Dynacor Gold Mines Inc. [DNG-TSX] is somewhat unique amongst dividend paying gold producers. The Montreal based company does not actually have any mines of its own but began operations in southern Peru in 1996 with the construction of the Huanca-Acari gold ore-processing plant designed to custom mill ore supplied by artisanal and small-scale gold miners – ASGM’s. These miners are a traditional livelihood in Peru and provide much needed income for many impoverished communities.
Ore is currently supplied from over 600 ASGM’s located all over Peru. As all ore suppliers must be registered with the government to discourage illegal miners from operating the company is well supported by various levels of government and local communities throughout the country.
From a modest start of some 3000 ounces a year of production back in 1998, Dynacor today is the largest custom gold ore-processing company in Peru. In July this year, production peaked at a record 10,800 ounces per month. The Huanca – Acari site is no longer in operation and ore is now processed through the company’s Veta Dorada gold processing plant, a traditional CIP (carbon-in-pulp) operation, first commissioned in 2016 starting with a nameplate capacity of 300 TPD. The plant is located fifteen minutes off the Pan American Highway near Chala in southern Peru. Veta Dorada successfully reached its total production capacity of 430 TPD in July and Dynacor expects to operate the mill at the maximum capacity of 430 TPD throughout the remaining year. This plant is designed to be readily expandable to 450 tpd (153,000 tpy) and then to 600 tpd (204,000 tpy) by adding additional processing lines and ball mills.
With such a varied supply base, metallurgical control on the plant is crucial. Blending of ores is paramount to ensure smooth operations. To achieve this and ensure gold recoveries are maintained at the highest levels, some 200 personnel are employed at Veta Dorada many of whom are metallurgical staff engaged in testing and assaying activities.
Dynacor operates the PX Impact gold program. In essence this program ensures end users of Dynacors gold in the fine luxury jewellery, watchmaking and investment sectors pay a small premium to Dynacors customer and strategic partner in Switzerland. This premium is used to provide direct investment to developing health and education projects within the ASGM communities.
In addition to its gold production, Dynacor is advancing exploration of its mining concessions and since 2001 has spent more than US$ 15 million dollars on the exploration of its flagship property, Tumipampa. In 2008, the company identified a polymetallic skarn on the property and in 2013 it discovered very high gold grades in the Manto Dorado vein structure.
The company has a partnership with a sovereign fund and mill manufacturer in Senegal and is preparing to establish a similar ore processing operation in West Africa and other ASM-specific countries. As a result, Dynacor sees itself elevating as the global leader in ASM gold ore purchasing and processing.