Hummingbird Resources to acquire Kouroussa Gold Project in Guinea

Gold ore mining company Hummingbird Resources said on Monday that it will acquire the Kouroussa Gold Project in Guinea from Cassidy Gold for an initial consideration of £10m.

Hummingbird said the near term development asset, located in the "prolific" Siguiri Basin, had a high-grade mineral resource of 1.18m ounces of gold at more than 3 grams per tonne and noted that the acquisition would transform the group into a near term multi-asset producer with jurisdictional diversification in line with its strategy.

The AIM-listed firm added that first gold production was targeted within two years, with production estimated to come in at roughly 100,000 ounces per year.

In addition to the £10m payment to Cassidy, satisfied through the issue of 35.24m new ordinary shares in Hummingbird, the group will also pay a deferred consideration of £10 for every ounce of gold reserve published in excess of 400,000 ounces. Cassidy will also retain a 2% net smelter royalty on all gold sales by or on behalf of the company over and above the first 200,000 ounces of its production and sales.

Chief executive Dan Betts said: "Over the last few years we have looked at a vast number of projects and Kouroussa ticks every box in terms of a next mine for Hummingbird.

"It is of the scale, geology, process circuit design and grade that are all perfect for our team's experience to be put to immediate use, and it is in line with our strategy to focus on high margin projects."

As of 0915 BST, Hummingbird shares were up 1.92% at 26.50p.