Name of the Project
Yanfolila gold project.

Location
The project comprises two main clusters of ore deposits: Komana East (KE), Komana West (KW), Guirin West (GW) and Gonka (GK), in the south; and Sanioumale East (SE) and Sanioumale West (SW), in the north of Mali.

Client
Hummingbird Resources.

Project Description
Hummingbird has completed an optimised mine schedule, which has improved the Joint Ore Reserves Committee-compliant ore reserve statement and updated economic sensitivities based on the new reserve and mine schedule for the Yanfolila gold project.

The project’s reserves have increased from 6.82-million tonnes at a grade of 3.03 g/t of gold in the January 2016 definitive feasibility study (DFS) to 7.04-million tonnes at a grade of 3.14 g/t of gold in the optimised mine schedule.

The DFS financial model has been updated to incorporate the increased ore reserve and new mine schedule, with a resulting improvement in project economics. The project will be developed as an openpit, low-cost gold- mining operation.

The DFS life-of-mine (LoM) plan envisages the progressive mining of five openpits, starting initially with KE and KW, and then progressing to GW, SE and SW.

Hummingbird is also considering developing the high-grade Gonka resource, initially as an openpit and then as an underground mine.

The plant will have a throughput of 1.24-million tonnes a year, producing up to 107 000 oz/y of gold.

The ore is nonrefractory and the simple process plant design uses gravity and carbon-in-leach (CIL) for the processing and recovery of the gold, which averages 92.5% over the LoM.

Jobs to be Created
Not stated.

Net Present Value/Internal Rate of Return
The project’s net present value (NPV) has increased from $88-million, at an 8% discount rate in the 2016 DFS, to an NPV, at an 8% discount rate, of $162-million.

The project’s internal rate of return has increased from 37% in the DFS to 60% in the optimised mine schedule.

Value
The project’s estimated capital expenditure has remained at $79.36-million  from the DFS to the optimised mine schedule.

Duration
Initial gold pour is targeted for the end of 2017.

Latest Developments
Hummingbird has entered into a mandate letter with Taurus Funds Management and secured an extension to the bridge loan facility to develop its Yanfolila gold project.

Through the facility, Hummingbird will receive a $55-million mandate, comprising a four-year $45-million senior secured term facility and a $10-million cost overrun facility.

Interest will be charged at a rate of 7.75% on the senior secured loan from project completion, which includes the passing of a number of economic and mechanical tests associated with being in commercial production, and the establishment of a debt service reserve account.

Hummingbird CEO Dan Betts has noted that, following successful equity raisings totalling $71-million earlier this year, construction at the project is now well under way, with more than 20% of the capital expenditure committed.  

“With the significantly lower debt gearing on the project, we are happy that it now satisfies Taurus’s requirements.  Taurus has completed all technical due diligence, and the extension of the bridge facility by a further $10-million is representative of the commitment to Yanfolila,” Betts has said.

Importantly, there are no significant conditions required to refinance the bridge facility into the first draw of the term facility.

The senior secured facility will be repaid through five semi-annual repayments starting September 30, 2018.  Repayments will be the higher of an agreed amortisation profile, or 40% of free cash flow after paying interest.

Key Contracts and Suppliers
DRA Projects (DFS); CSA Global (mineral resource and ore reserves reports); Senet (metallurgical testwork, process design and engineering, and capital and operating cost estimates for the processing plant and the associated plant infrastructure); Schlumberger Water Services (hydrology and hydrogeological studies); and Ausenco Engineering Canada (design and cost estimates for the tailings storage facility); Afromix (agitators); Delkor (linear screens); Kemix (regeneration kiln and interstage screens); Metso (primary and secondary crushers, screens and feeders).

On Budget and on Time?
The company remains on time and within budget, having committed to $12-million to date.

Contact Details for Project Information
Hummingbird Resources, tel +44 20 3416 3560.
DRA Projects, tel +27 11 202 8600 or email info@DRAglobal.com.
CSA Global, tel +27 11 568 2724, fax +27 11 676 6689 or email csasouthafrica@csaglobal.com.
Senet, tel +27 11 409 1300 or fax +27 11 409 1301.
Schlumberger Water Services, tel +27 11 6841122 or fax +2786 576 6034.
Ausenco Engineering Canada, tel +27 11 258 8591.