Hummingbird secures capital to reach gold production target

Hummingbird Resources, an AIM listed gold production, development and exploration company, has announced that it has secured two credit facilities worth $55m to overcome the final corporate hurdle in the development of the Yanfolila gold project in Mali.

The first is a $45m senior secured term facility and the second a $10m cost overrun facility with Taurus Funds Management.

The miner has also extended its existing bridge loan facility with Taurus to $25m from $15m and prolonged the repayment date to 8 April 2017. The bridge loan facility is expected to be refinanced by the senior secured term facility.

Total capital expenditure for Yanfolila is $88m which leaves the project fully funded into positive cash flow with $71m of equity raised earlier this year combined with this facility.

The group is on budget and schedule for first gold pour from Yanfolila by the end of 2017 targeting production of 132,000 oz in the first year.

Chief executive Dan Betts said: "Following successful equity raisings totalling US$71 million earlier this year, I am happy to report that construction is now well under way with over 20% of the Project capex committed. We are very pleased with the progress made to date on site and securing this additional debt facility sees the final corporate hurdle overcome in order to expedite the construction process ahead of our initial gold pour, targeted by the end of 2017.”

Executive director of Taurus Michael Davies said: "We have completed an extremely rigorous due diligence process on the Yanfolila Gold Project and are pleased to sign the mandate for the debt facility with Hummingbird. We continue to work closely with the Company as they develop and commission the Project and look forward to a long and fruitful relationship."

The share price fell 0.52% to 19.15p at the close on Tuesday.