28th May 2019 10:57
LONDON (Alliance News) - Hummingbird Resources PLC is to review its Yanfolila life-of-mine estimates, it said Tuesday, while also warning on 2019 costs.
Gold miner Hummingbird is currently updating its reserves and resources for the mine, in Mali, with this due to be finished by the end of the second quarter.
A second ball mill is being installed at Yanfolila, which will increase throughput. Alongside the reserve and resource changes, Hummingbird is as a result updating the life-of-mine for Yanfolila.
The last forecast was made in 2016, showing the mine would average 107,000 ounces of gold a year. However, in the three years to 2022, this could rise to 130,000 to 145,000 ounces a year, at an all-in sustaining cost of USD800 an ounce.
From 2023, the average annual production rate from reserves would drop to 80,000 ounces a year, according to the 2016 forecast.
Hummingbird also is to soon announce results of a scoping study on the Gonka deposit and on underground mining at Komana East, both part of the Yanfolila project. This could lead to further increased reserves, boosting annual production in future and the life-of-mine. Hummingbird currently sees over 1 million ounces of gold sitting outside of the current reserves of Gonka and Komana East.
Turning to 2019, as a result of a previously announced weaker first quarter, Hummingbird is likely to miss its USD800 to USD850 per ounce all-in sustaining cost target for the year.
In April, Hummingbird said problems in the both the Komana East and West pits led to a fall in the mining rate, though production did rise quarter-on-quarter.
Hummingbird also released 2018 results on Tuesday, its first year as a producing miner.
Revenue was USD116.5 million, from none the year before, though its pretax loss still widened to USD11.7 million from USD5.3 million in 2017, mainly due to higher finance costs and an impairment.
Hummingbird produced 91,620 ounces of gold from Yanfolila in 2018, having guided for between 87,000 ounces and 92,000 ounces.
"2018 proved to be a period dominated by key milestones and operational challenges. After pouring first gold to plan in December 2017, the Yanfolila gold mine successfully ramped up to full-scale production in first quarter 2018, displaying both the operational efficiency of the mine and positive cash flows for the subsequent quarters," said Chief Executive Dan Betts.
"As much as we can take assurance from past achievements, our focus now turns to the future growth of Hummingbird and the maintenance of the progress achieved so far to ensure stable production."
Hummingbird shares were down 2.5% at 14.50 pence on Tuesday in London.
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