AIM-listed Hummingbird Resources has announced that its subsidiary, Société des Mines de Komana SA (SMK), has reached agreement with the Government of Mali regarding application of the 2023 Mining Code to the Company's Yanfolila Gold Mine.
During the last 12 months, Hummingbird and SMK, have engaged in productive discussions with a commission comprised of Government advisors and representatives to address outstanding audit findings and clarify the application of the 2023 Mining Code to Yanfolila. The Agreement represents a comprehensive framework addressing historical matters and establishing clear operational parameters for the future operation and development of Yanfolila. Key terms include Yanfolila’s migration to Mali's 2023 Mining Code with the Mali State granting a 2% reduction on the Special Tax on Certain Products rate (ISCP) for the duration of the new establishment agreement.
The Agreement includes a settlement payment totalling FCFA 10 billion (approximately US$16.4 million), payable in two equal instalments of FCFA 5 billion each, with the first payment due within five working days of signing and the second payment by 30 June 2025. Additionally, the Company has agreed to waive historical VAT credit claims in the sum of FCFA 10 billion, collectively settling all tax and customs matters prior to 31 December 2023.
Under the Agreement, the Company commits to providing a comprehensive operating plan, addressing capital investments required to maximise current production and extend Yanfolila’s mine life. As part of this, the Company and SMK intend to restructure its existing debts to ensure operational stability.
The State has confirmed its commitment to renew key exploration permits, alongside approving an extension to the Komana Mining Permit perimeter, supporting the Company's broader strategy in Mali. Additionally, as has been previously announced, the Government of Mali has exercised its option to increase its ownership in SMK to 20%, with immediate effect, from the 10% the State currently holds.
Hummingbird is in advanced discussions with CIG SA to secure additional funding to meet the Company’s financial obligations for the first payment to the Government pursuant to the Agreement. Further updates will be provided in due course.
Geoff Eyre, Interim CEO of Hummingbird, commented:
"This agreement represents a significant milestone in our relationship with the Government of Mali and provides a stable framework for our continued operation and development of the Yanfolila Gold Mine. Through constructive dialogue with the Government, we have addressed historical matters while securing important operational agreements that support our long-term investment in the country. The renewal of exploration permits and extension of our mining permit perimeter demonstrates Mali's commitment to our partnership.”
