TIDMHUM
RNS Number : 2143H
Hummingbird Resources PLC
02 December 2020
Hummingbird Resources plc / Ticker: HUM / Index: AIM / Sector:
Mining
2 December 2020
Hummingbird Resources plc
("Hummingbird" or the "Company")
Operational update
Hummingbird Resources plc (AIM:HUM) provides an operational
update to the market following a senior management site visit to
the Yanfolila mine last week.
To view the RNS with illustrative maps please use this link:
http://www.rns-pdf.londonstockexchange.com/rns/2143H_1-2020-12-2.pdf
Key operational updates:
-- Site visit focus: The main focus was to spend time with
senior site management, review Hummingbird's current and future
mine plans, review the 2021 budget process, run through the mine
operations, plant, facilities and overall processes in place and
visit several of its community projects
-- Management: Reviewing managerial changes made last quarter to
improve group operational performance, reporting lines and
efficiencies. The review of managerial roles and accountabilities
is ongoing, however the Company is confident that tangible
improvements have been made and will continue to be made under the
recently internally promoted General Manager (" GM"), Edrich
Welthagen
-- 2021 Budget: Review of Hummingbird's initial draft 2021
budget was conducted, which the Company expect to finalise in the
coming weeks
-- Production: After a thorough review with the new leadership
team on site and following two challenging quarters, it has become
clear that the cumulative headwinds that the Company has faced this
year means there is now a material risk of producing below its 2020
production guidance of 110,000 - 125,000oz. Total ounces poured
year to date as at the end of November were approximately 93,000oz.
Key reasons include:
-- As previously discussed in the second quarter of 2020,
Hummingbird re-sequenced certain parts of the mine plan in order to
access and process a greater proportion of softer oxide material.
This was done to preserve wear and tear on critical parts in the
plant during the unprecedented and unspecified border closures due
to the Covid-19 pandemic. This strategy was successful in
preserving the plant and on-going production
-- In the third quarter of 2020, the mine endured extreme
weather events with the wettest rainy season on record. This led to
the continued mining of oxides and waste that were of lower grade
than the Company's initial start-of-year plans, resulting in lower
production for that quarter. This was particularly the case from
the Komana East ("KE") mining pit (see maps below)
-- Further, as the rainy season ended, a military coup in Mali
enforced an additional border closure for approximately a month to
compound the already complicated Covid-19 induced logistical
complications the Company had faced, and which remain ongoing
-- Despite now being in the dry season and mining higher grade
ore this quarter, it has now become clear that there is a material
risk, as a result of the abovementioned factors, that the Company
will not meet the lower end of 2020 production guidance of 110,000
- 125,000oz
-- It is important to note that ounces not produced this year
are expected to be recovered in future mining periods. This is
demonstrated in the attached diagrams of the key producing pit, KE,
showing where the high grade ore remains at a depth below the
current pit floor which was due to be mined in the original 2020
mine plan. This ore remains available and is currently being
mined
Up-coming news flow highlights:
-- Drilling: A final drilling programme is being carried out at
the Sanioumale East ("SE") deposit. Results to be released before
year-end to complete Hummingbird's, to date, successful 2020
exploration and drilling campaign
-- Kouroussa gold project, Guinea: Pre-development plans are
continuing. The Company is awaiting the award of the mining license
by the government to then move into the development stage of this
exciting gold project once pre-development plans are complete
-- Mineral resource model update: Once drilling at SE is
finalised, Hummingbird will update the Yanfolila mineral resource
models and aim to release those findings in Q1 2021
-- 2021 budget: The Company's 2021 budget is expected to be
finalised in the coming weeks, with the aim to release in Q1 2021,
including key findings and forecast estimates
Dan Betts, CEO of Hummingbird, commented:
"2020 has been a difficult and frustrating year. The harsh
reality is that should we fail to meet guidance, no matter what the
circumstances, it will be viewed as such and this is a fact that
weighs heavily on the team. That said, I remain extremely proud of
our people on the ground and all that they have overcome this year
in challenging times. I do believe that Yanfolila, which will have
paid off all its debt in the first half of next year, is well set
up to deliver solid production for the years to come. Our
exploration programme this year has produced many encouraging
results which we are confident will contribute to additional
resources being included into the mine plan to extend mine
life.
