Multi-asset gold company Hummingbird Resources is developing the advanced Yanfolila gold project, in Mali, as a low-cost, high-grade openpit mining operation, with first gold production targeted for December.
“Based on the current mine life, Yanfolila has a $162- million net present value (NPV) at a $1 250/oz gold price, including an 8% discount rate. We have more than one-million ounces of gold outside the mine plan to extend the mine life when in production as well as to increase the NPV, which is based on a 7.5-year mine life,” explains Hummingbird business development head Bert Monro.
He further adds that the gold project aims to mine 110 000 oz/y of gold over the life-of-mine (LoM) at an all-in cost of $695/oz, creating up to 900 jobs during the construction phase, which is under way, and 800 jobs during the production phase.
“The overall investment to bring the project into production will be around $88-million,” he notes, adding that the project is fully funded following a new equity funding of $75-million, which was completed in 2016.
Hummingbird also recently agreed on a $60-million loan with financial institution Coris Bank International – which, in part, paid back a $25-million bridge loan facility with financial solutions provider Taurus Funds Management.
Coris, Hummingbird notes, is a major player in the African marketplace and will be an influential partner capable of helping Hummingbird grow.
An optimisation study for the Yanfolila project was completed in March 2015, following the completion of initial earthworks in September 2015. The definitive feasibility study (DFS) was completed in January 2016.
The DFS was compiled by engineering consultant DRA Projects, with contributions from mining industry consultants CSA Global for the reserves and resources estimates; and engineering consultant Senet for the metallurgical testwork, process design and engineering, the capital and operating cost estimates for the processing plant and the associated plant infrastructure.
Senet has been retained to serve as the project manager and the engineering, procurement, construction and management contractor.
The Yanfolila project involves the development of five openpits – Komana East and Komana West in the first phase, and Guirin West, Sanioumale East and Sanioumale West in the second phase.
“The mining method envisaged for the project is the openpit method using conventional drill and blast, load and haul operations.”
The project is located within the Yanfolila greenstone belt on the eastern boundary of the greater Siguiri basin, which forms part of the Birimian volcano-sedimentary series of the West African Craton. The belt hosts a number of subbasins, including the Komana Mafic subbasin (KMSB) and the Kabaya subbasin.
The Yanfolila gold project is 80% owned by Hummingbird, which acquired it from gold mining company Gold Fields in November 2014. The Mali government owns the remaining 20% and earns a 3% royalty from the project.
Dugbe DFS in the Works
Hummingbird is undertaking a DFS at its Liberia-based Dugbe gold project – of which it owns 80% and the Liberian government 20%. The gold exploration project in the Dugbe shear zone crosses the company’s Dugbe and Joe Village licences.
Dugbe comprises three discoveries – Dugbe F, Tuzon and Sackor – with a defined resource of 4.2-million ounces of gold across the deposits. The DFS, Monro notes, is undergoing optimisation which includes bringing ore from Dugbe F into the first ten years of mine life.
Hummingbird is carrying out a DFS on Dugbe, owing to a positive preliminary economic assesment (PEA) carried out on the Dugbe F and Tuzon deposits. The Dugbe F deposit has a 1.76-million- ounce gold resource, while 2.6 km away, Tuzon has a 2.47-million-ounce gold resource. Sackor, a site of economic mineralisation discovered through a
3 727 m drill programme in 2012, does not have a defined resource as yet.
Hummingbird announced the results of the PEA on Dugbe in 2013 and the report concluded that the project remains robust from a technical and economic perspective, with a financial model over the 20-year LoM producing a post-tax NPV, at a 10% discount rate, of $337-million.
At a $1 300/oz gold price, Monro notes that the economics are still robust, with an internal rate of return of 29.4% and an NPV of $186-million.
Business management consultant MDM Engineering Group has been appointed to run the DFS and is being assisted by global mining industry consultant SRK Consulting as the resource consultant, while independent mining specialist Coffey Mining is tasked with geotechnical studies and engineering consultant Amec with the environmental and social-impact assessment.