REG - Hamak Gold Limited - Results for the period ended 31 December 2023
30/04/2024 14:30
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RNS Number : 6564M Hamak Gold Limited 30 April 2024
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30 April 2024
Hamak Gold Limited
("Hamak Gold" the "Group" or the "Company")
Results for the period ended 31 December 2023
Availability of Annual Report
Hamak Gold Limited (LSE: HAMA) is pleased to announce its audited results for
the period ended 31 December 2023.
Copies of the Company's full Annual Report and Financial Statements for the
period ended 31 December 2023 will be made available on the Company's website
at www.hamakgold.com (http://www.hamakgold.com) .
Highlights
· In December 2022 the Company raised gross proceeds of £295,750
and in July 2023, a further £294,500 was raised to fund its ongoing working
capital and exploration costs related to the high-grade Ziatoyah gold
discovery which is located in the Nimba Licence in proximity to the Ity Gold
Mine in neighbouring Ivory Coast
· Exploration work included:
o Some 21-line kilometres of Induced Polarisation geophysical survey
completed over part of the extensive 3km gold in soil anomaly close to the
Ziatoyah gold discovery
o Structural interpretation and evaluation of geology around the Ziatoyah
prospect
o Several new priority drill targets selected based on geophysical anomalies
and structural targets
o Drilling completed over 13 geophysical and structural targets (1,000m)
with four holes showing mineralized gold intersections
o Independent detailed geological review on all exploration work and results
yielded to date at Nimba undertaken to prioritise the new drill targets and
define the next phases of exploration aimed at determining the extent of the
gold mineralization discovered at Ziatoyah along the strong 3km gold anomaly
Highlights Post Period
· £200,000 raised (before expenses) to progress the exploration
efforts at the Nimba Licence and for general working capital purposes
· A structured work programme, including surface mapping,
pitting/trenching and channel sampling is being established to advance the
next phase of work across several priority targets at Nimba, including
drilling of certain priority targets
Karl Smithson, Executive Director of Hamak Gold commented:
"In 2023, Hamak's team concentrated its efforts and resources on the
high-grade Ziatoyah gold discovery at our Nimba Licence. We have completed
geophysical surveys, mapping, sampling and drilling and have evolved the
geological model to target the continuation of the gold mineralization
discovered at Ziatoyah which is defined by a broad gold in soil anomaly,
extensive channel sampling mineralization and best drill intersections of 7g/t
over 20m, including 22g/t over 5m near surface.
"The next phases of work will include detailed mapping and further trenching
and channel sampling to help prioritise new drill targets aimed at
intersecting gold mineralization that is clearly associated with the extensive
3km gold in soil anomaly and progress the Ziatoyah gold discovery towards the
objective of resource status."
For further information you are invited to view the company's website at
http://www.hamakgold.com/ (http://www.hamakgold.com/) or please contact:
Hamak Gold Limited
Amara Kamara +231 (0) 77 005 0005
Nicholas Karl Smithson +44 (0) 77 837 07971
Peterhouse Capital Limited (Broker) +44 (0) 20 7469 0930
Lucy Williams
Guy Miller
Yellow Jersey PR +44 (0) 777 5194 357
Sarah Hollins
Annabelle Wills
About Hamak Gold Limited
Hamak Gold Limited (LSE: HAMA) is a UK listed company focussed on gold
exploration of a portfolio of licences in highly prospective areas of Liberia,
where significant drilling results have identified a new high-grade gold
discovery with the discovery hole returning 20m @ 7g/t Au near surface in its
Nimba licence on the border with Ivory Coast which is located in proximity to
the commercial Ity Gold Mine.
Chairman's Statement
Dear Shareholder,
I am pleased to present the annual report of Hamak Gold Limited (the "Company"
or "Hamak") and its subsidiary (collectively referred as the 'Group' or 'Hamak
Gold') for the period ended 31 December 2023. The Group undertakes gold
exploration with a focus on highly prospective licences in Liberia, West
Africa.
It is with great satisfaction that the 2023 general election in Liberia passed
peacefully and transparently, and we welcome the new administration of
President Joseph Boakai and look forward to working closely with the new team
at the Ministry of Mines led by newly appointed Minster of Mines and
Energy-Wilmot Paye.
As the President of the Liberian Chamber of Mines, I can attest to the fact
that there is growing interest in the mineral sector in Liberia due to
continued stability and improved governance and Hamak Gold has led the way
being the first, majority Liberian owned listed Company on the London Stock
Exchange.