"On other matters, our pre-development plans at our new mine,
Kouroussa, in Guinea continue and we are confident the mining
license will be awarded soon. We will then move towards the
development stage following completion of the pre-development plans
of this exciting project, which will see us become a multi-asset
producer in the coming years producing in excess of 200koz pa.
Becoming a multi-asset producer is key not only for the Company's
growth but also to mitigate single mine risks factors as
demonstrated this year at Yanfolila. Further, we are finalising our
2020 exploration and drilling campaigns and look forward to
releasing those updated results when finalised soon, followed by
our updated mineral resource models in the new year."
Community projects update:
-- The Company met and listened to the senior leaders of the 10
communities in its mining catchment area and visited several of the
local community projects which the Company supports
-- The key focus in the last months has been to repair and
better maintain the Company built infrastructure in the villages
such as improvements to water towers, hospital clinics, and market
garden infrastructure
-- Discussions surrounding the communities' needs and wants for
next year revolved around the existing projects, training, health
and reforestation programmes
-- As part of the 2021 budgeting review, Hummingbird aim to
update its community project plans in the new year
KE 1 PIT CROSS SECTION VIEW
KE 2 PIT CROSS SECTION VIEW
YANFOLILA MINERAL RESOURCES MAP
KOMANA EAST PIT - 3D SCHEMATIC
KOMANA WEST PIT - 3D SCHEMATIC
The information contained within this announcement is deemed by
the Company to constitute inside information stipulated under the
Market Abuse Regulation (EU) No. 596/2014. Upon the publication of
this announcement via the Regulatory Information Service, this
inside information is now considered to be in the public
domain.
**S**
For further information please visit
www.hummingbirdresources.co.uk or contact:
Daniel Betts, Hummingbird Resources Tel: +44 (0) 20 7409
CEO plc 6660
Thomas Hill, FD
Edward Montgomery,
CSO & ESG
James Spinney Strand Hanson Limited Tel: +44 (0) 20 7409
Ritchie Balmer Nominated Adviser 3494
-------------------------- ---------------------
James Asensio Canaccord Genuity Limited Tel: +44 (0) 20 7523
Thomas Diehl Broker 8000
-------------------------- ---------------------
Tim Blythe Blytheweigh Tel: +44 (0) 20 7138
Megan Ray Financial PR/IR 3205
Rachael Brooks
-------------------------- ---------------------
Notes to Editors:
Hummingbird Resources (AIM: HUM) is a leading multi-asset,
multi-jurisdiction gold production, development and exploration
company and member of the World Gold Council ('WGC'). Our vision is
to continue to grow our asset base, producing highly profitable
ounces, while central to all we do being our Environmental, Social
& Governance ('ESG') policies and practices. The Company
currently has two core gold projects, the Yanfolila Gold Mine in
Mali, and the recently acquired Kouroussa Gold Project in Guinea.
Further, the company has a controlling interest in the Dugbe Gold
Project in Liberia that is being developed by Pasofino Gold Limited
through an earn-in agreement. Construction of the Yanfolila mine,
was on time and on budget in December 2017 having produced to date
in excess of 270 kozs (as end of July 2020). Mineable Reserves, as
at 31 October 2019 Yanfolila were 7.9Mt of Reserve ore @ 2.66 g/t
for 676,000ozs gold. At 31 March 2019 Yanfolila had a total
Resource base (inclusive of Reserves) of 28Mt of Ore @ 2.23 g/t for
2,005,300ozs gold. The Kouroussa Gold Project has a Mineral
Resource base of 1.18Moz @ 3.08 g/t, which we are working on to be
fast tracked to production, adding an additional c.100,000 oz of
gold per annum to the Company's production profile. 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 43% IRR
and US$337m NPV at a US$1,500 gold price.
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