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MINING | HUMMINGBIRD RESOURCES
MMINGBIRD RESOURCES
significant news flow from one of West Africa’s most exciting gold firms
Regular readers of RGN will be very familiar with AIM-listed gold explorer and producer Hummingbird Resources by now. This publication has been following the company’s West African story since 2016, when it had only then completed a definitive feasibility study (DFS) for the Yanfolila gold project in Mali, having pivoted away from its original exploration asset in Liberia. Over the last four years, Hummingbird has delivered the Yanfolila mine on-time and on-budget, transforming itself from an explorer to a producer in the process. After reaching nameplate capacity in early 2018, the highly flexible team skilfully navigated operational challenges at the mine in 2019 and boosted throughput through the addition of a second ball mill, all while maintaining a prominent position in the local Sikasso region through a series of generous community development programmes. 2020 has been another year of significant news flow for Hummingbird, despite the worrying emergence of a global pandemic that has posed a challenge not just to the company’s finances but more importantly to its stakeholders.
“There’s no doubt it’s been very challenging,” says managing director Dan Betts. “We operate a remote mine in a remote jurisdiction and Mali’s borders have been closed for some time, which has given us a lot of supply chain and logistics issues. “We’ve had to increase our inventory of spares, fuel and supplies so we can sustain unforeseen events, but when things do go wrong it’s hard to get parts to site and this has a cost implication for the company.” However, Betts believes that by far the biggest challenge posed by COVID-19 has been maintaining morale and managing fatigue on-site at Yanfolila. The pandemic has dictated a stricter focus on employee health and safety, which has meant changing shift patterns from normal with time off to an intense 15-week spell on-site for many staff.
MINING | HUMMINGBIRD RESOURCES
of the Kouroussa Gold Project
going so well, but it’s been
Going into Guinea
a tough ask for our team.
Despite these significant
Cassidy Gold Corp in June,
Another challenge has been
impediments to
moving into a third West
not knowing. You can’t really
Hummingbird’s regular
African jurisdiction in the
plan in this time, so it’s been
operational and corporate
process.
a case of reactive planning
rhythms, the company has
depending on what rules
remained active in the market
governments have thrown at
and announced the acquisition development asset in Guinea’s
“It’s amazing they’ve kept
us.”
in Guinea from junior explorer
The deal for this near-term prolific Siguiri Basin perfectly
MINING | HUMMINGBIRD RESOURCES
aligns with Hummingbird’s
per year. This bracket sounds
strategy of building a high
great on a spreadsheet but it’s
grade, high margin gold
actually very hard to find this
Kouroussa has a mineral
producer in West Africa and
type of project which is slightly
resource of 1.18 million oz of
it complements the Yanfolila
sub-scale for the majors and
gold, which Hummingbird has
mine in more ways than one.
the mid-tiers, but big enough
applied significant dilution
to be a substantial employer
to, but is still returning head
“We were aiming for a project
and revenue generator for us.
grades at over 3 g/t gold
with a production profile of
The Kouroussa project was a
according to Betts. “There
around 100-150,000 ounces (oz)
little gem in that respect.”
HUMMINGBIRD
were some absolutely knock
flowsheets and process plant
RESOURCES
out drill holes there and I
design and even service
think the exploration potential
providers as they are in the
is huge as well,” he says. First
same broad geographic region
gold is expected in under two
in West Africa.
AT A G L A N C E
years, when the mine will
STOCK TICKER AIM:HUM
MARKET CAPITALISATION
£101.5 million (as of June 24, 2020)
aj
produce around 100,000 oz per
“We can take a lot of synergy
annum.
from everything we have done at Yanfolila and transport it
In addition, there exist
across to Kouroussa, which
several similarities between
should help us build the mine
Kouroussa and Yanfolila, in
very effectively. We have kept
terms of the scale of both
the same project team together
projects, the metallurgical
from Yanfolila and after the second ball mill, this is the
MINING | HUMMINGBIRD RESOURCES
MINING | HUMMINGBIRD RESOURCES
third build that project team
it hosts plenty of major mining
there is no need to cross land
will work on.”
companies as a result.
borders to get on-site.
