Hummingbird Resources (LON:HUM) has increased its stake in the under construction Yanfolila gold project in Mali to 80% with the exercise of an option over a further 5% of the equity.
The AIM-listed junior is buying out La Petite Mine d'Or’s interest for US$1mln, plus paying a further US$1mln to acquire its 1% royalty. Both considerations will be paid in shares.
WATCH: 'Full steam ahead at Yanfolila' as Hummingbird Resources ups stake to 80%
A 3% royalty to Mali over the project remains in place, with the government owning the remaining 20% of the project.
Dan Betts, Hummingbird’s chief executive, said reducing the royalties increases the benefit as “we firmly believe the mine life will increase significantly as we convert further Resources into Reserves once we are in production”.
"We continue to make excellent progress on site and as a result we continue to advance Yanfolila to production both on time and on budget."
Hummingbird is targeting first production from Yanofilia by the end of 2017.
The mine has a probable reserve of 709,800oz at 3.14g/t and total resources of 1.8Moz of gold.