Over the last year, we have continued our exploration focus on the Nimba
licence in northern Liberia, which is located near the four million ounce Ity
gold mine in neighbouring Ivory Coast. At Nimba, our geological teams have
discovered what we consider to be a high-grade gold discovery, with both
trenching and drill results showing wide intersections of gold with grades up
to seven grams per tonne over 20 metres ("m") from initial drilling.
Exploration work this year has included detailed geological mapping and
structural interpretation, ground geophysical surveys and additional
drilling.
The gold discovery at Nimba lies on the edge of an extensive three kilometre
("km") x one km gold in soil anomaly. Further mapping, structural
interpretation, trenching and drilling is required to delineate the
sub-surface extent of this discovery and our teams will be undertaking focused
exploration work during 2024 to hopefully trace the extent of gold
mineralization across a wider area which ultimately can be drilled into a
maiden resource.
Capital markets for the junior exploration sector have remained challenging
for some time. Despite this, in the past 12 months, the Company has
completed two equity placings to fund our ongoing exploration programme in
Liberia. This funding has come with significant support from Directors and
Management, as well as contributions from existing and new shareholders. In
late December 2022, a total gross proceeds of £295,750 was raised at a price
of 8.75p per share and the shares were issued in January 2023. This was
followed in July 2023 with a placing at the same 8.75p per share raising gross
proceeds of £294,500. Since the year end, in April 2024, in a very weak
market, the Company raised gross proceeds of £200,000 (before expenses) from
the issue of 16,000,000 new ordinary shares of no par value ("Ordinary
Shares") but at a price of £0.0125 each. In addition, the Company settled
certain director, management and advisory fees via the issue of 14,512,381
shares at the same placing price. I am grateful for the support shown in
taking shares and conserving cash in the Company. We continue to evaluate
and pursue alternative funding arrangements with which to progress our
exciting exploration portfolio.
At Hamak Gold we believe that there are interesting opportunities to acquire
or partner in new ventures in the wider African region and our technical team
has been assessing a number of interesting opportunities in gold and base
metals. We believe that a diversified portfolio may increase investor interest
and access to capital with which to progress our growth strategy.
Finally, I would like to thank our shareholders for their continued support
and the Board and Management for their excellent contribution to the
advancement of the strategy and objectives to make significant mineral
discoveries that can lead to the growth of our Company.
Amara Kamara
Executive Chairman
30 April 2024
Operations Report
The Group continues to focus its mineral exploration efforts on the discovery
of orogenic gold, Archaean and Paleoproterozoic greenstone hosted gold, and
shear zone hosted gold type mineralization in under-explored yet highly
prospective areas of Liberia.
Being an exploration business without producing mines, the Group has no
revenue and relies on equity as its major source of funding. If the Group is
successful in its exploration activities, it will seek to transition into an
exploration and development business.
After acquiring two mineral exploration licences (MEL) in Liberia in February
2022 and listing the Company on the London Stock Exchange (LSE) on the 1(st)
March 2022, the Group rapidly deployed field teams led by experienced
geologists. In both the Nimba and Gozohn licences, exploration initially
focused on detailed geochemical soil sampling in areas already associated with
artisanal digging; in the case of Nimba since the 1930's. In Gozohn, extensive
parts per billion ("ppb") gold-in-soil anomalies were discovered while at
Nimba considerably more significant soil anomalies in the parts per million
("ppm") range were revealed which prioritised this licence in the deployment
of more detailed sophisticated exploration techniques and methods, including
geophysics and drilling, during 2023. Based on the field work and exploration
results at Gozohn a relinquishment of part of the licence was made in 2022.
The Company retains a 129.6 square km licence area which remains the focus of
further exploration.
The relative location of the Nimba and Gozohn licences are shown in Figure 1
and currently cover a combined area of 1,116 km².
Figure 1: Location of Nimba and Gozohn mineral exploration licences and
neighbouring gold mines
Nimba Licence
The Nimba licence (MEL 7001518) covers an area of 985.6 square km and is
located approximately 120 km to the north-east of the Gozohn licence and some
40 km south-west of Endeavour's four-million-ounce Ity Gold Mine in
neighbouring Côte D'Ivoire (Figure 1).
Geochemical Soil Sampling and Results
Based on observations made during the pre-IPO Competent Person Report site
visit, three soil sampling blocks, totalling some 3,622 soil samples, were
sited over areas with either former or active artisanal digging activity. The
location of these blocks and their priority based on field evidence is shown
in Figure 2.
Figure 2: Location of prioritised soil sampling blocks in the Nimba licence
At Soil Sampling Block No. 1, a total of 1,124 samples were collected within a
3.7km x 3.4km grid with line and sample spacing of 250m and 50m respectively.
