The Dominican Republic is the larger of two Caribbean nations on the island of Hispaniola, with its smaller neighbor being Haiti. Often referred to simply as the DR, the Dominican Republic is increasingly developing a reputation as a small nation with big opportunities for gold miners.
The Pueblo Viejo mine, a 60/40 joint venture between Barrick Gold (NYSE:ABX,TSX:ABX) and Goldcorp (TSX:G,NYSE:GG) that achieved commercial production in January, has certainly helped boost the nation’s reputation.
Pueblo Viejo is a polymetallic deposit with 15 million ounces of proven and probable gold reserves and a minelife of Hallo over 25 years. And with a price tag of about $3.7 billion, it is the largest investment that has been made in the island nation. However, it is far from the only one.
Also found in the region are Perilya’s (ASX:PEM) Cerro de Maimon copper-gold mine, PanTerra Gold’s (ASX:EVG) Las Lagunas gold tailings project and Xstrata’s (LSE:XTA) Falcondo nickelcomplex.
A host of junior miners, including Everton Resources (TSXV:EVR), Precipitate Gold (TSXV:PRG), Santo Mining (OTC Pink:SANP), Unigold (TSXV:UGD) and GoldQuest Mining (TSXV:GQC) have also been attracted to the Dominican Republic:
Everton Resources has gold, silver and copper properties in the Dominican with land claims totalling over 300 square kilometers. In January, a study from the University of Barcelona confirmed the discovery of a volcanogenic massive sulphide (VMS) and VMS-epithermal deposit at Everton’s Ampliación Pueblo Viejo II concession, adjacent to Barrick and Goldcorp’s Pueblo Viejo mine. New survey and assay results were also announced from the Ponton and Jarabacoa properties in March.
Precipitate Gold has two concessions adjacent to the Romero and La Escandalosa projects, Escort two of GoldQuest’s discoveries. Survey results completed in December 2012 have refined and expanded two target areas, the Mechor and Ginger Ridge gold zones.
Unigold is concentrating its endeavors on the Candelones zone of its Neita property. Its share price gained 164 percent in 2012 following drill results that included 69.4 meters at 3.75 g/t gold and 20.2 meters at 2.6 g/t gold. Last November, Unigold announced the discovery of a new area of mineralization on the Neita property.
GoldQuest was the darling of the junior gold mining sector last year. Its stock price increased by 726- percent in 2012 after the company returned an impressive set of drill results from its Romero project. While the stock has since fallen from those dizzying heights, the company rose 30 percent last month after it announced the discovery of a new copper- and gold-bearing trend.
Right now, gold miners are more interested in the Dominican Republic than they are in Australia or Canada, said Mr. Virgilio Santana Ripoll of Santana Ripoll & Associates, a firm that provides services to the mining industry.
“I can say that all eyes are on the Dominican Republic for mine development,” he told Gold Investing News (GIN). Any of the projects in the country are found in and around the cheap jerseys the mineral-rich Hispaniola Gold-Copper Back-Arc. Within that larger zone, the Tireo formation is gaining attention.
It stretches across the border from Haiti and into the Dominican Republic — both Unigold and GoldQuest have posted notable wholesale jerseys China results from their work there.
The Tireo formation is bound both by structural and geological controls, explained Andrew Cheatle, CEO of Unigold, in an interview with GIN. “What’s amazing about it is that a geologist could look at the rocks from our property and fly down to GoldQuest, and the similarities in the mineralization styles and the rocks would be very evident.”
He said the trend has been known for a number of years, but has not really captured the market’s attention until now. Together, results from Unigold and GoldQuest have greatly helped to change that.
Cheatle noted that another upside to the Dominican Republic is that investors have so far reacted positively to the work being done there.
“If you look at the share price performance of companies that have been involved in the Dominican Republic over the last year — GoldQuest, ourselves — we’ve performed relatively well. And that is on the back of some very, very good results that have been released over the last 15 months.”
The government is also supportive of the overall development of the sector, he said. That is an assessment that tends to be echoed throughout the industry.
Infrastructure is considered good, with adequate paved roads, water and electricity. Additionally, the Dominican Republic is easily accessible, only about a four-hour flight from Toronto or a two-hour flight from Miami, Cheatle said.
However, one of the downsides of working in the Dominican is bureaucracy and long processing wholesale jerseys times. The central part of the country is heavily staked, but many claim holders are frustrated about a bottleneck that has some projects stalled. Added to that is a mining industry that is evolving under new leadership.
In addition to being an attorney, Santana Ripoll, of the mining services firm, is also one of the DR’s concessionaires. He has four properties that he is aiming to sell or joint venture and has already received the permits that he needs for two.
Santana Ripoll said he has been in the process of getting permits for the latter two for about a year. However, that whole year has not been spent waiting; part of the time was consumed with “getting the paperwork, hiring a geologist, doing the planning and the exploration work,” he explained.
Since fulfilling all the requirements, he has been waiting three months and he expects the wait to span another three months. That, he said, is a normal processing period. “I know people and companies that have been waiting cheap mlb jerseys for two or three years. But it’s not the mining office’s fault. Many, many people I know are intending to do things by themselves and that is why it is taking so long. When you don’t know about something you have to hire people with skills and capacities to help you,” he said.
“But most of the people, what they do is send information [that is] incomplete. That is why it takes many of the concessionaires so long to get their permission. But if you hire a lawyer and you hire a geologist, you should not have any problems.”
Santana Ripoll said things are moving faster with the new mining director, Alexander cheap jerseys Medina, in office. Cheatle also noted improvements and exuded a sense of optimism.
“The government recognizes that it needs to streamline and expedite the application processes in a fair way. So as we look forward what we will do is see. We see the government requesting that people provide very clear documentation, work plans and the ability to do work,” Cheatle said.
Concerns over bureaucracy and delays have been coupled with negative headlines about the government’s desire to revise its contract with Barrick regarding Pueblo Viejo. The president has said that under the existing contract, the government does not receive enough benefits. The government recently detained a gold shipment that has now been released.
Still, most investors in the Dominican Republic are looking on the bright side. “This country has tremendous opportunity and promise in mining,” said Santo Mining’s French.
Securities Disclosure: I, Michelle Smith, do not hold equity interests in any of the companies mentioned in this article.