perform exceedingly well with throughput and recovery rates delivering continuously above designed rates. We are excited to advance underground development to help alleviate the cyclical production nature of the Aurora open pits and the contractor has already mobilized and initiated field work earlier this month, with the portal collar scheduled to be completed in the fourth quarter” Caldwell revealed.

Guyana Goldfields is a Canadian mid-tier gold producer, primarily focused on the exploration and development of gold deposits in the Guiana Shield of South America.

According to the company, the “Net loss for the third quarter of 2018 amounted to [US] $2.2 million ($0.01 per diluted share) which was influenced by increased deferred tax expense and management restructuring charges.”

Moreover it was outlined that the company “finished the third quarter with a cash balance of $92.6 million which provides ample capacity to meet near-term liquidity requirements consisting of capital purchase commitments of $13.5 million and scheduled principal debt repayments of $20.0 million over the next four quarters. As at September 30, 2018, $45.0 million of principal debt was outstanding.”

Following the downward revision in its 2018 gold production guidance, stocks for Guyana Goldfields Inc fell sharply.

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