Hummingbird Resources Plc (LSE:HUM) is an AIM listed exploration, development and production company with gold mining operations in Mali and Liberia.
Hummingbird Resources was admitted to AIM in December 2010 when it raised £25.5 million in gross proceeds by placing 15.256 million new ordinary shares at a share price of 167 pence each. Following the placing, the market capitalisation of the company was £89.1 million.
In August 2023, Hummingbird had c. 602 million shares in issue and the HUM share price was 11 pence giving a market cap of £66 million.
Overview of the company’s assets
The key assets owned by the company are:
1. Yanfolila gold mine
Yanfolila produced its first gold pour in December 2017. In December 2019, an updated JORC compliant reserves statement advised that Yanfolila contained 7.9 million tonnes (Mt) of ore with an estimated proved and probable reserve resource of 676k oz of gold at a cut-off of 2.66 g/t.
The five-year rolling Mine Plan (2020 to 2024) released in February 2020 forecasts total gold production of 574,000 ounces gold over that period at an expected All-in Sustaining Cost (AISC) of between US$ 850 and US$ 895 per ounce.
2. Dugbe gold project
A Preliminary Economic Assessment (PEA) carried out on Dugbe indicates that the mine contains 4.2 million ounces of gold, has a project net present value (NPV) of US$ 337 million (assuming a gold price of US$ 1,500 per oz) and is expected to generate an IRR of 43%.
In May 2019, Hummingbird Resources signed a 25-year renewable Mineral Development Agreement (MDA) with the Government of Liberia. Under the terms of the MDA, Hummingbird granted a free 10% carried shareholding to the Government, agreed a signing fee of US$ 1.5 million, a 3% royalty and an income tax rate of 25%.
In June 2020, HUM entered into a two-year earn-in agreement with ARX Resources (a related party company, in which three Hummingbird directors owned 39%). The agreement entitled ARX to earn up to a 49% interest in Dugbe (net of the Government’s share) in exchange for the payment of a non-refundable deposit of US$ 2 million to Hummingbird plus an undertaking to spend a further US$ 8 million funding the project overheads and completing a Definitive Feasibility Study.
In September, Pasafino Gold, a Canadian mineral exploration company, completed the acquisition of ARX and announced that they had concluded an equity fundraise of C$ 10.020 million which would be invested in the Dugbe project.
In November, Pasafino announced the acquisition of the “Central Licence” within the project, an area of 210km2 with “exceptional prospectivity”.
3. Kouroussa gold project
100% ownership of the Kouroussa Gold Project which is located in the highly prospective Siguiri Basin, Guinea. First gold production is expected before June 2022, with annual production of 100k ounces gold over an initial five-year Life of Mine. Capital expenditure required to develop the mine is estimated at US$ 90 million and the project has an AISC of US$ 800 per ounce. There is Letter of Intent in place to provide up to US$ 100 million development finance.
4. Cora Gold Limited
As at 12th October 2020, Hummingbird owned a 11.36% stake in Cora Gold Limited, an AIM listed gold mining company valued at c. £18 million in November 2020.
5. Bunker Hill Mining Corporation
In October 2020, Hummingbird agreed to settle its outstanding US$2.1 million convertible loan by converting the loan into common shares of Bunker Hill.
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