New resources at Paul Isnard and St. Elie brighten Guyanor’s outlook

While lower metal prices have dampened enthusiasm for its 1998 exploration program in French Guiana, Guyanor Ressources (GRL.B-T) has put its best face forward with new mineral inventories from two gold properties in the French overseas department, lodged between Suriname and Brazil.

That gold prices have depressed the industry is no surprise. But, Guyanor has been informed by Asarco (AR-N) that the major will defer exploration spending on the companies’ shared gold properties in French Guiana because of low copper prices.

Low prices are putting the pinch on Asarco’s copper mines, forcing that company to re-evaluate its spending priorities. But Guyanor has countered this bad news with new mineral inventories for the Paul Isnard and St. Elie projects, lifting the company’s total inventory to twice what it was in 1997.

At Paul Isnard, Guyanor put the in situ resource through a computer model and determined an initial resource estimate of 18.7 million tonnes grading 2.5 grams of gold per tonne (for 1.5 million oz. of gold). It is based on 48 core holes (9,362 metres) on the Montagne d’Or zone.

The estimate used a cutoff grade of 0.7 gram gold per tonne for saprolitic material and 0.9 gram for hard rock, and assumed a gold price of US$350 per oz. The stripping ratio came to 6-to-1.

Guyanor holds an 84% interest in Paul Isnard. Asarco can earn a half-interest in Guyanor’s stake by either spending a minimum of US$10 million and completing feasibility studies on both the Paul Isnard and Eau Blanche projects, or by combining both projects into one, with a minimum 5-year expenditure of US$20 million.

At this point, Asarco has deferred its exploration spending on this project for the first half of 1998. However, it is moving toward feasibility on its own Camp Caiman gold project, also in French Guiana.

At St. Elie, a 50-50 partnership of Guyanor and Asarco, the estimate resource stands at 1.4 million tonnes grading 4.2 grams gold per tonne (for just under 190,000 oz. of gold) in the Michel zone. Using the same parameters as Paul Isnard, the stripping ratio came to 13-to-1. The resource estimate is based on 53 core holes totaling 7,632 metres.

Its share of St. Elie brings Guyanor’s attributable mineral inventory to a total of 17 million tonnes at an average grade of 2.3 grams per tonne, more than double the figure for 1997. The total inventory also incorporates revised numbers for the Yaou-Dorlin project, also in French Guiana, which decreased to 16.8 million tonnes grading 1.9 oz. gold (just over 1 million oz.) when the assumed price of gold was lowered (US$400 per oz. had been assumed in previous calculations).

Guyanor plans to further update the existing geologic models at Yaou-Dorlin with another 70 holes (totalling 10,000 metres) completed since mid-1997.

The data will serve as the basis for determining mining reserves for a prefeasibility study, which is expected to be completed during the second quarter of the year. It will also be used to guide exploration activity at the property during the field season.

Guyanor shares the project equally with Cambior (CBJ-T).

Guyanor’s parent company, Golden Star Resources (GSC-T), has also revised reserves and resources for its properties based on a gold price of US$350 per oz.

At the Omai gold mine in Guyana, reserves now stand at 54.1 million tonnes grading 1.4 grams gold (for 2.5 million oz.). Golden Star owns a 30% stake in the mine, Cambior, which operates the mine, owns 65% and the remainder is held by the Guyanese government.

The Gross Rosebel project in Suriname, a 50-50 partnership between Golder Star and Cambior, contains reserves of 35.5 million tonnes at 1.8 grams per tonne (for just under 2 million oz.). A lower gold price assumption knocked 18% off of last year’s reserve figure.

In all, Golden Star saw a decrease of 14% in its attributable ounces using the lower gold price assumption.

Golden Star recently began drilling at the Makapa gold project in northwestern Guyana. The company plans 12 to 15 holes on the Fennell vein, which is exposed at surface for a strike length of 185 metres.