Hummingbird Resources Plc (HUM), owner of gold exploration licenses in Liberia, aims to reach a deposit of as much as 3 million ounces by the end of the month and begin developing a mine.
The company, which in September raised the reserve at the Dugbe pit of its project in eastern Liberia to 1.8 million ounces, is targeting a maiden resource of about 1 million ounces at the Tuzon pit within a couple of weeks, Managing Director Daniel Betts said in an interview in London.
Hummingbird won’t build a mine until it reaches the target, he said. “There’s this magic number -- 3 million ounces. It’s seen as a world class, significant deposit, and it’s much easier to raise the funding.”
The miner needs to raise about $40 million to complete feasibility studies, which would take about two years, Betts said. It will then need about two years to finish construction at a cost of $200 million to $250 million, he said. The company aims to have annual production of 200,000 ounces of gold with a mine life of about 15 years, Betts said.
That would be “a fantastic gold mine and be a big operation,” he said. “That’s what I’d like to target.”
Betts, whose family business in Birmingham has been refining gold for 250 years, used his father Stephen’s contacts to explore in Liberia, he said. The company increased its gold reserve to 1.8 million ounces from the 800 million ounces it announced when it listed in London in December 2010.
Hummingbird plans to start digging next month at the iron deposit with partner Petmin Ltd. (PET), South Africa’s largest anthracite coal miner, Betts said. The companies may consider selling the project to BHP, ArcelorMittal, or a Chinese company after defining resources, he said.
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