Contractual disputes at Kouroussa gold mine in Guinea have halted operations, affecting production and cash flow.
IMPACT
Owner Hummingbird Resources plc’s principal contract miner Corica Mining Services temporarily suspended mining operations as of 17 March 2024.
The company said that the suspension was “a clear breach of the mining contract” and has given Corica notice to return to work by 19 March.
“As previously announced, since the commencement of the contract, Corica has failed to meet mining contract volumes due to delays in mining equipment mobilisation, commissioning, and overall operating performance.”
The processing plant is operating consistently at name plate capacity, and higher-grade ore scheduled to be accessed from the next blast.
The company added it was well positioned to reach commercial production levels once full mining is achieved.
The stoppage follows a previous halt in operations following a fire at the primary fuel depot in Conkary.
“Hummingbird is working to reach full mining capacity, while continuing to process both low-grade stockpiles and ore being mined separately by a supporting mining contractor which was appointed in H2-2023 to support Corica‘s mining activities.
“The supporting mining contractor has one fleet on site to support the contracted four fleets from Corica.
“The processing plant is expected to continue to run in the near term, however until increased mining capacity is available, reaching commercial production will not be possible, with production and cash flows increasingly impacted.”
Failure to do so could see Hummingbird could step in to resume mining and work with alternative mining contractors and equipment suppliers to achieve full mining operations.
The company added it was in discussion with its primary lender, Coris Bank International, on the potential implications of the halt in mining on forecast production and the cash flows for the group.
Coris has been the company’s main financing partner since it financed the construction of the Yanfolila gold mine in Mali in 2017.