TIDMHUM
RNS Number : 8524T
Hummingbird Resources PLC
18 October 2017
Hummingbird Resources plc / Ticker: HUM / Index: AIM / Sector:
Mining
Hummingbird Resources plc ("Hummingbird" or "the Company")
Q3 2017 Review
Hummingbird Resources (AIM: HUM) is pleased to announce a review
of activities during Q3 2017, including the advancement of mine
construction at the Yanfolila Gold Project in Mali ("Yanfolila" or
"the Project").
Operational
-- Construction of Yanfolila progressed on schedule and on
budget ahead of first gold pour by end of 2017
Area Progress completed*
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Process Design 100%
---------------------- --------------------
Detailed Engineering 100%
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Procurement 100%
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Construction 86%
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Commissioning 0%
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*at end of Q3
-- Commencement of pre-production mining by African Mining Services ("AMS") contract fleet
Corporate
-- US$56m cash in the bank as at 30 September 2017
-- Full draw down of US$60 million debt facility with Coris Bank International
-- Conditional acquisition of 50% interest in the Kobada Gold
Project ("Kobada") owned by African Gold Group Inc ("AGG") and
initial investment into AGG
o Potential to create a high-grade concentrate at Kobada, to be
trucked to Yanfolila and could add an additional 50,000oz gold per
annum to our production
Post period end
-- Cora Gold Limited ("Cora Gold") IPO on AIM- Hummingbird holds a 33.85% interest in Cora Gold
Please click on the following link to see recent pictures and
videos of construction: http://hummingbirdresources.co.uk/gallery/.
This will continue to be updated regularly.
Dan Betts, CEO of Hummingbird, commented:
"We are now in the final quarter of the year and remain on
track, and budget, to deliver first gold by the end of the
2017.
"We have had a positive last quarter, on top of great
construction progress, we announced a commitment to enter into an
agreement with African Gold Group to develop their Kobada gold
project to the north of Yanfolila. Whilst this deal is subject to
satisfactory due diligence over the coming months, we believe this
project will show a compelling economic case to produce a
concentrated product to truck to our Yanfolila plant. We believe
this will materially increase both the annual production output and
the life of the mine at a similar operational cost.
"Post period end, Hummingbird also saw the successful IPO and
funding of Cora Gold, which is set to develop exploration licences
in Mali. Hummingbird was the previous owner of a number of the
permits and holds a 34% shareholding in the company.
"During the next quarter we are set to move through
commissioning and into production and we look forward to updating
the market over this time."
Further Information:
Start of Mining at Yanfolila
Pre-production mining commenced in Q3 as Hummingbird approaches
full scale operations.
During the first phase of mining, there will be areas of free
dig material as well as material that will require light blasting.
Blasting will be conducted using non-electric down hole delay
detonators with ammonium nitrate, fuel oil (ANFO) for dry holes and
emulsion explosives for wet holes. AEL Mining Services will provide
an explosive storage and supply service to the mining
contractor.
Advanced grade control drilling to better delineate the orebody
and improve planning and ore scheduling to the mill is ongoing
together with state of the art Trimble differential GPS and Pix 4D
drone mapping for survey and volumetric calculations.
Conditional Acquisition of 50% Interest in Kobada Gold
Project
On 27 September 2017, the Company announced that it had signed a
Letter of Intent ("LOI") regarding a potential earn-in to a 50%
interest in the Kobada Gold Project ("Kobada" or the "Project") in
Mali owned by AGG and initial investment into AGG (the
"Transaction").
Kobada has 2.2Moz Measured, Indicated and Inferred Gold Resource
(including 511Koz of Reserves) and the Hummingbird team believes
that there is potential to create a high-grade concentrate at
Kobada to be trucked to Yanfolila for processing. It is estimated
that this could add an additional 50,000oz gold per annum to
Yanfolila.
The Transaction is subject to certain conditions, including that
binding agreements are entered into within 45 days.
Terms of the Transaction:
-- Initial investment in AGG of CAD$3.6m for approximately 9.9%
(40,000,000 Units at CAD$0.09c/Unit (each Unit consisting of a
share and a warrant at CAD$0.12 per share))
-- 120-day exclusivity period for due diligence
-- During exclusivity period Hummingbird has the right to
increase shareholding in AGG to 19.2% for a further consideration
of CAD$4.4m at CAD$0.09c/share paid in Hummingbird shares and to
manage the DFS on the Project, which is to be funded by AGG
-- On completion of the DFS Hummingbird has the right to acquire
50% interest in Kobada through funding capex of the Project
-- Hummingbird to receive 70% of cashflows until capex recovered
Debt Facility with Coris Bank International
In July 2017 the Company announced that it had drawn the US$35
million balance of its senior secured loan facility ("Debt
Facility") with Coris Bank International Group ("Coris Bank
International"), one of the largest and fastest growing banks in
West Africa, following the initial US$25 million drawn in April
2017.
This US$60 million facility replaces the funding line previously
anticipated with Taurus Mining Finance Management ("Taurus") to
provide the Company with sufficient working capital to complete the
mine build at Yanfolila at a lower cost and without any royalty
commitment, which will result in a material saving for Hummingbird
over the life of the mine.
Cora Gold Limited
Post period end, on 9 October 2017, Cora Gold Limited, in which
Hummingbird holds a 33.85% interest, announced its admission to
trading on AIM under the EPIC code CORA.L following a successful
fundraise of GBP3.45 million.
Cora Gold is developing a highly prospective gold portfolio
including three principal de-risked project areas covering
1,700km(2) in established gold regions: Yanfolila Gold Belt in Mali
and Kenieba Window in Mali/Senegal with multiple, high potential,
drill ready gold targets.
The funds raised as part of the IPO will be used primarily for
the advancement of the Sanankoro discovery which has demonstrated
its potential for standalone mine development. Sanankoro has been
the subject of substantial historical exploration spend by Randgold
and Gold Fields since 2001, which has provided a comprehensive
database of information. However, to date detailed exploration has
only focused on two zones, of 600m and 1,000m length, within the
14km long gold bearing structures at Sanankoro identified from
reconnaissance drilling.
A 15,000m exploration drilling programme is planned,
prioritising expansion of Sanankoro and up to 10,000m of drilling
will be conducted at additional project areas located near to
existing gold mines and which have the potential to host
significant new gold discoveries.
**ENDS**
For further information, please visit
www.hummingbirdresources.co.uk or contact:
Daniel Betts Hummingbird Resources Tel: +44 (0)20
Thomas Hill plc 3416 3560
Robert Monro
James Spinney Strand Hanson Limited Tel: +44 (0) 20
Ritchie Balmer Nominated & Financial 7409 3494
James Bellman Adviser
Jon Belliss Beaufort Securities Tel: +44 (0) 20
Limited 7382 8300
Broker
Lottie Wadham St Brides Partners Tel: +44 (0) 20
Susie Geliher Ltd 7236 1177
Financial PR/IR
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014.
About Hummingbird Resources Plc
Notes to Editors
Hummingbird Resources (AIM: HUM) is building a leading gold
production, development and exploration company. The Company has
two core gold projects, the near-term production Yanfolila Gold
Project in Mali and the Dugbe Gold Project in Liberia. It is
currently building Yanfolila targeting first production by end of
2017, which has a Probable Reserve of 709,800oz @ 3.14g/t and total
Resources of 1.8Moz of gold and an additional 390,700oz of
non-compliant exploration potential. The high-grade gold project
has low operating costs of US$695/oz AISC with 132,000oz of first
full year's production.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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