Samples were prepared in Monrovia and analysed by internationally renowned ALS
Global using the standard 51-element methodology on 25 gram aliquots with a
detection limit of 0.02 ppb Au. Standard QA/QC procedures were strictly
adhered to and no issues pertaining to QA and QC were encountered.
The Nimba Block 1 soil sampling results are presented in Figure3 and show
significant anomalous gold values in excess of 1 ppm (1 gram per tonne "g/t")
at two key locations, surrounded by additional anomalous values generating
coherent anomalies. Anomaly 1 (approximately 700m by 450m) attains a peak of
1.54ppm gold-in-soil whilst Anomaly 2 (approximately 900m by 500m) attains a
peak of 1.20ppm gold-in-soil.
During the soil sampling, the geological teams identified an exposed
geological unit, described as a metadolerite with visible sulphide
mineralisation (mainly pyrite) at Ziatoyah on the southern edge of the
northern soil anomaly, where there is active artisanal gold mining. Rock chip
sampling of this unit returned gold values of 37.3g/t Au and 45.5g/t Au,
proving the presence of bedrock gold associated with the soil sampling anomaly
(Figure 3).
Figure 3: Nimba Block 1 gold-in-soil anomalous results
Stream Sediment Sampling and Results
A soil sampling block (Block 3), shown in Figure 2, yielded disappointing
results in an area containing artisanal workings. To further test the
potential, some 29 stream sediment samples were collected over an area located
15km to the NNW of the Ziatoyah prospect. Sampling focused around a quartzite
ridge known as Mount Blah covering a drainage area of approximately 31.5km(2).
The samples were analysed by ALS Global using two detection methods Au-AA24
& AuME-TL43. The results complemented each other and are shown in Figure
4.
Figure 4: Positive stream sample results (in ppm) from Mt Blah - Nimba licence
Peak values of 2.23 ppm Au and 2.52 ppm Au (using the two different analytical
methods) were recorded along the western flank of Mt Blah within an area of
previous digging. Three other samples returned anomalous values of 0.512,
0.437 and 0.168 ppm Au suggesting a possible source towards the summit of the
quartzite ridge. Further prospecting is recommended in and around Mt Blah to
determine the geological characteristics of this positive isolated source.
Trenching and Channel Sampling at Nimba Block 1
Two 280m long trenches (excavated to a depth of 3m) were situated over single
or multipoint soil anomalies with values in excess of 1,000 ppb (1.0 g/t Au)
within the broad anomalous zone of Block 1. A total of 552 trench channel
samples (1 metre interval) were collected and analysed for Au only. While
neither trench intersected values equivalent to the soil values, there is a
general correlation between trench assay populations and soil values. Trench
sample values up to 250 ppb (0.25 g/t Au), within a zone of broad trace gold
values, are considered significant and merit further work for bulk tonnage
type targets.
At the Ziatoyah discovery outcrop some 43 channel samples were collected along
two faces across the outcrop area which has been exposed by artisanal mining.
Gold mineralization over a 66m wide zone has been proven at an average grade
of 0.8 g/t Au, which remains open ended, and includes grades of 0.98 g/t Au
over 11m (including 3.14 g/t Au over 3m) in the North face and 0.63 g/t Au
over 55m (including 1.94 g/t Au over 14m) in the southern face. The North face
results are shown in Figure 5. Visible gold was observed in hand specimen
collected at the outcrop. Two rock chip samples returned exceptionally high
values of 45.5 g/t Au and 37.3 g/t Au (Figure 5). This site is considered a
discovery outcrop and is named after the nearby stream, i.e. Ziatoyah (see
Figure 3).
Figure 5: North face channel & rock chip sample results at the Ziatoyah
discovery outcrop
Phase-1 Drilling Programme
Building on the positive results from the channel and rock chip sampling at
Ziatoyah, the Company decided to undertake a limited scout drilling programme
of 450m (over three holes) in Q3 2022 to test the potential down-dip extension
of the bedrock mineralization seen at the Ziatoyah artisanal workings.
The first hole (NZ22_001), after 26m, encountered a zone of strongly foliated
dark grey metadolerite with weak to moderate levels of dissemination and
smeared pyrite mineralisation of between 1 and 5% over the overall rock mass.
From 27.26m and 52.00m (down the hole), significant gold mineralisation was
returned between 28.0m and 48.0m (20.0m @ 7 g/t Au) with a high-grade zone
returning 5.0m @ 22 g/t as shown in Figure 6.
The second hole (NZ22_002) returned low-grade gold values (2.0m @ 0.28 g/t Au
between 55.0 and 57.0m) which seemed difficult to explain considering that
this hole was only 20m from the high-grade intercept in NZ22_001 and may have
drilled parallel to the dip of the main mineralisation and hence failed to cut
the mineralised zone.
