Tulu Kapi gold project, Ethiopia – update

Drill core from the Tulu Kapi project

Photo by Kefi Gold and Copper

24th May 2024

By: Sheila Barradas

Creamer Media Research Coordinator & Senior Deputy Editor


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Name of the Project
Tulu Kapi gold project.

Western Ethiopia.

Project Owner/s
Kefi Gold and Copper (formerly KEFI Minerals) will own 80% of the exploration and holding company for the government of Ethiopia, KME, which, in turn, will own 56% of Tulu Kapi Gold Mines Share Company (TKGM), thus bestowing Kefi with a 45% beneficial interest in the project.

Project Description
Tulu Kapi has an ore reserve estimate of 15.4-million tonnes at 2.1 g/t gold for 1.1-million ounces of gold.

Openpit gold production is estimated at 140 000 oz/y over a seven-year mine life.

Total life-of-mine production is estimated at 980 000 oz.

The conventional openpit mining operation will include a carbon-in-leach processing plant. The mine will be connected to Ethiopia’s electricity grid through a new, 47-km-long, 132 kV dedicated power line relatively close to the country’s major hydropower-generation source. An emergency diesel power plant will also be installed to provide emergency backup power for critical process equipment in the event of grid power failure.

A preliminary economic assessment has indicated the economic attractiveness of mining the underground deposit adjacent to the Tulu Kapi openpit after the startup of the openpit and the repaying of project debts through positive cash flows.

Potential Job Creation
The project is expected to create about 1 000 direct jobs and 5 000 to 10 000 indirect jobs, with foreign direct investment of about $500-million, including historical investment.

Net Present Value/Internal Rate of Return
Not stated.

Capital Expenditure

Planned Start/End Date
Production is expected to start in 2026.

Latest Developments
The project has been formally launched.

"Our launch timing is fortuitously coinciding with the improved conditions in Ethiopia and all-time high gold prices,” Kefi executive chairperson Harry Anagnostaras-Adams said on May 20.

The TKGM board includes representatives from Kefi and the Ethiopian federal and Oromia regional governments. This decision to launch Tulu Kapi follows deployment of dedicated site policing and the conditional confirmations that quickly ensued from all members of the project's finance syndicate.

Early works until September will include the completion of preparation for community resettlement, detailed engineering for procurement, community consultations on social development plans, recruitment and other organisational development.

Concurrent closing of project financing will require independent monitoring over the next few months to ensure that early works field activities progress on schedule under the newly established policing and related safety protection systems. It will also include the satisfaction of all other conditions precedent. Further, the execution of definitive detailed documentation will also need to be conducted and the drawdown of financing syndicate equity-risk capital from October to mid-2025, followed by debt capital.

The finance plan includes debt risk capital in the form of $190-million secured debt from the development banks; equity risk capital, excluding historical investment of about $100-million sourced from Kefi's shareholders; a $110-million equity risk note sourced by Kefi from Ethiopian subsidiaries of multinational corporations, repayable in cash or, at Kefi's discretion, with Kefi shares issued at market prices in the second year of production; and $20-million TKGM share subscriptions from the federal and regional governments.

Recently approved exemptions from exchange and capital controls facilitate that investors and other financiers are assured of unrestricted capital servicing, Kefi has said.

Major works will start in October. These will include the procurement and fabrication of the plant internationally, community resettlement, site earthworks, grade-control drilling, transportation to site and assembly of plant and associated infrastructure, mining, and a definitive feasibility study on an underground mine.

Key Contractors, Suppliers and Consultants
Principal contractors: Lycopodium (process plant design and construction); PW Mining; the Ethiopian Electric Power Company; and the Ethiopian Roads Authority.

Contact Details for Project Information
Kefi Gold and Copper, tel +90 232 381 9431, fax +90 232 381 9071 or email

Edited by Creamer Media Reporter



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