The Natural Resources Ministry has released its draft National Mineral Sector Policy Framework, which covers the years 2019 to 2029. Included in the policy are several proposals for improving the mining sector.
According to the recently released policy document, recommendations include a miner’s assistance scheme, paved hinterland road networks and an Inspector General’s Office for the Guyana Geology and Mines Commission (GGMC).
According to the document, “most small scale mining enterprises lack the required level of capitalisation, mechanisation and technical application.” The document notes that assistance could take several forms, including loan and equity-based financing schemes, hire-purchase schemes, donor and Government support schemes and providing financing through cooperation between small and large-scale miners and through buyer credit schemes.
The document gives some details about this proposal, noting that priority treatment can be given to miners without such equipment, to syndicates and other partnership arrangements, as well as the granting of waivers on all duties for targeted equipment.
Providing justification for this proposal, the document recommends miners lodge partial collateral, set at a percentage of the cost price of the equipment. This collateral, according to the policy, could be land, a cash bond or a freeze on the account of a guarantor, with little to no interest on repayments and a grace period before the first payment of instalment.
It also proposes “a repayment scheme that awards points to the miner for gold declarations over a certain amount. The higher the declaration, the more the Government reduces the debt (and a) reward for quick payback of debt in the form of a full transfer of ownership of the equipment to the miner if a large amount of the debt, for example, 80 per cent, is repaid within a short period.
The document also recommends auctioning off all reclaimed equipment by the State, with a pre-set floor price to create a level playing field. Besides the miner’s assistance scheme, a proposal is also made for upgraded training and extension services to miners.
The document proposes “building on the experience, outputs (in particular the codes of practice) and recommendations of the GENCAPD (Guyana Environmental and Capacity Development) field studies, the Responsible Mining initiative of Conservation International, and other such projects.”
It also recommends expanding waivers for green mining technologies and expanding the Guyana Mining School. To make more land available, the document also recommends ways of discouraging persons sitting idly on mining blocks, instead of actually mining.
In addition, the document speaks to a national geo-data acquisition and dissemination program. According to the document, national decisions pertaining to the mining sector must rely on objective data collection.
In the case of the poor state of hinterland roads, the policy document acknowledg
es that this is a challenge miners must grapple with. It acknowledges that small and medium scale miners could significantly lower their transportation costs with better road networks.
Last year, the Natural Resources Ministry had announced that with the support of the GGMC, it would be moving forward with the maintenance of several roads in hinterland communities that were in a deplorable state. These rehabilitative works were to be done in collaboration with the Public Infrastructure Ministry.
At the beginning of June 2018, six road contracts valued at over $650 million were awarded to various contractors for the maintenance of the Rockstone-Mabura, Kurupukari-Annai-Lethem, and the Linden-Ituni-Kwakwani roads. This is in addition to a previous contract that was awarded to JR Ranch for the Manari Bridge realignment in Region Nine, Rupununi, which was valued at $83 million.
Particularly, rehabilitation of the Linden-Ituni-Kwakwani Road in Region 10 (Upper Demerara-Berbice) was supposed to recommence at the end of the May-June rainy season. The contracts were awarded for repairs to the roads to International Imports and Supplies to the tune of $239.7 million.
Calls have been made for assistance, whether in the form of better roads or capital financing, for the mining sector for some time. Earlier this month, a drop in declarations for last year compared to 2017 had been announced.
As of December 31, 2018, total declarations from all sources amount to 613,073 ounces, which was 6.22 per cent lower than the figures from 2017. Additionally, the foreign exchange value of exports processed on behalf of dealers and the Guyana Gold Board (GGB) came to US$443,961,666.
The GGB has meanwhile projected that for 2019, declarations and exportations will be at 651,000 ounces.
Many have posited that for a country that derives so much foreign currency earnings from the mining sector, maintaining this sector’s performance is vital for a balanced economy when oil and gas revenue starts rolling in. (Jarryl Bryan)