Figure 6: Section through two drill holes (NZ22_001 & 002) at Ziatoyah
showing Au intercepts
Geophysical Survey
Given the presence of metallic sulphides at Ziatoyah in the Phase-1 drilling,
in early 2023 the Group conducted a geophysical survey using the electrical
induced polarization (IP) method, as well as a resistivity survey, over the
Ziatoyah prospect. An initial gradient array survey followed by 4.4 km of 25m
spaced dipole-dipole survey was carried out over a pilot block which was then
followed up by a 14-line km 50m dipole-dipole survey along 800m to 1,200m
lines long spaced between 100m and 200m apart.
The data quality of the IP and resistivity surveys was good and interpreted by
the geophysical consultants (GeoFocus) to detect the Ziatoyah mineralisation
in general. Suspected poor depth penetration of the 25m dipole data from the
pilot survey ensured that a 50m dipole-dipole array was chosen for the follow
up area. The resulting geophysical data was processed and interpreted by
GeoFocus who identified a strong, arcuate chargeability anomaly at depth,
trending north and NW away from the Ziatoyah outcrop, as well as other targets
recommended for drill testing (Figure 7).
Figure 7: IP chargeability plot with 2023 drill collars and topography
2023 Phase-2 Drilling Programme
A short Phase-2 drilling programme took place between July and August 2023 for
a total meterage of 1,000m across 13 holes.
The initial concept for this drilling programme was to drill test the
chargeability anomalies identified by GeoFocus, but also to drill test certain
secondary geological structures (faults and fractures) suspected to be
associated with the nearby Cestos shear zone. Furthermore, the Group was
determined to further define the mineralisation detected in the initial 2022
drill hole (NZ22_001).
Assays from 232 selected drill core samples (including QA/QC samples) were
analysed by ALS Ghana. The drill holes that tested the IP targets were broadly
negative and did not intersect meaningful gold mineralization. Unfortunately,
despite being aware of the possible impact of stream alluvium and sediments as
being the possible cause of the chargeability anomaly, the interpretation
focused on anomalous pseudosection values derived from the 50m dipole-dipole
survey without taking into consideration the effect of topography. It is
interpreted that the IP survey only managed to produce plots of the depth of
the overburden and distribution of conductive alluvial clays. The surficial
sediments, comprising wet conductive clays, likely masked the electrical
response of the underlying bedrock and mineralization.
However, drilling of certain structural targets proved more successful with
four holes returning intersections of low-tenor gold mineralization. Drilling
to date, over a limited area in the vicinity of the Ziatoyah discovery, has
produced the following significant intervals of gold mineralization (Table 1).
Table 1: Significant downhole drill intercepts at Nimba Block 1
Geology, Structural interpretation, and Mineralisation
The Cestos shear zone, located along the Nimba southeast licence boundary is
defined by a major NE trending dislocation zone. United States Geological
Survey (USGS) data implies a pattern of SW to westerly trending secondary
structures branching off this shear zone. Such secondary faults, or splays, as
shown in Figure 9, may have created extensional zones for the focus of
hydrothermal activity responsible for gold mineralisation.
Figure 9: The Cestos Shear Zone and branching secondary splay structures at
Ziatoyah
A detailed 3D structural interpretation was undertaken of the 2023 orientated
drill core, as well as surface outcrop mapping, around the localised Ziatoyah
discovery area by independent consultant Dr Colin Andrew. The current
interpretation is that gold mineralization is preferentially hosted within
mafic metasediments, such as those intersected in the discovery hole at
Ziatoyah (20m @ 7g/t Au). Similar lithologies are seen in other drill holes
and are associated with above background gold values, supported by the
presence of marmorized carbonates within the metasediment packages
intersected. It is considered that these assemblages pre-date the principal
Northeast faulting seen in the area and are folded in between the fault zones.
From the 3D structural interpretation (based on Finite Element Analysis
('FEA')) faulting is inferred in the vicinity of the Ziatoyah prospect. Plots
of foliation measurements from orientated core, including fractures and
faults, have revealed trends subparallel to the regional structural trend.
Combined with the gold assay results, the morphology of the Ziatoyah
mineralised body has been modelled. A steeply dipping mineralised zone has
been derived which appears to be dislocated by at least three inferred faults,
labelled as B, A & G in Figure 10, which is open at depth.
Figure 10: Modelled mineralised zone at Ziatoyah - based on FEA structural
analysis
The mineralization at the Ziatoyah prospect shows the classic signs of
sulphidation, with iron sulphides (mainly pyrite) forming between 1 and 5% of
the mineralised zone. The exploration work conducted to date highlights the
significant potential of the Ziatoyah prospect and further afield within the
Nimba licence which has significant upside and value.
