Guyana Goldfields

Guyana Goldfields Inc. is a well-financed Canadian-based junior mineral company focused on the exploration and development of gold deposits in the mining-friendly Guiana Shield of Guyana, South America. The company is currently advancing and developing its Aurora Gold Project with a resource of 4.58 million oz (AMEC, August 2009). Initiatives for 2010:

• Environmental and Social Impact Assessment – Q1
• Permitting-Q1
• Hydropower Feasibility Study – Q2
• Definitive Feasibility Study NI43-101 – Q3
• Project Financing (Equity/Debt) – Q3
• Start of Aurora development and construction – Q3

First year of production is mid-2012 with an average of 250,000 oz/yr over a 16 year mine life with operating cash cost of US$364/oz. Total planned production is 4+ million ounces.

CEO Interview (1/10)

"I believe Guyana Goldfields stands to become a sizeable gold producer over the next several years. In fact, I think based on is Aurora Project in Guyana, South America, it has a chance to leap up into the mid-tier level of gold producers in this bull market. And given the massive exploration prospects it could become a top tier gold producer by the end of this decade.

. . .While production is still a ways away, the probability of Guyana Goldfields becoming a gold producer of considerable size is very high. . .competence in Guyana's management team, combined with a strong financial backing, suggests to me the probability of long-term success for patient Guyana shareholders is very high.

Companies with sizeable projects, like Guyana Goldfields has, have the potential to be the 'Homestake Mine' saviors of the current economic depression, which we continue to believe will be as bad as or worse than that of the 1930s."
    -   J.Taylor's Energy & Energy Tech Stocks (01/22/10)

"Upcoming catalysts should continue to drive the shares of Guyana Goldfields Over the recent months, the shares of Guyana Goldfields have shown significant strength. We believe that the potential upcoming catalysts should provide further fuel for the company's share price. The company remains on track for permitting to be completed on its flagship Aurora gold project near the end of the first quarter. We are also expecting a feasibility study to be completed on Aurora, and a subsequent positive construction decision on the project, near the middle of this year.

Given the significant number of upcoming catalysts for the company, we have taken the opportunity to update our valuation. This includes the incorporation of our new long-term gold price of Cdn$800/oz (from US$700/oz previously). Based on this, our new net asset value for the company increases to Cdn$6.97 per share from Cdn$4.74 per share previously.

As we value the company based on a take-out scenario, we continue to use a 1.3x multiple to Net Asset Value, to arrive at our new target price of Cdn$9.00 per share (rounded down from Cdn$9.05), up from Cdn$6.15 per share previously.

We continue to expect that, as the company reaches certain development milestones at the Aurora project, including the permitting of the project, investors will be rewarded by an appreciating share price. Thus, we are maintaining our SPECULATIVE BUY rating on the shares of Guyana Goldfields."
    -HAYTHAM HODALY,   SALMAN PARTNERS INC. (01/08/10)

"Guyana Goldfields is moving toward becoming a sizeable gold producer with production slated to begin in 2012 on its Aurora deposit in Guyana.

. . .I view Guyana Goldfields as an evolving mining company that has a strong probability of joining a select group of companies that produce in excess of 250,000 ounces of gold per year or more. Given the advanced stage of development, much of the risks associated with junior mining companies have been removed. I should also mention that in terms of political risks, Guyana is viewed as one of the more stable jurisdictions outside of North America. Guyana is a democracy, it is a member of the crown, and it has a British legal system in place. It is the only country in South America where English is the primary language.

Given its strong management team and the positive project aspects noted, as well as an assumption that the gold bull market will remain in place for some time to come, I'm betting on this company's ultimate success.

At $1,000 gold that would provide a cash margin of $636 per ounce or $159 million in annual cash flow. In other words, the company is currently selling at a pre-feasibility projected 2.7 times annual cash flow with enormous longer term growth potential and at a point in time when your editor believes is early days for a gold mining bull market. Remember, when it comes to gold mining, what really matters is the 'real' price of gold. When the purchasing power of gold rises, that's bullish for gold mining profit margins. Given. . .enormous upside exploration potential that could multiply that resource by several fold longer term, a strong relationship with the World Bank and a highly competent management team that has the technical talent to build mines, we think Guyana Goldfields represents excellent longer-term value for gold mining share investors. . ."
    -   J.Taylor's Gold, Energy & Tech Stocks (12/15/09)

"Guyana Goldfields is one of our emerging names that holds a 'strategic' asset (4Moz+, not held by a senior company, geopolitically safe jurisdiction), but continues to trade at a P/NAV multiple (0.63x) below others with similar 'strategic' assets, such as Detour (0.67x), Romarco (0.81x), and Osisko (0.85x).

The Aurora project's location (in Guyana) is higher risk than Canada or the USA (where the other companies' projects are located), but Guyana, a former British colony, has an excellent mining history and the prime minister (who is also the mining minister) is Canadian-educated and has specifically expressed his support for the project.

While the project does have some higher technical risk than some of the comparables (proximity to a river, and both open pit and underground exploitation) it also boasts the best grades. Final key permits are expected in Q1 2010, and a definitive feasibility study and production decision are expected in Q2 2010."
    -DON MACLEAN,   PARADIGM CAPITAL INC. (12/01/09)

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