TIDMHUM
RNS Number : 0950V
Hummingbird Resources PLC
19 July 2018
Hummingbird Resources plc / Ticker: HUM / Index: AIM / Sector:
Mining
Hummingbird Resources plc
("Hummingbird" or the "Company")
Q2 2018 Production Results and Operational Update
Yanfolila delivering results
Hummingbird Resources (AIM:HUM), the African gold producer, is
pleased to announce its Q2 2018 production results for the quarter
ended 30 June 2018, which represents its first full quarter of
commercial production since the end of the ramp-up period at the
Yanfolila Gold Mine.
Yanfolila highlights at 30 June 2018
-- 33,101 ounces of gold poured at an AISC of US$790/oz
-- Average grade of 3.43 g/t
-- 38,726 ounces of gold sold at an average price of US$1,307 per ounce
-- 500,000 Lost Time Incident ('LTI') free hours achieved during the quarter
-- Exploration drilling campaign targeting conversion of
Resources to Reserves commenced at the end of Q2
Corporate highlights at 30 June 2018
-- Cash of US$46.2m
-- Net debt of US$15.6m
Dan Betts, CEO of Hummingbird, commented:
"Hummingbird's second quarter of production has been a
successful one. It's been our first full quarter of commercial
production at Yanfolila and we have delivered on forecast with high
grades and strong recoveries coming through the plant. The team is
running the mine exceptionally well and it is pleasing to see our
successful emergence as a commercial gold producer. Our next focus
is to prove that we can extend the mine life of Yanfolila by
converting Resources to Reserves through the Group's exploration
campaign, which is underway.
I am also extremely pleased to report an improving safety record
at site. This is an integral focus for the Company as we look to
not only operate a highly profitable mine but a safe one where all
staff and contractors are working to best practice."
The Company has recently produced an updated corporate video,
which is available to view on the website here:
http://hummingbirdresources.co.uk/corporatevideo2018
Conference Call
Hummingbird Resources will be hosting an analyst and investor
call today at 10:00am. Participants can dial-in with the following
details:
UK Toll Free Number: 0800 358 9473
UK Toll Number: +44 3333 000 804
PIN: 64891530#
Yanfolila Gold Mine
Q2 2018 Q1 2018*
Gold Poured (Ounces) 33,101 18,785
------------------- --------------------
Ore mined (Tonnes) 282,153 295,228
------------------- --------------------
Ore processed (Tonnes) 287,605 238,628
------------------- --------------------
Avg grade mill feed
(g/t) 3.43 2.96
------------------- --------------------
Recovery (%) 95.17% 96.10%
------------------- --------------------
Gold Sales (Ounces) 38,726 11,941
------------------- --------------------
AISC (US$/oz) 790 -
------------------- --------------------
Average gold sale price
(US$/oz) 1,307 1,332
------------------- --------------------
*Ramp-up quarter
Yanfolila has delivered a solid quarter with 33,101 ounces of
gold poured and the processing plant performing strongly. The mine
is on track to achieve its 2018 production target of 105,000 -
115,000 ounces. A total of 38,726 ounces of gold has been sold at
an average price of US$1,307 per ounce. This figure is slightly
above the total gold poured for the quarter due to the timing of
shipments.
Process Plant
During Q2 2018, the plant met the design criteria and capacity.
The design feed rate to the plant was achieved and sustained in the
quarter. Gold recoveries from the CIL circuit have been excellent,
with recoveries exceeding the design figure of 93%, consistently at
over 95%.
While the plant was fed predominately oxide ore, the entire
process circuit, including the secondary crusher, operated
efficiently. The performance test of the plant was completed
successfully.
The Company has hired and trained plant operators from local
villages, which is in line with one of its objectives to provide
local employment. The success of this can be seen in the
consistently strong performance of the plant and we will continue
to ensure that community development is prioritised.
Mining
Komana East ('KE')
Mining Operations throughout the quarter focussed on phase 1 and
phase 2 of the KE pit. The KE southern section was mined down to
the 340RL and is grade controlled down to RL330. Work has also
commenced at the KE northern section, which has given the Company
the opportunity to deliver a better blend of oxides and
transitional material to the processing plant, mitigating the
potential impact of the wet season approaching, which has in turn
resulted in higher production rates. Good grade reconciliation
results were achieved from the southern end of the pit, which
allowed for higher-grade ore delivery to the ROM pad.
Komana West ('KW')
Mining, de-bushing and topsoil removal commenced during the
month of June and extensive progress was recorded during the
period. Waste dump clearance for stage 1 is completed and mining is
taking place on the RL 395 bench. Grade control drilling was
completed on the RL 400 and RL 395 to a depth of 10m.
Focus and emphasis was placed on shovel optimisation and
increased utilisation over the entire suite of equipment in order
to build an optimal ore stockpile. This has allowed a greater
blending capability for the processing plant in terms of the type
of material and grade delivered.
Safety
Hummingbird's safety record continued to improve with the Group
having passed 500,000 LTI free hours in the quarter. The Lost Time
Frequency Rate ('LTIFR') is shown in table below.
Measure Q1 2018 Q2 2018
3 month average LTIFR 1.65 0
-------- --------
Project average LTIFR 3.44 2.68
-------- --------
All safety frequency rates are reported per 1,000,000 hours
Community
Projects supported in the quarter include the construction of a
new community health centre in Bougoudale village, which comprised
of construction of the main building, a pharmacy, maternity unit,
borehole, water supply system and accommodation. The construction
of the health centre will be completed in July 2018 and will be
followed by an intensive training and a mentoring programme taking
effect in H2 2018. The finished project will benefit over 5,000
people.
