Troy Resources faces delays in Guyana’s first underground mine


Troy Resources’ (TRY) share price has dropped today after updating the market on its Karouni Gold Project in Guyana.

The company has seen bittersweet exploration results at the project.

Over the month of April, gold production at the project totalled 2140 ounces. Forecast production for the months of May and June are 2400 and 1909 ounces, respectively.

The primary source of ore delivered to the mill over the last 15 months, has been the Hicks 4 open cut, with the Spearpoint open-cut producing a modest contribution over the recent months.

Smarts Underground

The Smarts Underground prospect is expected to be the primary ongoing source of mill feed at Karouni, once it comes into production.

The underground prospect is expected to have a mineral resource of three million tonnes at 3.3g/t of gold for around 290,000 ounces of gold.

Last year, the company undertook drilling for both resource definition and geotechnical purposes.

However, the project has faced delays and will now not be completed as expected. Delays have been due to additional drilling requested by consultants and the lack of time availability of contractors and service providers due to COVID-19.

The pre-feasibility study and the initial ore reserve is nearly completed and Troy is expecting to announce the results shortly.

Troy has been trying to get a permit for the underground mine for some time now. One key challenge has been that there has never been an underground mine developed in Guyana, meaning the country’s Mines Department (GGMC) has no experience in this area.

However, the government is highly supportive of the project and has already issued the company a permit to commence infrastructure works.

“Troy is working closely with GGMC and other government departments to assist in the formulation of a set of Mining Regulations for underground mining operations in Guyana,” the company told the market.

Pause on ore processing activities

Troy has decided to pause its ore processing activities, meaning no mill feed will be available for the Karouni mill.

This decision has come after ore from Hicks 4 and Spearpoint will be exhausted by late June or early July 2021 and Smarts Underground will not likely produce its first ore until later this year.

The company has been exploring the availability of a third-party for toll treating and other opportunties but nothing has been reported at this stage.

Due to all of this, Troy is expecting ore processing activities will cease at Karouni in August or September and the mill will be put on care and maintenance.

During this time, Troy will renew worn equipment and improve various modifications, which will be beneficial once processing recommences.


At the Goldstar Prospect, around 13 kilometres from the Karouni Mill, a mineral resources of 25,000 ounces has been previously identified.

From late last year and early 2021, Troy conducted drilling at the prospect with results achieving reasonable results.

However, the optimisation work at Goldstar has been disappointing, resulting in
the mapping of a less-than-anticipated ore reserve of approximately 74,000 tonnes at 1.2 g/t gold for approximately 2,600 ounces.

Troy intends to further explore the prospect in the upcoming dry season.


Additionally, over the past six months, Troy has purchased the Potaro prospects, which are located near Karouni.

Troy identified the project as a must-have target around two years ago as it will increase the Karouni project by around 3000 hectares.

Notably, the Pataro River and local tributaries have been heavily mined for alluvial gold.

“Troy considers that these newly acquired tenements have the potential to host significant gold mineralisation and will form a key component of the company’s exploration strategy going forward,” Troy told the market.

On the market today, Troy is down 16.9 per cent and is trading at 5.4 cents per share at 3:23 pm AEST.