REG - Hummingbird Res. - Dugbe Gold Project Feasibility Study Results
13/06/2022 16:45
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RNS Number : 7064O Hummingbird Resources PLC 13 June 2022
Hummingbird Resources plc / Ticker: HUM / Index: AIM / Sector: Mining
13 June 2022
Hummingbird Resources plc
("Hummingbird" or the "Company")
Dugbe Gold Project Feasibility Study Results
Pre-Tax NPV5% of US$690 million, Pre-Tax IRR of 26.35% & AISC of
US$1,005/oz over a 14-year LOM
Hummingbird Resources plc (AIM: HUM) is pleased to announce that Pasofino
Gold Ltd ("Pasofino") (TSXV: VEIN) has released the results of the Dugbe Gold
Project Feasibility Study ("FS"), which is located in Southern Liberia. The FS
was prepared by Pasofino's lead engineers, DRA Global (South Africa), in
accordance with Canadian Securities Administrators' National Instrument
43-101 Standards of Disclosure for Mineral Projects ("NI 43-101").
For the full Pasofino release details and graphics, please follow the link
here
(https://www.pasofinogold.com/news/news-details/2022/Pasofino-Gold-Announces-Feasibility-Study-Results-for-the-Dugbe-Gold-Open-Pit-Project-in-Liberia/default.aspx)
.
Highlights:
· Strong financial metrics
o Pre-tax NPV5% of US$690 million ("M") (US$530M post-tax), 26.35% IRR
(23.6% post-tax) at a base gold price of US$1,700 ounce ("oz").
· Fast capital payback of approximately 3.5 years from start of
production
o Life of mine ("LOM") All In Sustaining Cost ("AISC") of US$1,005/oz and
US$29/t cash cost(( 1 (#_ftn1) )) .
o Pre-production capital requirement of US$397M excluding owners' costs for
a 5Mtpa processing plant.
· Large Mineral Reserve with potential for expansion
o 2.27Moz gold produced over a 14-year LOM.
o Average annual production of 200,000oz for the first five years.
o 2.76Moz of Mineral Reserves.
o Additional 67 thousand oz ("koz") of Inferred Mineral Resources within the
FS pit and immediate sidewalls, which have not been included in the Mineral
Reserves.
· Simple project with economies of scale
o LOM strip ratio of 4.21:1, highlighted by a low 3.56:1 ratio in the first
five years.
o Simple (Gravity-CIL) process flow sheet, which enhances project economics.
o Low power costs of US$0.175/kWh, with opportunities for long-term savings
with alternative renewable energy sources.
· ESG
o Environmental and social impact assessment ("ESIA") process nearing
completion, with submission to the EPA expected in June 2022.
· Infrastructure-Ready Project
o Only 76km by road from the Port of Greenville to the Dugbe Project, which
was repaired and improved as part of the FS process.
o All build and operational cargo to be transported through the operating
Port of Greenville.
o Government supported berthing rights at the Port of Greenville for the
Project.
o Tuzon and Dugbe F deposits are 4km apart, serviced by a central processing
plant.
o LNG power generation hybridised with solar PV power generation to produce
an estimated levelised cost of energy of US$ 175.10/MWh.
Dan Betts, CEO of Hummingbird Resources, commented:
"We are delighted to receive the results from the robust FS that has been
conducted by Pasofino. The FS has been conducted to a high standard and has
seen a complete remodelling of the Resource base, to now showcase a
significant 2.76Moz Reserve base, long LOM of 14 years with upside given the
material exploration potential available and a low AISC profile of USD1,005/oz
to underpin a gold mine of material value. We look forward to now working with
Pasofino to conduct a strategic review of our options to best realise the
maximum value of Dugbe for all stakeholders."
Pasofino Earn-In Update
Pursuant to NI 43-101, the FS will be filed by Pasofino at www.sedar.com
(http://www.sedar.com) within 45 days of this news release. Subject to the
filing by Pasofino of the FS under Pasofino's profile at www.sedar.com
(http://www.sedar.com) , and final administrative documentation, Hummingbird
has confirmed that the FS has been carried out to the agreed standards and
will satisfy the technical requirements to allow Pasofino to earn its 49%
economic interest in the Project (prior to the issuance of the Government
of Liberia's 10% carried interest). Further, both Pasofino and Hummingbird
will have the right to exercise the option to consolidate ownership by
converting Hummingbird's 51% ownership of the Project for a 51% shareholding
in Pasofino, such that Pasofino would own 100% of the Project (prior to the
government of Liberia's 10% carried interest), subject to the receipt of all
required approvals including the TSX Venture Exchange.
