Omai Gold Mines Ressurecting Prolific Guyanese Mine

• Omai Gold Mines is focused on the Omai gold project in Guyana, a past producing mine that historically produced 3.7M oz of gold
• The company has done exploration drilling over the past 2.5 years and delineated an additional 3.6M oz of gold
• The goal is to continue expanding resources and advance engineering studies towards re-establishing a large-scale mining operation
• The project benefits from existing infrastructure, known metallurgy, government support to fast-track development
• Takeover by a mid-tier gold producer seen as likely endgame once resource grows large enough (4-5M oz)

Elaine Ellingham, CEO of Omai Gold Mines, recently provided an overview of the company’s activities focused on the Omai gold project in Guyana. Omai is a past-producing mine that saw significant production from 1994 to 2003. During that period, the mine produced 3.7 million ounces of gold in total, with peak production of over 350,000 ounces in 2002.

The mine closed in 2005 when the previous operator, facing financial issues, moved the milling equipment to develop another nearby project. Critically, this meant exploration efforts were halted years before reserves were exhausted. After closure and reclamation, the project sat dormant until recently acquired by Omai Gold Mines.

New Beginning

Since acquiring Omai in 2021, Omai Gold Mines has worked to compile decades of historical data on the project. Ellingham highlighted: “We inherited a massive database of things that goes back to even the 1950s...I have the drill logs, the original written drill logs from the 1950s.” Integrating these historical datasets with modern exploration work has helped the company be highly selective in targeting drill holes during their recent program.

Over the past two and a half years, Omai Gold’s exploration efforts have delineated an additional 3.6M oz of gold resources on the property. Ellingham sees strong potential for further growth: “We believe that deposit can be expanded by at least 50% or more."

With exploration efforts yielding positive results, the company has also now initiated engineering studies focused on re-establishing large-scale mining operations. Ellingham stated:

“We are running in parallel. We're doing the PEA, but obviously the base of that PEA will be the updated resource." Omai Gold sees a preliminary economic assessment, expected in February 2023, as the next step to showcase project potential.

A key advantage is Omai’s brownfield nature. Extensive infrastructure already exists on site from the past operation. Ellingham emphasized that they can reuse key assets: “We have existing tailings facilities, so we have to look at those and see what can be reused." Known metallurgy also substantially de-risks proposals to resume processing using similar flowsheets.

The Guyana government has also voiced strong support in helping advance Omai and other mining projects, given the major economic benefits resource development offers the country. Ellingham touched on this dynamic: "When Omai was in production and employed a thousand people, and this is in a country that only has 800,000 people, so it was the heyday of economic prosperity for Guyana."

With exploration efforts continuing in parallel, Omai Gold’s vision is to continue expanding resources to attract a takeover from a mid-tier or major gold producer. Ellingham sees this as the most likely endgame once the project grows to sufficient scale: “Because most companies would be making a first entry into Guyana, that you have to have probably four or five million ounces and a clear path to production to attract an acquirer."

Recent tensions between Guyana and neighboring Venezuela related to longstanding border disputes have raised some political risk considerations. However, Ellingham believes this reflects posturing tied to Venezuela's elections in late 2024 rather than substantive threats to mining projects: With US and Brazilian backing, Guyana seems well insulated from these regional political tensions.

Overall, Omai Gold is positioned to leverage favorable tailwinds for gold developers, especially those with brownfield advantages. The company offers investors a unique opportunity to capitalize on renewing past production success. Systematically growing resources and de-risking project parameters, Omai Gold aims to ultimately attract a well-capitalized partner to recommission a prominent Guyanese gold mine.

The Investment Thesis for Omai Gold Mines

• Past producer with 3.7M oz of historical gold production from 1993-2005
• Additional 3.6M oz of new resources delineated through recent exploration
• Government supportive of fast-tracking renewed development
• Existing infrastructure and known metallurgy substantially de-risk the project
• Resource growth continues - target >7M oz to attract a takeover bid
• Strong M&A appeal once the project de-risked and scaled to production

Omai Gold represents a unique opportunity to capitalize on re-establishing a prolific past-producing Guyanese gold mine. With exploration efforts systematically growing resources and engineering studies set to showcase project viability, the company is positioning its Omai project for acquisition by a mid-tier producer once scaled to the appropriate size. Investors can capture significant upside potential as this high-margin project advances towards renewed large-scale production.

• Omai offers unique brownfield advantages relative to peers
• Systematic exploration and engineering studies underway
• Mid-tier M&A likely endgame once resources/economics solidified
• Consider position to capitalize on gold sector resurgence