A number of priority drill targets have been recommended for follow-up by Dr.
Colin Andrew. These targets are associated with known gold in soil anomalies
as well as possible extensions of structures and metasediments associated with
the high-grade Ziatoyah drill intersection and positive channel sampling
results.
The next phase of exploration work will include detailed surface mapping,
pitting/trenching and channel sampling. A low-cost handheld ground magnetic
survey over the broader gold-in-soil anomalous area is also recommended. This
work will preceed further drilling of positive anomalous values and structural
targets to test the extent of the Ziatoyah mineralization.
Gozohn Licence
The original Gozohn licence (MEL 7002318) covered an area of 766 square km and
is located some 30km south of the high-grade Kokoya Gold mine operated by MNG
Gold (Figure 1). After collecting some 2,628 soil samples from two grid blocks
during 2022, it was decided to relinquish 83% of the licence in favour of the
north and northeastern part which has been retained covering an area of 129.6
square km. Significant gold anomalies were returned over two areas of Block 1
located on the western slope of a prominent ridge (Mt Koklun) in an active
area of artisanal gold digging.
Surrounded by quartz feldspar Gneiss, Mt Koklun forms one of two areas
comprised of USGS defined, Composite "z" units, commonly associated with
greenstone lithologies. These units comprise an assemblage of interlayered
strongly deformed amphibolite, quartzite, schist and iron-formation (BIF)
which have been assigned a metasedimentary and metavolcanic origin. Such units
tend to form discontinuous elongate resistant ridges which stand notably above
the rolling Gneissic terrain. These supracrustal rocks can be found as fold
keels or in shear zones. At Gozohn, they form a fold with most of the positive
soil geochemistry being concentrated on the western limb of the antiform or
fold.
The extent of the gold anomaly, within the Composite "z" zone, is shown in
Figure 11.
Figure 11: Gozohn Block 1 soil geochemistry results.
Initially, soil sampling was conducted on a grid with lines spaced 250m and
500m apart with a sampling interval of 50m. A soil sampling infill programme
better defined the coherent anomalous area.
During the soil sampling, a number of rock chip samples were collected and
assayed. One sample of quartz-rich migmatite returned a value of 2.56 g/t Au
while a second rock chip sample from a nearby location returned 3.5 g/t Au.
These samples coincide with a strong gold in soil anomaly and are proximal to
artisanal diggings.
Geochemistry analysis and Mineralisation
The soil geochemistry results suggest that auriferous quartz stringers, seen
in artisanal diggings, have a primary mineralogy dominated by iron sulphides
and native gold associated with minor Au-tellurides and selenides. The lack of
typical Birimian-type geochemical halo, for example arsenic, suggests that
this mineralisation is more likely to be orogenic gold rather than BIF
associated Greenstone hosted type gold occurrences.
Channel sampling across an exposed face in the Morris camp diggings enabled
the collection of 46 channel samples (1m interval). The best results returned
of 507 ppb and 283 ppb Au which support the existence of narrow quartz veins
however additional exploration is required to determine the extent and grade
of the mineralization.
Option Licences
At the time of the IPO the Company held the option to acquire from Hamak
Mining Company five exploration licences, being Lofa, Fassama, Cestos, Sinoe
and River Gee. The Company previously announced that Cestos and River Gee
options were relinquished. Since the focus of exploration is primarily on
Nimba and Gozohn, the Company has elected not to exercise the options on the
remaining five licences.
Business plan and strategic objectives
The Group's strategic objectives are to be a successful mineral exploration company that through deploying systematic exploration techniques can lead to the discovery of a significant gold and base metal resources in the short to medium term (two to five years) on its mineral exploration properties in Liberia and other potential jurisdictions. The Group will seek to achieve these aims by managing its operations safely and sustainably, with a view to ensuring that, subject to successfully discovering commercially viable and extractable gold deposits, the Group will be in an optimal position to create value and generate returns for Shareholders and significant benefits for all stakeholders including local communities.
There are a number of risks associated with junior resource companies at the early exploration stage in the natural resources sector, especially in West Africa. The Board regularly reviews the risks to which the Group is exposed and endeavours to mitigate them as far as possible.
The following summary, which is not exhaustive, outlines some of the risks and uncertainties the Group may be exposed to:
Political conditions, government regulations, macroeconomic volatility and
regulatory risks
The Company's performance and growth may be constrained by delays or shutdowns
due to political, commercial or legal instability in Liberia. The ability of
the Company to generate long-term value for shareholders could be impacted by
these risks.
