INVESTMENT IN THE MINING SECTOR

Mining is one of the main revenue producing industries in the country with international companies having operations or interest in operations in Guyana.

Guyana’s mineral resources include bauxite, laterite, manganese, kaolin, sand resources, gold, diamonds, copper, radio active materials, molybdenum, tungsten, iron and nickel.

There is evidence of the existence of oil and gas resources in Guyana, especially in the Takutu Basin located approximately 300 miles south-south-west of Georgetown and in the mouth of the Corentyne river which divides Guyana and Suriname. The Government has signed agreements with a number of major companies to carry out off-shore and on-shore exploration activities.

The Guyana Geology and Mines Commission is responsible for the management of the mineral and petroleum sectors within an established legal and policy framework.

There are three scales of operations:

Small scale claims- approximately 27 acres

Medium- up to 1,200 acres

Large- approximately 12,000 acres

Concessions are granted in priority of date of application and subject to availability. Small and medium scale grants may be held by Guyanese nationals only. However, large sale operations may be held by foreigners, Guyanese or through joint ventures.

Opportunities exist in large scale prospecting and mining for foreign investors.

Foreign investors in Guyana include Camboir/ Omai Gold Mines Ltd., Golden star Resources Ltd. Reynolds and Alcan.

Large scale prospecting/ mining of gold, precious metals, diamonds and precious stones attracts royalties of 5% of gross revenue and tax at 35%.

The Government guarantees:

100% foreign ownership of large scale prospecting and mining

secure tenure of property rights

right to transfer and assign rights under prospecting and mining licences

right to peacefully and quietly possess the land alienated under the Prospecting or Mining licence without undue interference.

simplified application and licencing procedures

In recent years there have been joint ventures between local medium and large scale permit holders and foreign mining companies which have resulted in several IPOs on the Toronto Stock exchange.

HFS Corporate Services Inc. has advised and counseled several clients in their preparations for the launch of IPOs.