Mineral Resource Statement
Reasonable Prospects for Eventual Economic Extraction
For both deposits, reasonable prospects for eventual economic extraction were
established based on open pit mining satisfied by means of a conceptual pit
shell. All blocks outside the pits were excluded from the Mineral Resource
Estimate. Key parameters used for the pit shells were: Gold price of
US$1700/oz Au, overall slope angle of 55 degrees, dilution of 10%, recovery of
90%, mining costs of US$1.93 per tonne for waste and US$ 2.24 and US$ 2.84
per tonne for Tuzon and Dugbe F respecti
Combined Mineral Resource Estimate Statement
The combined statement for both deposits is provided in Table 1 subdivided
using a 0.5g/t Au grade category and reported above a lower 'marginal' cut-off
grade. Within the 0.5 g/t Au grade category, the Measured and Indicated
tonnage is 75.2Mt grading 1.37g/t Au containing 3.31Moz gold plus an Inferred
tonnage of 14.9Mt at 1.23g/t Au containing 588 thousand ounces ("koz") gold.
Although not shown as a grade category in Table 1, above a 1.0g/t Au cut-off,
the combined Measured and Indicated part of the MRE is 2.88Moz of gold
contained in 56.6 million tonnes ("Mt") grading 1.58 grams per tonne ("g/t"),
mostly hosted within the HG domain at Tuzon.
Table 1. Mineral Resource Estimate effective 17 November 2021
Classification Tonnage (Mt) Grade (Au g/t) Contained Gold (koz)
Subtotal above 0.5 g/t Au Tuzon deposit Measured - - -
Indicated 53.2 1.40 2,396
Measured & Indicated 53.2 1.40 2,396
Inferred 7.5 1.13 270
Dugbe F deposit Measured 1.2 1.44 56
Indicated 20.8 1.28 860
Measured & Indicated 22.1 1.29 916
Inferred 7.4 1.34 317
Subtotal Measured 1.2 1.44 56
Indicated 74.0 1.37 3,256
Measured & Indicated 75.2 1.37 3,312
Inferred 14.9 1.23 588
Subtotal MRE for material between the marginal cut-off grade and 0.5 g/t Au Tuzon deposit Measured - - -
Indicated 5.8 0.43 81
Measured & Indicated 5.8 0.43 81
Inferred 2.0 0.44 29
Dugbe F deposit Measured - - -
Indicated 0.2 0.45 3
Measured & Indicated 0.2 0.45 3
Inferred 0.01 0.44 0.2
Subtotal Measured - - -
Indicated 6.0 0.43 84
Measured & Indicated 6.0 0.43 84
Inferred 2.1 0.44 29
Total MRE - the above subtotals combined Tuzon deposit Measured
Indicated 59.0 1.31 2,477
Measured + Indicated 59.0 1.31 2,477
Inferred 9.5 0.98 300
Dugbe F deposit Measured 1.2 1.44 56
Indicated 21.0 1.28 863
Measured + Indicated 22.2 1.29 919
Inferred 7.40 1.33 318
TOTAL Measured 1.2 1.44 56
Indicated 80.0 1.30 3,340
Measured + Indicated 81.2 1.30 3,396
Inferred 16.9 1.13 617
Notes:
1. The effective date of the Mineral Resource Estimate is 17 November
2021.
2. The marginal cut-off grades for Tuzon are 0.34g/t Au for fresh material
and 0.39g/t Au for weathered material. The marginal cut-off grades for Dugbe F
are 0.36g/t Au for fresh material and 0.40g/t Au for weathered material.
3. Rounding errors may be evident when combining totals in the table but
are immaterial.