Changes may occur in local political, fiscal and legal systems, which might
adversely affect the ownership or operation of the Group's interests
including, inter alia, changes in exchange rates, currency, exchange control
regulations changes in government and in legislative, fiscal and regulatory
regimes. The Group's strategy has been formulated in light of the regulatory
environment as at the latest practicable date prior to the publication of this
Document and what are deemed to be probable future changes (though due regard
should be given to the uncertainty in making predictions involving political
governance risks).
Regional instability due to corruption, bribery and generally underdeveloped
corporate governance policies have the potential to impact the Group's
performance in Liberia and, as a result, the Company's share value. These
risks could have a materially adverse effect on the future profitability, the
ability to finance or, in extreme cases, the viability of the Group.
Within Liberia, a number of economic and political factors have contributed to
a lack of infrastructure investment. As such, the country lacks well-developed
infrastructure connections, which could impact the profitability of the
Group.
Economic challenges in Liberia, including high rates of unemployment, may lead
to a reduction in local, skilled workforce such that geologists, mining
engineers and other technically qualified and skilled individuals have gone
abroad for work. In the past international investors were reluctant to deploy
capital to Liberia, leading to significant underinvestment within its
exploration and mining sector. Although improving, these factors may create
operational challenges for the Group.
The licences held are subject to various laws and regulations relating to the
protection of the environment and the Group is also required to comply with
applicable health and safety and other regulatory standards. Environmental
legislation in particular can comprise numerous regulations which might
conflict with one another, and which cannot be consistently interpreted. Such
regulations typically cover a wide variety of matters including, without
limitation, prevention of waste pollution and protection of the environment,
labour regulations and worker safety. The Group may also be subject under such
regulations to clean-up costs and liability for toxic or hazardous substances
which may exist on or under any of its properties or which may be produced as
a result of its operations. The Group intends to operate in accordance with
high standards of environmental practice and comply in all material respects
and currently is not subject to any fines or liability or clean up cost in
relation to environmental rehabilitation.
Any failure to comply with relevant environmental, health and safety and other
regulatory standards may subject the Group to liability, fines and/or
penalties and have an adverse effect on the business and operations, financial
results or financial position of the Group. Furthermore, the future
introduction or enactment of new laws, guidelines and regulations could serve
to limit or curtail the growth and development of the Group's business or have
an otherwise negative impact on its operations. Any changes to, and increases
in, current regulation or legal requirements, with the enforcement thereof,
may have a material adverse effect upon the Group in terms of additional
compliance costs.
Renewal of licences as allowed for in the Mines Act is dependent on the
Company maintaining them in good standing on an annual basis. The Nimba and
Gozohn licences are both confirmed as valid and in good standing by the
Ministry of Mines at the time of this report.
Climate Related Financial Disclosures
The Company provides disclosures under the framework recommended by the Task
Force on Climate Related Disclosures (TCFD). These are designed to help
investors and wider stakeholders understand how Companies are managing climate
related financial risks.
Gold mining plays a vital part in the economic and social development of many
emerging or developing economies and the West African Republic of Liberia is
no exception in this regard as it is likely to be vulnerable to the disruptive
and potentially destructive impacts from climate change and extreme weather
events. Liberia has currently two operating gold mines and a number of small
explorers actively engaged in mineral exploration. There is therefore a
likelihood, even expectation, of new discoveries and hence additional mines
coming into production in Liberia in the near future. The Group, which
currently is in the exploration phase, is improving its awareness of climate
related risks and physical impacts and implementing better plans to prepare
for and adapt to these risks.
Climate change risks and impacts on gold exploration in Liberia
There is a wide range of factors that influence the adaption and resilience to
climate change in gold mining. However, at the prospecting or exploration
level, the main risks to our operations are physical factors manifested in
acute impacts (severe and short-term) and chronic impacts (long-term, gradual
change). Acute physical risk can be in the form of extreme weather and
weather-related events such as excessive rainfall (during the wet season) or
wildfires (during the dry season) while chronic impacts refer to enduring
changes and shifts in, for example, air and land temperatures. Since our gold
exploration activities are focused on the interior of Liberia, coastal and sea
level impacts are negligible. However extreme weather conditions may pose
challenges to access to site and lead to delays in exploration activities.
Gold exploration activities
The nature of our work involves the collection and analysis of samples of
various materials, ranging from rocks and earth (soils) to stream sediments in
our search for anomalous quantities of gold or gold-related minerals in the
natural geological environment. These samples are small amounting to a few
kilograms of material and are collected by teams of geologists (comprising 2
to 3 individuals). Remote sensing exploration techniques, including
geophysics, are practised occasionally while drilling of small diameter holes
(to ~ 100 - 150m) into the bedrock is also carried out - once anomalies have
been identified from the sampling programmes. Trenches and pits may be
periodically excavated and material samples. These mobile exploration
activities are conducted from temporary, often tented, camps and bases with
special attention to the maintaining of cordial and sound relations with our
host communities in the various villages impacted by our presence.
