TIDMKEFI
RNS Number : 4662C
Kefi Gold and Copper PLC
21 June 2021
21 June 2021
KEFI Gold and Copper plc
("KEFI" or the "Company")
Operational Update
KEFI (AIM: KEFI), the gold and copper exploration and
development company with projects in the Federal Democratic
Republic of Ethiopia and the Kingdom of Saudi Arabia, is pleased to
provide an operational update.
Ethiopia
Today is election day in Ethiopia. These are widely regarded as
the most important elections in the country's history. The
electioneering atmosphere in the lead-up around the country has
been one of vibrant, but peaceful campaigning, reflecting very
positively on the reforms over recent years. Ethiopia remains
amongst the highest growth countries in Africa and the world,
whilst it continues to push its agenda of liberal and democratic
reform.
Tulu Kapi Project Finance
The Tulu Kapi Gold Project (the "Project" or "Tulu Kapi")
remains on track with previous guidance and KEFI, through its
subsidiary Tulu Kapi Gold Mines Share Company ("TKGM"), has
presented its Project finance syndicate and submitted its Project
finance plan to the Ethiopian central bank ("National Bank of
Ethiopia", or "NBE") for permission that it may proceed as
outlined. This follows a long, thorough and rigorous due diligence
process by the Senior Lenders.
Whilst the NBE conducts its review, the other outstanding
administrative details are being progressed with the various
Ethiopian Government agencies including, the Ministry of Mines and
Petroleum ("MOMP"), Ministry of Finance, Ethiopian Roads Authority
and Ethiopian Electricity Power Corporation. These are normal
compliance procedures to enable KEFI/TKGM and its syndicate of
financiers and contractors to proceed to financial closing, which
includes, inter alia, execution of detailed documentation,
subscription of the asset-level equity funds and triggering full
development, with debt funds to be disbursed later this year in
compliance with the Senior Lenders specified conditions.
These procedural matters include requests for finalising
confirmations of registration of historic investment, establishment
of correspondent bank account arrangements, confirmation of
construction schedules for road and electricity, and various other
administrative matters already agreed in principle.
Starting full development of the Project is the highest priority
for KEFI and the Ethiopian Government. All key stakeholders are
pushing hard to finalise preparations and the Company has
undertaken to the MOMP that, upon timely receipt of these
confirmations, KEFI will push to financial closing by the end of
July 2021, or as near as possible thereto given the local document
registration procedures and the COVID-affected limitations of
syndicate parties' physical locations.
Recent Tulu Kapi Project Activities
KEFI continues to oversee the physical preparations for full
development to be triggered at financial closing, such as:
-- Clearing of new host lands for community members to
be resettled;
-- Overseeing the early works programme of detailed engineering
and procurement, by principal construction contractor
Lycopodium;
-- Supporting the planning and procurement programmes
of mining services contractor Corica;
-- Overseeing the 'new access road' and 'electricity connection'
works contracts; under which surveys and procurement
has been completed;
-- Triggering compensation procedures for the first resettlers
at the Tulu Kapi electrical substation site; and
-- Recruitment of further key personnel for the next stage
of the Project.
Saudi Arabia
Hawiah Gold Project
KEFI's operations in Saudi Arabia are conducted through its 34%
owned joint-venture company, Gold & Minerals Ltd ("G&M"),
where KEFI is the operating partner.
G&M are working to finish the Phase 4 drilling programme in
Q3 2021 with the goal of reporting an expanded and upgraded Mineral
Resource. With Ramadan having ended, drilling since late May 2021
has been 24/7 with three rigs on site.
The Preliminary Feasibility Study for the potential start of
development of the Hawiah deposit in 2023 continues, and other
recent activities have included the following:
-- Completion of the Environmental and Social Baseline
Study;
-- Metallurgical testing progressing with reasonable
recoveries so far being indicated for all principal
metals, copper, gold, zinc and silver; and
-- Completion of the exploration camp construction.
Enquiries
KEFI Gold and Copper plc
Harry Anagnostaras-Adams (Executive Chairman) +357 99457843
John Leach (Finance Director) +357 99208130
SP Angel Corporate Finance LLP (Nominated
Adviser and Joint Broker) +44 (0) 20 3470 0470
Jeff Keating, Adam Cowl
Brandon Hill Capital Ltd (Joint Broker) +44 (0) 20 7936 5200
Oliver Stansfield, Jonathan Evans
IFC Advisory Ltd (Financial PR and IR) +44 (0) 20 3934 6630
Tim Metcalfe, Florence Chandler
Notes to Editor
KEFI Gold and Copper plc
KEFI is focused primarily on the advanced Tulu Kapi Gold Project
development project in Ethiopia, along with its pipeline of other
projects within the highly prospective Arabian-Nubian Shield. KEFI
targets that production at Tulu Kapi generates cash flows for
capital repayments, further exploration and expansion as warranted
and, when appropriate, dividends to shareholders.
KEFI in Ethiopia
Ethiopia is currently undergoing a remarkable transformation
both politically and economically.
The Tulu Kapi gold project in western Ethiopia is being
progressed towards development, following a grant of a Mining
Licence in April 2015.
The Company has now refined contractual terms for project
construction and operation, together with assembling the full
funding consortium and set the conditional terms for the
development funding package of c.US$221 million.
Estimates include gold production of c.190,000oz pa. All-in
Sustaining Costs (including operating, sustaining capital and
closure but not including leasing and other financing charges)
remain c. US$800/oz. Tulu Kapi's Ore Reserve estimate totals 15.4Mt
at 2.1g/t gold, containing 1.1Moz.
All aspects of the Tulu Kapi (open pit) gold project have been
reported in compliance with the JORC Code (2012) and subjected to
reviews by appropriate independent experts.
A Preliminary Economic Assessment has been published that
indicates the economic attractiveness of mining the underground
deposit adjacent to the Tulu Kapi open pit, after the start-up of
the open pit and after positive cash flows have begun to repay
project debts. An area of over 1,000 square kilometres adjacent to
Tulu Kapi has been reserved for exploration by KEFI upon
commencement of development, with a view to adding satellite
deposits to development and production plans.
KEFI in the Kingdom of Saudi Arabia
In 2009, KEFI formed Gold & Minerals Limited ("G&M") in
Saudi Arabia with local Saudi partner, ARTAR, to explore for gold
and associated metals in the Arabian-Nubian Shield. KEFI has a 34%
interest in G&M and is the operating partner.
ARTAR, on behalf of G&M, holds over 16 Exploration Licence
(ELA) applications pending the introduction of the new Mining Law.
ELs are renewable for up to three years and bestow the exclusive
right to explore and to obtain a 30-year exploitation (mining)
lease within the area.
The Kingdom of Saudi Arabia has announced policies to encourage
mineral exploration and development, and KEFI Minerals supports
this priority by serving as the technical partner within G&M.
ARTAR also serves this government policy as the major partner in
G&M, which is one of the early movers in the modern resurgence
of the Kingdom's minerals sector.
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