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GOLD
20
MODERN MINING
March 2017
L
ocated in the Sikasso region of
south-west Mali close to the bor-
der with Guinea, Yanfolila was
acquired by Hummingbird from
Gold Fields in 2014 in a deal worth
US$20 million (with Gold Fields accept-
ing payment in Hummingbird shares). In the
roughly six years that it held the project, Gold
Fields spent in the region of US$100 million
on exploration and development studies, tak-
ing it to a very advanced stage. Commenting at
the time on Gold Fields’ decision to relinquish
Yanfolila, CEO Nick Holland said: “Yanfolila
is a robust, high-grade project, but the scale of
the known resources does not support a Gold
Fields-scale operation and is better suited to
development by a junior.”
Gold Fields was planning a 3 Mt/a opera-
tion at Yanfolila. Hummingbird has scaled this
back considerably to 1,24 Mt/a, in the process
bringing down the capex to a remarkably low
US$79 million. “We’ve benefited from the fact
that we inherited a high quality project with a
significant amount of infrastructure from Gold
Fields,” says Monro. “This included a well-
developed mine camp, able to house around
80 employees, which we’re in the process of
expanding by 30 %. Quite apart from this,
however, Yanfolila has no issues which would
complicate mining or processing and this has
helped to keep the capex low. The ore, for
example, is amenable to processing via simple
gravity and CIL processing.”
He adds that a major saving has also been
possible in respect of the tailings storage facility
(TSF). “We have a natural valley available for
this facility – so really all we need is an embank-
ment wall and a clay liner for the basin.”
Since acquiring Yanfolila, Hummingbird has
been steadily improving the economics of the
project, producing an Optimisation Study (in
March 2015), a DFS (in January 2016) and an
Optimised Mine Schedule (in February 2016).
The result is that Yanfolila now has outstand-
ing metrics. The NPV (at an 8 % discount rate
and a gold price of US$1 250) is estimated at
US$162 million and the after-tax IRR at 60 %.
The project remains very robust at a gold price
of US$1 100 with the IRR in this case being
42 %. The all-in sustaining cash cost (AISC) is
very competitive at around US$700 per ounce
and will place the mine in the bottom quartile
Construction of the Yanfolila gold project in Mali is nowmore than a third complete and the
developer, AIM-quoted Hummingbird Resources, is confident that the newmine – which will produce
132 000 ounces of gold in its first year of operation – will pour its first gold in late December this year.
Hummingbird’s Head of Business Development, Robert Monro, told
Modern Mining
at the recent
Mining Indaba in Cape Town that the site was currently a hive of activity with construction work pro-
ceeding on schedule and major long-lead items now starting to arrive on site.
Yanfolila
a hive of activity