JOHANNESBURG (miningweekly.com) – West African gold exploration and development company Hummingbird Resources has secured combined funding of $8.9-million through a share placing and share subscription agreement.

The company had placed units with existing and new institutional investors to raise about $3.9-million. Each placing unit comprised one new ordinary share of 1p each in the capital of the company and one-half of a warrant to subscribe for new ordinary shares.

Hummingbird also entered into a binding agreement through which BCM International would subscribe for up to $5-million, fixed at $1.48 apiece, of new ordinary shares once definitive project contracts were in place.

In addition, to allow existing shareholders to participate, the company intended to conduct an open offer to shareholders of up to 6.7-million new ordinary shares at the issue price, each also offered with half a warrant, to raise up to $3-million.

The first tranche of the placing would be of 3.6-million placing units, while the second tranche would be of 4.9-million units and remain conditional on the approval of new shareholder authorities.

Hummingbird said in a statement on Friday that the proceeds would be used in conjunction with the proposed $75-million Taurus Funds Management facility to bring its Yanfolila gold operation, in Mali, into production in the first half of next year.

“This funding solution, in tandem with our proposed Taurus debt facility, will see us funded to start construction at Yanfolila. We aim to deliver our maiden gold pour at Yanfolila in 2016,” commented CEO Dan Betts.

He added that the results of the recent optimisation study at Yanfolila highlighted a low-cost, low technical risk and quick route to gold production.

“The study shows a project that will deliver 100 000 oz of gold production in its first year, with 79 000 oz/y production over its mine life at an all-in cash cost of $733/oz.

“With the focus predominantly on oxide ore, which recently increased to 650 000 oz, we can create a high-margin, high-return operation. Additionally, there are multiple options to improve the project economics significantly and, importantly, we have the team with the operational experience to achieve this,” noted Betts.

The 4.2-million-ounce Dugbe project, in Liberia, meanwhile, remained integral to the company as it continued to do work to improve the existing technical studies.