For the purposes of financial reporting requirements and disclosure, at our
current level of operations, climate-related risks are negligible. Should
exploration activities lead to a discovery and hence more permanent,
year-round, activities, the Company will reassess its position with regard to
climate-related management.
Limited operating history
The Group was formed and listed on the LSE two years ago so is relatively early stage in its development. However, the Board and Management of the Group have considerable exploration, development and mining experience in the West Africa region, in particular in Liberia, Sierra Leone and Guinea. This experience has helped lead the Group to making a significant new gold discovery in the Nimba exploration licence, within nine months of the Company's IPO.
Exploration and development risks
Following the Group's early exploration success in the Nimba licence, there
still remains a high degree of risk as mineral exploration and development can
be highly speculative and as of yet no mineral resource has been defined. The
economics of developing mineral properties are also affected by many factors
including the cost of operations, variations of the grade of ore mined,
fluctuations in the price of the minerals being mined, fluctuations in
exchange rates, costs of development, infrastructure and processing equipment
and such other factors as government regulations, including regulations
relating to royalties, allowable production, importing and exporting of
minerals and environmental protection.
In addition, the grade of mineralisation ultimately mined may differ from that indicated by drilling results and such differences could be material. As a result of these uncertainties, there can be no guarantee that mineral exploration and development of any of the Group's investments will result in profitable commercial operations.
Financing risk
Whilst the Directors are confident that the Group will be able to raise
additional funds as and when required and is expected to raise sufficient
funds to continue to meet its liabilities as they fall due for at least 12
months from the date of approval of the consolidated financial statements
there can be no assurance that such funds as may be required will be raised.
However since the listing, the Company has successfully concluded a number of
placings with the support of Directors, Management and shareholders and
therefore the directors are confident of successful future fund raises.
Industry-specific risks
The natural resources sector is inherently tied to the performance of the
global economy and fluctuations in the price of global commodities. As a
result, segments of the natural resources sectors (or even the sector as a
whole) could be affected by changes in general economic activity levels and
other changes which are beyond the Group's control. The revenues and earnings
from developing its assets will rely on commodity prices, and the Group will
be unable to control the prices for commodities which may adversely affect the
Group's business, results of operations, financial condition or prospects.
Key performance indicators
Appropriate key performance indicators will be identified in due course as the business strategy is implemented.
Gender analysis
A split of directors by gender during the year is shown below:
Male Female
5 Nil
Directors and employees
The Group currently has only male Directors and is committed to promoting gender equality based on relevant skills and experience as it progresses through its life cycle. At the current stage of exploration, the Group sourced individuals with experience not only in the sector but also in the wider West African and African settings. The Group seeks to bring in experienced female board member when available as finding the right fit is difficult at the current stage of operations. The Board, however, is diversified from an ethnicity perspective, having two Directors of African heritage which is appropriate given the Company is a Liberian majority-owned, and Liberian focussed, entity. The information provided is based on the updated personnel records maintained by the Group.
Environment, Social and Corporate Governance (ESG)
As a new Group focused on early-stage exploration, we aim to conduct our business with honesty, integrity and openness, respecting human rights and the interests of our shareholders, employees and local community stakeholders. We aim to provide timely, regular and reliable information on the business to all our shareholders and conduct our operations to the highest standards.
Environment
The Group submitted environmental licence reports and applications to allow
for exploration to continue in the Nimba and Gozohn licences. These permits
are issued by the Environmental Protection Agency (EPA) of Liberia according
to the prevailing laws of the country. Since the exploration is very early
stage there is no significant rehabilitation required. All sampling holes
are back filled at the end of the sampling process. Trenches are ring fenced
during excavation and back filled after completion. Drill pads are cleaned
and levelled after each hole. In the tropical environment of Liberia
vegetation rehabilitation is natural and rapid.
Social
The Group has conducted extensive exploration work at the Nimba licence and limited work at the Gozohn licence during 2023. The Group adheres to the social requirements within the country of working with local communities at all times, engaging with them so they are aware of our activities and where possible recruiting labour from nearby communities.
The Mineral Law of Liberia requires that 2% of exploration expenditure be invested in education or health facilities in the exploration licence areas where the work is conducted. In February 2023, the Group completed the handover of this 2% ($6,548) for the Nimba licence ($6,548) to the local communities.
