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(Alliance News) - Shares in Kefi Gold & Copper PLC rose on Tuesday, after the company noted progress on the multi-party financing package for its Tulu Kapi gold project.
Kefi is a Nicosia, Cyprus-based gold and copper exploration company, focused on assets in Ethiopia and Saudi Arabia. Shares in the company were up 16% at 0.66 pence each in London at midday on Tuesday.
This followed Kefi's announcement that financing arrangements for its 95%-owned Tulu Kapi gold project in western Ethiopia was nearing completion.
In January, Kefi received confirmation of conditional final credit committee approval from its lead lender.
The company said that the other parties involved in the funding syndicate will go to their respective credit committees to approve the funding package this month. The contractors involved in the syndicate have also reaffirmed their readiness to enter into the drafted definitive documentation for a full project launch in the first half of 2024, in line with previous timelines.
The total financing plan for Tulu Kapi amounts to USD320 million, excluding the mining fleet provided by its contractor, PW Mining, and historical expenditures of around USD100 million.
Of this, the debt portion of USD190 million has been secured from the project's lead lender, Southern and Eastern Africa Trade and Development Bank, and co-lender, Africa Finance Corporation.
USD40 million has been raised through share issues by subsidiaries of Kefi. A further USD70 million was raised from local subsidiaries which were given Ethiopian government permission to invest local currency in October.
In October, Kefi received formal confirmation from the Ethiopian national bank of the details for the operation of offshore banking by its operating subsidiary Tulu Kapi Gold Mines Share Co. According to Kefi, this move by the Ethiopian government waived the mining project from foreign exchange controls and capital controls.
As the company awaits the drawdown of the USD320 million project funding, it has commenced launch preparations for Tulu Kapi. Personnel have been dispatched to brief the area's community and carry out site works. Kefi has also begun dismantling the old exploration camp and installing new communication and staging bases along its transport route.
Kefi's Executive Chair Harry Anagnostaras-Adams said: "This multi-party subsidiary-level financing is now advancing on the back of the government commitments finally received in October, triggering the lead-lender to quickly process its approval in December 2023 and now all other stakeholders triggering their respective flow-on processes."
By Hugh Cameron, Alliance News reporter
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