Appoints SENET & Project Manager for Construction

RNS Number : 3372D

Hummingbird Resources PLC

06 July 2016

 

Hummingbird Resources plc / Ticker: HUM / Index: AIM / Sector: Mining

6 July 2016

Hummingbird Resources plc ("Hummingbird" or the "Company")

 Appoints SENET & Project Manager for Yanfolila Gold Mine Construction

Hummingbird Resources plc (AIM: HUM), the West African gold company, is pleased to announce it has awarded the Engineering, Procurement and Construction Management ("EPCM") contract for its Yanfolila Gold Project in Mali ("Yanfolila") to SENET (Pty) Ltd, a leading South African project management and engineering company.  SENET will carry out detailed engineering and manage the mine construction at the 1.24 Mtpa gold project, for which the Company recently closed a US$71 million fundraise, ahead of anticipated production by the end of 2017.

Overview

·     SENET appointed as EPCM engineer to build the Yanfolila plant and associated infrastructure

·     SENET has commenced detailed engineering as of 1 July 2016

·     Procurement has commenced on long lead items;

o  Ball Mill

o  Tower Crane

o  CIL tanks

·     Mr. Wayne Galea appointed as Yanfolila Project Manager to work with Shaun Bunn, Technical Director

o Wayne has 31 years' experience in design, construction, commissioning and operating mines

o Process engineer who has spent most of his career with both EPCM engineering companies and client companies delivering projects with significant recent African experience

·     Appointment follows successful fundraise of US$71 million to commence full scale construction of Yanfolila, which offers:

o  132,000oz gold in first full year of production with LoM average production of 107,000oz pa

o  IRR of 60% and an NPV of US$162 million at US$1,250 gold price (IRR of 72% at US$1,350 gold price)

o  Over US$70m of free cash flow in first year full production at US$1,250 gold price (US$85m free cash flow at US$1,350 gold price)

o  AISC of US$695/oz - which is expected to be in the lowest quartile of African producers

o Significant upside from over 1Moz of gold inventory outside of the current mine plan within the mining permit

Dan Betts, Managing Director of Hummingbird Resources, said: 

"With SENET contracted for Yanfolila's mine construction, detailed engineering has now commenced.  We have been working with SENET for two years through the optimisation of the Project and delivery of the DFS and we look forward to building a mine with them.  SENET were previously involved with Yanfolila when it was owned by Gold Fields so their knowledge of the Project is second to none.  Coupled with their long and impressive history of delivering quality projects in Africa, this gives us all great confidence. 

"I am also extremely pleased to welcome Wayne Galea to the Hummingbird team as project manager.  He is a key hire for project delivery and brings a wealth of experience to the role that we are already benefiting from."

Project Manager

Wayne Galea is a mining professional with 31 years' experience in the mining industry specialising in gold.  A process engineer by background, he has worked for a number of the world's leading engineering companies including AMEC, Bateman and Signet, where he has extensive experience of managing EPCM contracts.   He has also worked directly for gold mining companies such KBK Gold where he was instrumental in their project execution.  Wayne's career has led him to have experience of working in Africa, Asia and Australasia with a focus on process engineering, and he brings significant technical and project execution skills to the Hummingbird team. 

The role directly manages SENET and other contractors in the successful delivery of the Project.  Shaun Bunn, Technical Director, has overall oversight of the Project delivery.  Shaun has in excess of 30 years' experience in the mining sector, managing projects through all stages of development and in production. 

About SENET (Pty) Ltd

SENET is one of the leading project management and engineering firms in the field of mineral processing. For more than two decades, SENET has provided project management, detailed multidiscipline engineering, procurement, logistics management, and construction services to the mining, mineral processing, infrastructure and materials handling industries. 

SENET worked on both the Loulo (Mali) and Tongon (Côte d'lvoire) Mines for Randgold Resources and has more recently been involved in the execution of True Gold's Karma project in Burkina Faso. Apart from these prestigious projects SENET has also been involved in a large number of other West and Central African gold projects.

SENET has an array of technical specialists and consultants with specialised knowledge across the full spectrum of process plant and materials handling systems design. Consequently, SENET has successfully designed and supplied processing plants and materials handling systems across the globe.  Founded in 1989, SENET has its offices in Johannesburg, South Africa and currently employs over 300 people.  SENET's pro-active management approach, combined with a modest overhead structure, has allowed it to efficiently execute medium and large-sized projects across the globe.

SENET has extensive project and construction experience in remote countries throughout Africa, as well as in the Middle East, Asia, and Central and South America. This global experience has provided SENET with the necessary expertise and skills to deal with cross-border logistics, freighting and the construction activities required to successfully execute projects in countries with very limited infrastructure.

This announcement contains inside information for the purposes of Article 7 of Regulation 596/2014.

**ENDS**

For further information please visit the Hummingbird website www.hummingbirdresources.co.uk or contact:

Daniel Betts Thomas Hill Robert Monro	Hummingbird Resources plc	Tel: [phone]
Charlie Cryer Stefan Murphy Jonathan Stephens Oliver Morse	RFC Ambrian Ltd Nominated Adviser and Joint Broker	Tel: [phone]
Jon Belliss	Beaufort Securities Limited Joint Broker	Tel: [phone]
Lottie Brocklehurst Susie Geliher Hugo de Salis	St Brides Partners Ltd Financial PR/IR	Tel: [phone]

About Hummingbird Resources Plc

Hummingbird Resources (AIM: HUM) is building a leading gold production, development and exploration company.  The Company has two core gold projects, the near-term production Yanfolila Gold Project in Mali and the Dugbe Gold Project in Liberia.  Its current focus is on bringing Yanfolila into production, which has a Probable Reserve of 709,800oz @ 3.14g/t and total Resources of 1.8Moz of gold and an additional 390,700oz of non-compliant exploration potential.  The high grade gold project has the potential to turn a profit in a varying gold price environment and will allow for quick returns with low operating costs. 

The 4.2Moz Dugbe Gold Project in Liberia provides Hummingbird with excellent development upside.  An optimisation of the DFS is on-going whilst Yanfolila is brought to production in the near-term.  Additionally, the Company has 4,000km² highly prospective exploration ground in Mali and Liberia and is constantly evaluating new quality assets.

 

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