Gold exploration company broadens scope of operations with new MoU
BIRMINGHAM-registered gold exploration group, Hummingbird Resources is broadening the scope of its operations in Africa.
The company has signed a Memorandum of Understanding with Kola Gold Ltd with a view to amalgamating certain of its non-core gold exploration permits in Mali together with a number of Kola’s permits in Mali and Senegal.
This will result in the creation of a new company – Cora Gold Inc. – which will be the holding company for the permits.
The agreement establishes a portfolio of more than 10 highly prospective gold exploration properties with Kola, together totalling in excess of 1,600km2. They are located in two significant gold areas, the Kenieba Window in Mali and Senegal and the Yanfolila Gold Belt in Mali.
Hummingbird said the objective was to expedite development and provide value from non-core exploration assets through a 43% interest in Cora Gold without diverting cash resources from its flagship assets in the Yanfolila project in Mali and the Dugbe project in Liberia.
The amalgamation is conditional on Cora Gold raising at least $4m from third parties, successful due diligence and final documentation. The timetable for which is set at September 30, 2016.
The agreement also includes buy-back and royalty rights over the four permits closest to Yanfolila, which could add significant upside to Hummingbird’s +100,000 oz per year production, due to begin in 2017, together with the +1Moz outside of the current mine plan
Dan Betts, managing director of Hummingbird Resources, said: “This transaction doubles our exploration exposure in Mali and provides us with an introduction to Senegal and exciting new mineralised ground in Mali where we are currently focused on bringing Yanfolila, one of Africa’s highest margin undeveloped gold projects, to production next year.
“The potential upside for Hummingbird is significant, but importantly it allows us to develop exploration potential for the company whilst allowing us to remain absolutely focused on the development of the Yanfolila Gold Mine.
“With a dedicated exploration team that we know and trust, that has extensive experience in these gold belts and a budget to explore we look forward to unlocking the exploration value together with Kola.”
He added that owing to the presence of the mine at Yanfolila, any high grade discoveries nearby would instantly be more valuable to Cora Gold because they would be able to be processed at Yanfolila without the necessary capital expenditure required to build a new mine.
He said the company would update the market in due course of any developments.
