Underperforming asset overshadows Hummingbird’s progress

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Progress in developing gold mining company Hummingbird Resources’ assets in Guinea and Liberia has been “overshadowed” by underperformance at its flagship Yanfolila gold mine in Mali, the company said in its update. fourth quarter 2021 operational data published on January 31. .

Yanfolila’s operations have underperformed since September 2021, which Hummingbird blamed on the mining contractor’s fleet of excavators not meeting contractual mining rates.

Additionally, reduced material movement has led to a lower grade profile, primarily due to access to lower grade sections of the orebody.

“While the operation was beset by a number of external challenges, the root cause for this performance was the underperformance of the contracted mining fleet on site and the delays in bringing in additional capacity,” he said. said Hummingbird’s CEO. Dan Betts.

He added that the company will pay particular attention to improving productivity and predictability at the Yanfolila mine, as several optimization and mitigation measures have already been put in place.

The first of these was the addition of five more excavators to the fleet, with the expectation that they will all be fully operational this quarter. Second, Hummingbird has bolstered its maintenance team of contract miners to improve the performance of the mining fleet.

Third, the company said it has implemented several other on-site operational workflows in an effort to improve production performance and predictability, as well as the plant’s quality power profile and the cost disciple of the department.

Along with better overall excavator fleet performance – which is underway with an additional fleet ordered and becoming operational – Hummingbird COO Anthony Kocken said the company is also optimizing the mine’s geological control and ore management, as well as implementing wet weather planning and mitigation measures.

He said Hummingbird was busy finalizing underground analysis to be incorporated into future mine plans, as well as implementing line management control improvements in each of the mine’s operational departments.

“We are confident that these and other measures will lead to an overall improvement in production, cost management and performance predictability at Yanfolila,” Köcken said.

Hummingbird reported that 18,181 ounces of gold were poured at Yanfolila in the fourth quarter, with annual production of 87,558 ounces, which is within the revised range of 84,000 to 89,000 ounces of gold.

OTHER ASSETS

Despite Yanfolila’s delay, Betts said construction of Hummingbird’s new Kouroussa mine in Guinea is accelerating and on schedule for first gold by the end of the second quarter of 2023. He said that this would cause the company to be more than – 200,000 oz gold producer.

In December 2021, the increased mobilization of equipment and personnel on site enabled construction, which started in early January. The civil engineering works were to start this quarter.

“[The] key contracts for power generation and mining are in advanced stages of discussion and finalization. Our primary focus for Kouroussa remains to maintain our diligent approach to timelines, investment management, positive community engagement, and an overall quality construction process,” Köcken said.

To finance the construction, Hummingbird said it drew the second of three available tranches from the financing facility provided by Coris Bank International in December.

Meanwhile, the ongoing feasibility study on the company’s Dugbe asset in Liberia is proceeding on schedule.

Betts added that the company’s reserves had increased, increasing the mine life at Yanfolila, including the first underground reserves and the first additional reserves at Kouroussa.

He said he expected that trend to continue when Hummingbird’s updated resource and reserve statement was released in the second quarter.

“Following the release of our first underground reserves at Yanfolila, we see significant potential in the Komana East Underground, which underpins Yanfolila’s future production profile, with higher grade ore for many years to come,” Betts said.

He noted that the company was finalizing the analysis of the optimal development path to then be incorporated into future mine plans.

“We are considering options to accelerate the development of the underground project to accelerate the delivery of higher grade ore,” he concluded.

The company’s production guidance for this year has been set at 87,000 oz to 97,000 oz of gold with an all-in sustaining cost range of $1,300/oz to $1,450/oz.

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