Hummingbird also invested in training of 25 people from the
local area in skills such as welding in Bamako, in collaboration
with Malian NGO Nege Blon. Work placements are due to follow in Q3
2018, showing the Groups commitment towards supporting a local work
force.
Other community work carried out in the quarter includes the
construction of two new market gardens, each measuring 2 hectares,
where 100 women will benefit; a training and monitoring programme
provided through a partnership with Swisscontact; a new borehole
and solar-powered water distribution system; the development of
four poultry projects with the capacity to benefit 50 youth
beneficiaries with training and monitoring provided through a
partnership with Swisscontact.
The Group's existing water supply initiatives have continued to
plan, with new boreholes equipped with pumps and solar panels
constructed in four villages and distribution networks installed to
communal taps. The estimated total number of beneficiaries of these
projects amounts to over 5,000 people across four villages.
Initiatives such as these have seen Hummingbird be successfully
aligned with the local communities, making the security incident of
the 29 May 2018 an isolated occurrence.
Dugbe Gold Project - MDA Update
Hummingbird is pleased that its Mineral Development Agreement
('MDA') was passed through the Senate and the House of
Representatives, and is now going through the final phase of
approval from the Liberian President. The MDA will provide the
long-term, 25 year framework for future mine development at the
Dugbe Gold Project.
Dugbe is Liberia's largest gold deposit with 4.2Moz of gold in
Resources and the Company has an additional +2,000km(2) of highly
prospective ground under licence in the country.
Update on cancellation of the Company's share premium account
('Cancellation')
As previously announced, the Cancellation would have the effect
of creating additional distributable reserves, which would be used
to eliminate any accumulated deficit on the Company's profit and
loss account. Such distributable reserves may be used in the future
for the purpose of making market purchases of the Company's own
shares.
The Cancellation is now conditional upon the approval of the
Court. This process is ongoing and it is anticipated that it will
continue during H2 2018. Further updates will be given when
progress is made.
Business Development
Hummingbird's project development team, having successfully
commissioned and ramped up Yanfolila on time and budget, are now
reviewing ways to optimise Dugbe before further work is completed
on technical studies. It is anticipated additional drilling will be
required at Dugbe in order to increase the competency of the
Resources as part of a Definitive Feasibility Study. There is also
significant scope to target Resource increases with both Tuzon and
Dugbe F deposits being open at depth and on strike and with other
under explored nearby targets.
As well as optimisation work being carried out at Dugbe the
Company is also reviewing additional capital investment programmes
into Yanfolila that would potentially have the ability to increase
the plant's capacity. These potential investments, in conjunction
with the ongoing exploration programme, could have significant
benefits in transforming Yanfolila into a larger and longer life
mine. Further updates will be given once the cost-benefit analysis
on these potential programmes has been carried out.
Additionally, the Company has made a US$1.5m arm's-length
investment (which may be increased to US$2m), in the form of an
interest bearing convertible loan, to Bunker Hill Mining Corp.
('Bunker Hill'), a Canadian listed exploration and development
Company. Bunker Hill is committed to re-starting the fully
permitted Bunker Hill mine, in Idaho, USA, with historic SEC
compliant Reserves and Resources of 9.1M Tonnes of Zinc @ 5.08% and
Lead @ 2.35%. The Company is currently conducting ongoing due
diligence on the asset.
**ENDS**
For further information, please visit
www.hummingbirdresources.co.uk or contact:
Daniel Betts, Hummingbird Resources plc Tel: +44 (0) 20 7409
CEO 6660
Thomas Hill,
FD
Robert Monro,
IR
James Spinney Strand Hanson Limited Tel: +44 (0) 20 7409
Ritchie Balmer 3494
James Bellman Nominated Adviser
-------------------------- ----------------------
Martin Davison Canaccord Genuity Limited Tel: +44 (0) 20 7523
James Asensio Broker 8000
-------------------------- ----------------------
Gordon Poole Camarco Tel: +44 (0) 20 3 757
Owen Roberts 4980
James Crothers Financial PR/IR
-------------------------- ----------------------
About Hummingbird Resources Plc
Notes to Editors
Hummingbird Resources (AIM: HUM) is a leading gold production,
development and exploration company. The Company has two core gold
projects, the Yanfolila Gold Mine in Mali and the Dugbe Gold
Project in Liberia.
Yanfolila produced its first gold pour on time and budget in
December 2017 and is expected to produce approximately 107,000oz
gold/year on average over the Life of Mine. Yanfolila holds
pre-production Probable Reserves of 709,800oz @ 3.14g/t, total
Resources of 1.8Moz of gold and an additional 390,700oz of
non-compliant exploration potential.
The Dugbe Gold Project has Resources currently totalling 4.2Moz
of gold and a completed NI 43-101 compliant PEA on the project
showing a 29% IRR and US$186m NPV at a US$1,300 gold price.
In addition to Hummingbird's production and development assets,
the Company also has an exploration footprint of 4,000km(2) and a
34% interest in AIM listed Cora Gold, which is advancing a
portfolio of prospects in Mali and Senegal.
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.
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END
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