4. The Qualified Person is Mr. Martin Pittuck (CEng, MIMMM).
5. The Mineral Resource has been classified under the guidelines of the
Canadian Institute of Mining, Metallurgy and Petroleum (CIM) and undertaken
within the context of the Canadian Securities Administrators' National
Instrument 43-101 (NI 43-101).
6. Mineral Resources are not Mineral Reserves and have no demonstrated
economic viability. The estimate of Mineral Resources may be materially
affected by environmental, permitting, legal, marketing or other relevant
issues.
7. Mineral Resource estimates are stated within conceptual pit shells that
have been used to define Reasonable Prospects for Eventual Economic Extraction
(RPEEE). The pit shells used the following main parameters: (i) Au price of
US$1700/ounce; (ii) plant recovery of 90%; and (iii) mean specific gravity of
2.78t/m(3) for mineralised gneiss and 2.64t/m‑(3) for pegmatite in fresh
rock and 2.1t/m(3) for oxide material.
Mineral Reserve Estimate
The Mineral Reserve Estimate (MRev) has been prepared as part of the Dugbe FS
completed by DRA, using the CIM definitions and guidelines adopted in May 2014
(CIM, 2014) and procedures for classifying the reported Mineral Reserves were
undertaken within the context of the Canadian Securities Administrators'
National Instrument 43-101 ("NI 43-101")-Table 2.
The Mineral Reserves were derived from the MREs and the block models presented
in the Mineral Resource section. The Mineral Reserves are based on the
Measured and Indicated Mineral Resources that have been identified as being
economically extractable and which incorporate mining losses and dilution. A
summary of the Mineral Reserves by deposit is shown in the table below.
Though not considered for the Mineral Reserve Estimate there are Inferred
Mineral Resources within the FS pit and in immediate proximity to it. This
material comprises 1.7 Mt at an average grade of 1.25 g/t Au containing
67 koz and may be converted to Indicated Mineral Resources with a relatively
small number of additional drillholes. If this is realised, they may then
contribute additional material to future Mineral Reserve Estimates.
Table 2. Mineral Reserve Estimate effective 1 May 2022
Classification Tonnage (Mt) Grade (Au g/t) Contained Gold (koz)
Total Mineral Reserve above 0.5g/t cut-off Tuzon deposit Proven
Probable 48 1.35 2,087
Subtotal 48 1.35 2,087
Dugbe F deposit Proven 1 1.34 45
Probable 17 1.15 629
Subtotal 18 1.16 674
Proven 1 1.34 45
Probable 65 1.29 2,716
TOTAL 66 1.30 2,760
Notes:
8. The effective date of the Mineral Reserve is 1 May
2022.
9. Mineral Reserves are defined within pit designs guided by pit shells.
10. Mineral Reserves are reported at 0.50g/t cut-off grade and a metal price
of US$1,600/oz Au.
11. Figures are rounded to the appropriate level of precision for the
reporting of Mineral Reserves. Due to rounding some columns or rows may not
compute as shown.
12. The Mineral Reserves are stated as diluted dry metric tonnes. Estimated
dilution applied to Dugbe F is 10.1% and Tuzon 6.9%, while estimated losses
were 6.3% for Dugbe F and 5.0% for Tuzon.
13. The Qualified Person is Mr Frikkie Fourie (B.Eng, Pr.Eng, MSAIMM).
14. The Mineral Reserves have been classified under the guidelines of the
Canadian Institute of Mining, Metallurgy and Petroleum (CIM) .
Capital Cost Estimate
The project capital has been derived predominantly from tendered costs and
rates from the market, as well as relevant database costs from recent
projects, and is summarised in Table 3. Capital is within the accuracy of a
Class 3 Association of the Advancement of Cost Engineering ("AACE") estimate
of (+20 %/-15%).
Table 3. Capital Summary
DIRECT TOTAL US$ M
Process Plant 129
Process Plant Infrastructure 37
General Site Infrastructure 77
Tailings Storage Facility 19
Access Road 36
Port Infrastructure 8
Mining 22
Sub-Total: Base Estimate Cost 326
INDIRECT
General Indirect Costs 71
SUB TOTAL: PRE PRODUCTION CAPITAL 397
OWNER'S COST
Owner's Cost 37
TOTAL COST 435
Note: Rounding may cause totals to differ.
