Troy Resources faces delays in Region 7 underground gold mine

– pre-feasibility study, ore reserve at mine to be released soon

Australian mining company Troy Resources has hit a snag in its preparations for what was supposed to be its first underground mine in Guyana, the Smarts Underground Prospect in Region Seven (Cuyuni-Mazaruni).
Troy Resources announced in its market update that previous timelines for starting production at the underground site would be delayed listing a number of underlying factors.
These factors include additional drilling being requested by the geotechnical consultants and the resource calculation, as well as lack of contractors and service providers due to the COVID-19 pandemic.
It was noted that despite these setbacks, all the signs point to the Smarts Underground mine being a very valuable asset. According to Troy, approximately 290,000 ounces of gold have been mapped at the site.
“The geotechnical work illustrated that ground conditions for underground mining are excellent. However, previous estimates around the time of completion of reserve calculations, economic assessment and the commencement of production will not be achieved,” Troy Resources said.
It was also noted by Troy that they have 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.
According to the Australian company, this means that the Guyana Geology and Mines Commission (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.
They noted that they are close to announcing the results of a pre-feasibility study and initial ore reserve. Capital costs and other logistics have either been completed or are being finalised currently.
Following several challenges in 2019 and the tragic death of a geologist on site, Troy Resources had resumed operations at its Karouni goldmine after raising approximately US$10.3 million in investment funds.
Troy had announced finding high-grade gold at its Karouni, Smarts Underground mine, in November of last year. According to a report, the mining company encountered 7.08 g/t from a drill hole named SDD191, with a depth of 172 metres.
That drill hole also produced findings of 2.26 g/t at 52.7 metres, 12.98 g/t at 144 metres and 2.35 g/t at 234 metres. A second drill hole assay, labelled SDD192, saw the company encounter 6.58 g/t of gold at 104 metres and 2.59 g/t at 111.
The Smarts deposit started out as an open-pit location. But Troy has always had its eyes set on the future of underground mining. Last month, it had announced the discovery of some 131.93 grams per tonne of gold. Managing Director Ken Nilsson had described it as spectacular.
“Throughout my career, which has spanned multiple mining operations across multiple continents, I have only once previously been involved in the drilling of a hole with results anywhere near as spectacular as those from SDD189,” Nilsson had said last month.
Out of the 634,905 ounces of gold declared in 2019, Troy Resources as one of Guyana’s largest gold producers accounted for a large portion of it. The company, which is Australian-owned and has its operations in Region Seven, reported production figures of 58,118 ounces of gold from its Karouni, Region Seven (Cuyuni-Mazaruni) mine for 2019. In 2018, their gold production figure was 70,207.
Last year, however, it was the small- and medium-scale miners who dominated the gold declarations. They increased their production to 485,552 ounces of gold for the year 2020 – representing 75 per cent of the country’s total production. 584,291 ounces of gold was declared to the Guyana Gold Board in 2020.