A mature mining sector
For Hummingbird, Guinea
“In terms of physical security,
represents a new political
Guinea is slightly more stable
While not as mature as Mali’s
environment – which always
than Burkina and Mali at the
gold sector, Guinea is by no
takes time to acclimatise
moment. I think it’s a good
means a fledgling mining
to. However, Betts believes
time to enter, certainly in
jurisdiction. Thanks to its
this adaption comes with
terms of gold exploration
world class bauxite and bulk
no significant risk. In fact,
around the Siguiri gold
commodities industries,
working in Guinea may
belt. There have been some
the country has established
actually be smoother as the
amazing drill holes come out
infrastructure, a strong
country has its own port and
recently from the Australian
understanding of mining and
juniors and I think there is
DAN BETTS, HUMMINGBIRD RESOURCES MANAGING DIRECTOR
MINING | HUMMINGBIRD RESOURCES
going to be a lot of activity in this part of Guinea over the next 10 years.” Hummingbird is already busying itself at the Kouroussa project crossing Ts and dotting Is in terms of permitting and government approval for the change of hands. The company is in dialogue with the government and is pleased to have received early support from the authorities. “They [the government] seem very supportive of Hummingbird’s involvement and I don’t foresee any problems, so the team is now working on refining the detail and the scope of the plant.” Throughout the remainder of the year, the company plans to refine the Kouroussa feasibility study and enlarge the scope of the plant, making it more comparable to the Yanfolila operation. “We’re imagining a circa 1-1.2 million tonnes per year plant,
Dan Betts, Hummingbird Resources managing director
two-stage crushing, CIL gravity
presented problems due to its
while funding all other costs
circuit producing in the region
vast scale.
during the two-year period,
of 100,000 oz per year,” Betts
earning a 49% interest in the
envisions. “Hopefully we will
“It’s going to be a huge
be ready to start construction
project. Remember the first
at the beginning of next year.”
164 drill holes we did all hit
The agreement should also
mineralisation. There is so
unlock a huge amount of value
much gold there to be found,
for Hummingbird’s investors,
but we felt it needed someone
according to Betts. “When
with a longer-term mindset
ARX lists in Canada it will
Also in June, Hummingbird
to do more exploration and
be a separate entity with a
sealed an earn-in agreement
expand the project. That’s what direct look-through value for
with ARX Resources for the
ARX is doing.”
Sharing the workload in Liberia
Dugbe project (its original
project.
Hummingbird’s shareholders. And then at the end of it all,
West African asset). Liberia
Under the terms of the deal,
Hummingbird converts its
has been a tough nut to crack
ARX will spend US$10 million
51% in the project into 51% of
for the company over the past
on further exploration and
the company and maintains
five years and the project itself
commit to completing a DFS
control of the asset. I think it’s a fantastic deal.”
MINING | HUMMINGBIRD RESOURCES
In a third major piece of news
to find ways to promote the
community and healthcare. “I
flow in June, Hummingbird
industry and all the good work
think that is something to be
confirmed its membership
it does. That’s the bit of the
immensely proud of and I’m
with the World Gold Council
relationship I am most looking
looking forward to being a part
– a point of real pride for
forward to; looking at how we
of that with the World Gold
the company’s managing
can promote and be proud of
Council.”
director. “I see the Council as
the gold mining industry.” Betts is quick to highlight the
Assisting the COVID-19 effort
admirable work that the gold
In a particularly fraught
“It has many capable and
sector does around the world
time for all of its people,
respected people looking
in terms of R&D, environment,
Hummingbird has gone
the highest body in the gold industry.
MINING | HUMMINGBIRD RESOURCES
health education, including
resource expansion at
bringing in an additional
Yanfolila as one of its key
site doctor who has provided
annual targets. This has
valuable assistance to our
not changed even after the
medical team in supporting
outbreak of COVID-19 and
Hummingbird’s COVID-19
all of its implications on the
response.
ground.
“In addition, we have made
In early June, the company
donations to the Malian
announced some encouraging
government and local
drill holes from underground
health authorities, offering
drilling at Komana East, and
direct support to our local
there are hopes this could
communities with initiatives
prove up the underground
such as soap manufacturing.
mining concept at Yanfolila
We have been buying
and add long-term oz to the
soap from the community
base load feed for the mine.
soap factories previously
above and beyond in its commitments to the local
established by Hummingbird
“We’re hitting mineralisation
and supplying the local
where we were expecting and
communities to help combat
are also targeting some new
COVID-19 with greater
deposits. Nobody has done any
handwashing and hygiene.
communities in Mali, bringing
greenfields exploration here for seven or eight years, and
in additional public health
“We also continue to supply
we’ve had a couple of good hits
education initiatives while
medical equipment and are
in the early drill holes. It’s a bit
continuing to support existing
in the process of buying some
early to say but I’m optimistic
programmes, including the
testing equipment with the
we will come up with more
hugely successful market
support of the government of
good results,” Betts concludes.
garden and water projects.
Mali.”
“We have put a huge amount of
At the start of the year,
effort into driving community
Hummingbird earmarked
Published by Anderson Murray Media Ltd
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