Corporate Governance
Being a public Group listed on the LSE Standard Exchange, the Group adheres to all required governance rules as stated in the Corporate Governance Statementand has in place the necessary structure of Board committees to oversee the business of the Group to ensure adherence to best practice procedures.
Health and Safety
Although Hamak Gold has a relatively small permanent staff contingent in Liberia, the Company strives to create a safe and healthy working environment for the well-being of its staff and contractors and create a trusting and respectful environment, where all members of staff are encouraged to feel responsible for the reputation and performance of the Group. As the Company grows, it aims to establish a diverse and dynamic workforce with team players who have the experience and knowledge of the business operations and markets in which we operate. Through maintaining good communication, members of staff are encouraged to realize the objectives of the Group and their own potential.
Amara Kamara
Executive Chairman
29 April 2024
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2023
Continuing operations Notes Year ended Year ended
31 December 2023 31 December 2022
$'000 $'000
General and administrative expenses 7 3,215
660
Impairment of exploration cost 12 - 516
Operating loss 660 3,731
Net foreign exchange losses 24 -
Loss before taxation 684 3,731
Income tax 9 - -
Total loss for the year 684 3,731
Total comprehensive loss for the year attributable to shareholders from 684 3,731
continuing operations
Earning per share:
Basic and diluted earnings per share (USD) 10 (0.01) (0.17)
Consolidated Statement of Financial Position
As at 31 December 2023
As restated
2023 2022
Note
$'000 $'000
Non-current assets
Property, plant and equipment 11 23 33
Intangible assets 12 1,955 1,481
Total non-current assets 1,978 1,514
Current assets
Trade and other receivables 13 25 26
Cash and cash equivalents 2 12
Total current assets 27 38
Total assets 2,005 1,552
Equity and Liabilities
Equity attributable to owners of the parent
Share capital and share premium 15 3,805 2,758
Share-based payment reserve 16 16 80
Retained earnings (2,272) (1,697)
Total equity 1,549 1,141
Current liabilities
Trade and other payables 14 456 411
Total current liabilities 456 411
Total equity and liabilities 2,005 1,552
These financial statements were approved and authorised for issue by the Board
of Directors on 30 April 2024 and were signed on its behalf by:
Nicholas Karl Smithson
Executive Director
30 April 2024
Consolidated Statement of Changes in Equity
For the year ended 31 December 2023
Share capital and share premium Share based payment reserve Retained earnings Total
Equity
$'000 $'000 $'000 $'000
Balance at 1 January 2022 - - (355) (355)
Loss for the period - - (3,731) (3,731)
Total comprehensive income for the period - - (3,731) (3,731)
Transactions with owners in their capacity as owners:
Issue of share capital 2,973 - - 2,973
Share issue costs (215) - - (215)
Grant of share-based awards - 2,469 - 2,469
Exercise of share-based awards 2,389 (2,389) - -
Total 5,147 80 - 5,227
Balance at 31 December 2022 (as previously stated) 5,147 80 (4,086) 1,141
Prior year adjustment (note 20) (2,389) - 2,389 -
Balance at 31 December 2022 (as restated) 2,758 80 (1,697) 1,141
Loss for the period - - (684) (684)
Total comprehensive income for the period
- - (684) (684)
Transactions with owners in their capacity as owners:
Issue of share capital 1,076 - - 1,076
Share issue costs (29) - - (29)
Share based payment - vesting - 45 - 45
Share based payment - exercised/lapsed - (109) 109 -
Total 1,047 (64) - 1,019
Balance at 31 December 2023 3,805 16 (2,272) 1,549
Consolidated Statement of Cash Flows
For the year ended 31 December 2023
Notes Year ended Year ended
31 December 2023 31 December 2022
$'000 $'000
Cash flows from operating activities
Loss before taxation (684) (3,731)
Adjustments for:
Depreciation 11 10 8
Impairment of exploration costs 12 - 516
Share-based payment charge 16 45 2,469
Directors' fees paid in shares 8 160 204
Rent paid in shares 9 -
Unrealised foreign exchange charge - (3)
Net cashflow before changes in working capital (460) (537)
Increase/(decrease) in payables 157 (21)
Decrease/(increase) in receivables 1 (9)
Net cash used in operating activities (302) (567)
Cash flows from investing activities
Purchase of property, plant and equipment - (41)
Exploration expenditure (413) (549)
Net cash used in investing activities (413) (590)
Cash flows from financing activities
Issue of share capital (net of costs) 15 705 1,170
Net cash generated from financing activities 705 1,170
Net change in cash and cash equivalents during the year/period (10) 13
Cash at the beginning of year/period 12 (1)
Cash and cash equivalents at the end of the year/period 2 12
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