Success of Omai mine bodes well for Cambior

Montreal-based Cambior (TSE) has been the driving force behind getting the Omai gold mine in Guyana on stream.

Omai, owned 65% by Cambior, 30% by Denver-based Golden Star Resources (TSE) and 5% by the government of Guyana, was the first major mine to be put into production in the Guiana Shield, which, in many ways, is geologically similar to the Canadian Shield.

Through the 1970s and 1980s, the Guyanese government nationalized industries which, in turn, had the effect of discouraging foreign investment. With a change in government policy in the late 1980s, foreign investment was revived, thus re-opening the door to mining companies.

Omai went into production in January, 1993, and poured its first gold the next month. Production in the first year was 206,537 oz. from 4.4 million tons of ore milled.

Both numbers were below expectations, the result of problems with material handling and milling. Changes were made and production for the first half of this year totaled 126,961 oz. gold from 2.4 million tons. The 1994 target is 272,000 oz.

The mine is 160 km from Georgetown, the Guyanese capital. It is accessible by road or air.

Omai has three sources of ore: the Fennell pit, the Wenot Lake pits and the alluvial deposits. In 1993, all the ore that was processed came from the Fennell pit. This year it will be the only source of high-grade “hard rock” ore; the Wenot Lake pits and the alluvials will contribute high-grade oxidized ore.

As of year-end 1993, the minable reserves stood at 55.5 million tons grading 0.045 oz. gold per ton, representing almost 2.5 million oz. gold in situ — an increase of 9% from a year earlier and 27% higher than the reserve estimates in the 1990 feasibility study.

The boost in reserves can be attributed to an increased slope in the Fennell pit wall and the discovery of additional ore during mining.

A definition drilling and exploration program was completed around the Fennell pit in July. The results indicate an extension of the mineralization to the northwest and at depth.

A similar program is under way in the Wenot Lake pits.

A new minable resource estimate will be available for the Fennell pit at the end of the third quarter.

A budget for the preparation of a feasibility study to expand the Omai mill capacity by 50% has been approved, but the study will depend on the results of the current drill program.

Now that Cambior has established itself in the Guiana Shield with the Omai mine, it is casting about for other projects to take on.

In May of this year, Cambior and Golden Star signed an agreement whereby the former can earn a half interest in the Yaou-Dorlin gold project in French Guiana. The project covers two gold prospects in the southwest part of the country.

The Yaou prospect consists of six exploration permits on which previous work resulted in the discovery of several mineralized zones. The Dorlin property, which also consists of six exploration permits, has been identified by reconnaissance geochemical surveys as an area with good potential for hosting both gold and base metal deposits.

Cambior has to spend US$11 million by June, 1998, to earn its interest. Golden Star, which has experience in the Guiana Shield, will supervise the exploration phase and Cambior will supervise development.

Following the Yaou-Dorlin agreement, the two companies announced that they had reached another agreement — this time for the Gross Rosebel property, 80 km south of Paramaribo, the capital of Suriname. The 170-sq.-km concession hosts several gold-bearing structures that have been explored only partially. Cambior can acquire a half interest in the property by spending about US$6 million on exploration and development by June, 1996. Golden Star will manage all exploration while Cambior will prepare a feasibility study and carry out mine development.

Cambior is in the enviable position of being the first, and so far the only, major gold producer in Guyana, Suriname or French Guiana, and now it can shop around for the best exploration plays in the region.

With its joint-venture partner Golden Star (a company with strong exploration experience in this part of the world) and the cash flow from Omai, Cambior has the expertise and wherewithal to advance other exploration projects to production.

— The author is a Toronto-based freelance writer.