Operating Cost Estimate
The operating costs over life of Project include mine operations, process
plant, TSF and general and administrative ("G&A") costs. Total LoM average
operational costs are estimated to be approximately US$154 million per annum
equivalent to a unit rate of US$29.47t RoM. An overview of operational costs
is presented in Table 4.
Table 4. LOM operating expenditure (columns may not add up due to rounding)
DESCRIPTION LOM (US$ M) LOM (US$/t)
Processing (Incl TSF) 700 10.71
Mining 764 11.52
G&A 100 1.51
Other 378 5.71
TOTAL 1,953 29.47
Economic Outcomes
Table 5 summarises the robust economics for the Project resulting from
detailed engineering across all disciplines.
Table 5. Economic outcomes summary
DESCRIPTION UNITS VALUE
Production LoM years 14
Production LoM months 159
Total Ore Tonnes M tonnes 66.27
Total Au Ounces Recovered M Oz 2.27
LoP Average
Throughput t/a 5.00
Au Grade g/t 1.30
Au Recovery % 83.01
Au Ounces Recovered Oz/a 171,594
Initial Capital Cost M US$ 435
SIB Capital Cost M US$ 98
Operating Cost
LoP Average M US$/a 147
LoP Unit Cost US$/t 29
NPV M US$ 690
IRR % 26.35
Payback Period (undiscounted) years 3.3
AISC US$/Oz 1,005
AISC per ton US$/t 34
NPV M US$ 530
IRR % 23.6
Payback Period (undiscounted) years 3.3
AISC US$/Oz 1,005
AISC per ton US$/t 34
Qualified Persons Statement
Scientific or technical information in this disclosure (other than information
that relates to mining, processing and related infrastructure results) was
reviewed by Mr Martin Pittuck, a full-time employee of SRK Consulting UK Ltd.
Mr Pittuck is a member in good standing with the Institute of Materials,
Minerals and Mining, a Fellow of the Geological Society of London and is a
Chartered Engineer; he has sufficient experience that is relevant to the
commodity, style of mineralisation under consideration and activity which he
is undertaking to qualify as a Qualified Person under National Instrument
43-101.
Scientific or technical information in this disclosure that relates to
processing and related infrastructure results was reviewed by Mr Robin Welsh,
a full-time employee of DRA Global. Mr Welsh is a Professional Engineer in
good standing with the Engineering Council of South Africa and has sufficient
experience that is relevant to the project under consideration which he is
undertaking to qualify as a Qualified Person under National Instrument 43-101.
Scientific or technical information in this disclosure that relates to
metallurgy and processing results was reviewed by Mr Marius Phillips, a
full-time employee of DRA Global. Mr Phillips is a Chartered Professional
Member of the Australasian Institute of Mining & Metallurgy and has
sufficient experience that is relevant to the project under consideration
which he is undertaking to qualify as a Qualified Person under National
Instrument 43-101.
Scientific or technical information in this disclosure that relates to mining
results was reviewed by Mr Frikkie Fourie, an independent consultant for DRA
Global. Mr Fourie is a Professional Engineer in good standing with the
Engineering Council of South Africa, is a Member of the South African
Institute of Mining and Metallurgy and has sufficient experience that is
relevant to the project under consideration which he is undertaking to qualify
as a Qualified Person under National Instrument 43-101.
Scientific or technical information in this disclosure that relates to
tailings storage facility results was reviewed by Mr Guy Wiid, a permanent
employee for Epoch Resources. Mr Wiid is a Professional Engineer in good
standing with the Engineering Council of South Africa, and a Chartered
Engineering good standing with the American Society of Civil Engineers and has
sufficient experience that is relevant to the project under consideration
which he is undertaking to qualify as a Qualified Person under National
Instrument 43-101.
Scientific or technical information in this disclosure that relates to
environmental, social and governance results was reviewed by Ms Fiona
Cessford-Le Roux, a full-time employee of SRK UK. Ms Cessford-Le Roux is a
Chartered Environmentalist in good standing with and a fellow of the
Institute of Materials, Minerals & Mining of the United Kingdom She has
sufficient experience which is relevant to the project under consideration
which she is undertaking to qualify as a Qualified Person under National
Instrument 43-101.
