Kefi progressing Ethiopian gold project towards launch

7th May 2024

By: Tasneem Bulbulia

Senior Contributing Editor Online


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Aim-listed Kefi Gold and Copper has reported good progress, to schedule, at its high-grade Tulu Kapi gold project in Ethiopia.

The remaining finance syndicate board processes are on track for final (conditional) approvals during May, while project launch preparations have started at Tulu Kapi.

Kefi highlights that these developments coincide with the progress being made at other gold projects in the country, which it says showcases a positive turnaround in Ethiopia over the past two years.

Following previous progress reports, Kefi has now reported financing progress, including that all syndicate parties have now either confirmed final (conditional) approval or are targeting it this month.

Also, Kefi now targets an elevated beneficial interest in the Tulu Kapi Gold Mines Share Company, which holds the project, of 80%.

Also, corporate activity is increasing in the Arabian Nubian Shield and Kefi has received expressions of interest from other parties to potentially participate should the opportunity arise in Ethiopia, either at Tulu Kapi or in other growth opportunities being considered.

Regarding operational progress, Jacques Kruger has been appointed as the new project development manager and is working closely with project director Norman Green, the founder of Green Team International.

Also, Simon Cleghorn, Kefi’s original resource geologist and a core team member during the overhaul of the project in 2014 to 2015, has rejoined the company at the executive committee level after serving as chief geologist and COO respectively at Kazakh mining groups, Eurasian Resources Group and JSC AK Altynamas.

The company has also undertaken several precautionary safety measures and independent checks and has received government commitments to prepare for a safe construction programme at Tulu Kapi.

These commitments and independent checks have allowed the syndicate parties to advance their processes and remain on track for completing final approvals this month.

These activities are focused on the Tulu Kapi project launching in mid-2024 for production in mid-2026.

“I am delighted with the continuing progress on subsidiary-level project financing for launch in mid-2024 of the high-grade Tulu Kapi gold project, the current mineral resources of which are 1.72-million ounces at 2.65 g/t.

“Following previously reported final approvals by syndicate leaders for project debt, equity risk notes and share subscriptions to subsidiaries, we can now report further progress with those outstanding syndicate partners, such that all final approvals are on track to be received this month,” executive chairperson Harry Anagnostaras-Adams says.

In the interim, the company will escalate community consultations and preparations, he informs.

“Closing this $320-million international project finance package will be a notable accomplishment in today’s tough capital market conditions for the junior mining sector and will be testament to Kefi’s persistence and hard-won position within Ethiopia, which itself has withstood the many widely publicised challenges in recent years.

“The timing of our launch is fortuitously coinciding with the improved conditions in Ethiopia and the increased gold price. The Standard and Poor’s consensus long-term forecast for the gold price is now $1 965/oz and spot is higher,” he highlights.

“Combined openpit and underground production is targeted at about 200 000 oz/y of gold production which now represents an estimated gold export revenue of about $400-million a year (assuming a gold price of $1 965/oz, which would today be Ethiopia’s largest single export generator and a significant economic engine for local and regional benefits,” Anagnostaras-Adams says.

He indicates that with projected all-in-sustaining costs of about $860 /oz and break-even costs (after all debt-service) of about $1 200/oz, this presents a solid position for generation of net cash flow to Kefi.

“With a now-targeted Kefi beneficial ownership of 80%, this represents net cash flow entitlement to Kefi of approximately £63-million ($74-million) per annum over the first nine years, commencing from the second half of 2026.” 

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online



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