KEY POINTS
- Hummingbird resolves historical disputes with Mali, agreeing to a $16.4 million settlement and tax adjustments under the 2023 Mining Code for Yanfolila Mine.
- The agreement includes permit renewals, an expanded mining perimeter, and operational strategies to optimize production and extend the mine’s life.
- Mali increases its stake in SMK to 20%, while Hummingbird restructures debt and seeks funding for the first settlement payment.
Hummingbird Resources Plc has reached a $16.4 million settlement agreement with the Government of Mali regarding the application of the 2023 Mining Code to its Yanfolila Gold Mine.
The deal, facilitated through the company’s subsidiary, Société des Mines de Komana SA (SMK), establishes a clear framework for resolving historical disputes and securing future operational stability.
Key terms of the agreement
After a year of productive negotiations with a commission of government advisors, the agreement ensures Yanfolila’s transition to Mali’s 2023 Mining Code.
As part of this framework, the government has granted a 2 percent reduction in the Special Tax on Certain Products (ISCP) rate for the duration of the new establishment agreement.
A central element of the settlement is the payment of FCFA 10 billion (approximately $16.4 million), divided into two equal installments.
The first payment is due within five working days of signing, while the second installment must be made by June 30, 2025.
Additionally, Hummingbird has waived claims to historical VAT credits amounting to FCFA 10 billion, effectively settling all prior tax and customs issues by December 31, 2023.
Operational and strategic commitments
Under the agreement, Hummingbird is required to deliver a comprehensive operating plan, detailing necessary capital investments to optimize production and extend the mine’s lifespan.
As part of these efforts, the company plans to restructure its existing debts to reinforce operational resilience.
In a show of support for the agreement, the Government of Mali has committed to renewing key exploration permits and expanding the Komana Mining Permit perimeter.
The move aligns with Hummingbird’s broader strategy to enhance its mining footprint in Mali. Additionally, the government has exercised its option to increase its ownership in SMK from 10 percent to 20 percent, effective immediately.
Funding and strategic collaboration
Hummingbird is in advanced discussions with CIG SA to secure funding for the initial settlement payment. Updates on this front are expected in due course.
CEO remarks
Geoff Eyre, Interim CEO of Hummingbird Resources, stated:
“This agreement marks a pivotal moment in our relationship with the Government of Mali. By resolving historical issues and securing vital operational agreements, we have laid the groundwork for a sustainable and prosperous future at Yanfolila.
The renewal of exploration permits and the extension of our mining permit perimeter underscore Mali’s commitment to this partnership.”
Hummingbird Resources is a multi-asset gold producer with operations spanning Mali, Guinea, and Liberia. Its key projects include the Yanfolila Gold Mine, the Kouroussa Gold Mine, and a controlling interest in the Dugbe Gold Project, developed in collaboration with Pasofino Gold Limited.
This agreement underscores Hummingbird’s commitment to sustainable operations and its partnership with Mali as it continues to grow its presence in West Africa.