Scientific or technical information in this disclosure that relates to
financial results was reviewed by Mr Juan Kotzee, an independent consultant
for DRA Global. Mr Kotzee is a Financial Accountant, and has sufficient
experience that is relevant to the project under consideration which he is
undertaking to qualify as a Qualified Person under National Instrument 43-101.
Noris Del Bel Belluz, Group Technical Services Manager for the Hummingbird,
and is a qualified person, according to the Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves ("JORC Code, 2012
Edition") and "Qualified Person" as defined by Part 1 of NI 43-101 Standards
of Disclosure for Mineral Projects (30 June, 2011 Edition).
About The Dugbe Gold Project
The 2,559 km(2) Dugbe Gold Project is in southern Liberia and situated within
the southwestern corner of the Birimian Supergroup which is host to the
majority of West African gold deposits. To date, two deposits have been
identified on the Project; Dugbe F and Tuzon discovered by Hummingbird in 2009
and 2011 respectively. The deposits are located within 4 km of the Dugbe Shear
Zone which is thought to have played a role in large scale gold mineralization
in the area.
A large amount of exploration in the area was conducted by Hummingbird up
until 2012 including 74,497 m of diamond coring. Pasofino drilled an
additional 14,584 metres at Tuzon and Dugbe during 2021. Both deposits have
Mineral Resource Estimates dated 17 November 2021. Following the completion of
the Definitive Feasibility Study in June 2022 a Mineral Reserve Estimate was
declared, based on the open-pit mining of both deposits over a 14-year Life of
Mine.
In addition, there are many gold prospects within the Project including the
Bukon Jedeh area acquired in late 2020. Here artisanal mining has extracted
gold since the 1930's and includes currently active open pits over 20 m deep
working fresh bedrock. At the DSZ target on the Tuzon-Sackor trend Pasofino
has discovered a broad zone of surface gold mineralisation in trench and
outcrop along strike from Tuzon. At this and several of the other prospects no
drilling has been carried out to date.
In 2019, Hummingbird signed a 25-year Mineral Development Agreement ("MDA")
with the Government of Liberia providing the necessary long-term framework and
stabilisation of taxes and duties. Under the terms of the MDA, the royalty
rate on gold production is 3%, the income tax rate payable is 25% (with credit
given for historic exploration expenditures), the fuel duty is reduced by 50%,
and the Government of Liberia is granted a free carried interest of 10% in the
Project.
For further information, please visit www.hummingbirdresources.co.uk
(http://www.hummingbirdresources.co.uk/) or contact:
Daniel Betts, CEO Hummingbird Resources plc Tel: +44 (0) 20 7409 6660
Thomas Hill, FD
Edward Montgomery, CSO & ESG
James Spinney Strand Hanson Limited Tel: +44 (0) 20 7409 3494
Ritchie Balmer Nominated Adviser
James Asensio Canaccord Genuity Limited Tel: +44 (0) 20 7523 8000
Thomas Diehl Broker
Bobby Morse Buchanan Tel: +44 (0) 20 7466 5000
Ariadna Peretz Financial PR/IR Email: HUM@buchanan.uk.com
James Husband
Notes to Editors:
Hummingbird Resources (AIM: HUM) is a leading multi-asset,
multi-jurisdiction gold production, development and exploration Company and
member of the World Gold Council ("WGC"). Hummingbird's vision is to
continue to grow its asset base, producing profitable ounces, while continuing
to focus on its Environmental, Social & Governance ("ESG") policies and
practices. The Company currently has two core gold projects, the
producing Yanfolila Gold Mine in Mali, and the Kouroussa gold development
project in Guinea . Further, the Company has a controlling interest in
the Dugbe Gold Project in Liberia that is being developed by Pasofino Gold
Limited through an earn-in agreement.
(( 1 (#_ftnref1) )) Cash costs per payable ounce and AISC per payable ounce
are non-IFRS financial measures. Please see "Cautionary Note Regarding
Non-IFRS Measures". AISC per payable ounce includes all mining costs,
processing costs, mine level G&A, royalties, sustaining capital and
closure costs. Cash costs per payable ounce includes all mining costs,
processing costs, mine level G&A and royalties.
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