RE: 4p11 Nov 2019 14:02
OMITC agreed 100% next few trading sessions will see the real rise take place imo:
The focus for the Company in Ethiopia is now to close the prearranged project equity financing for the Company's Tulu Kapi Gold Project (the "Project") in light of the Ethiopian Government resolving its final administrative arrangements for the Project development, as announced on 7 November 2019. As previously disclosed, its asset level partners are to provide US$58 million of equity in a staged investment into the Project, a proportion of which will subsequently be available at the KEFI Minerals plc level to fund Ethiopian-related corporate and exploration costs. Following clearance from the Government, the Project equity closing processes are now being dealt with and KEFI looks forward to updating the market upon completion. The planned Project equity and subsequent debt closings are intended to have the effect that:
· Project subsidiary Tulu Kapi Gold Mines Share Company ("TKGM") becomes self-reliant for its gold mine development programme during that two-year period; and
· Ethiopian exploration programmes will also have been funded for that period of construction.
The NPV of KEFI's planned 45% beneficial interest in the Project open pit ranges between:
· a "base case NPV" of £41 million (US$52 million) at US$1,300/oz at start of construction this year if it is assumed that KEFI has to parri passu fund the Project equity. If one takes into account that KEFI has already made most of its contribution to Project equity and that its partners will now provide the next Project equity injection, this "KEFI base case NPV" is more appropriately estimated at £57 million (US$74 million) at US$1,300/oz;
· a "current gold price NPV" of £100 million (US$127 million) at US$1,460/oz at start of production in 2021; and
· 5 (KEFI's base case) to 9 times (current gold price) the current market capitalisation of the Company of c.£11 million (US$14 million) following the issuance of these new shares under the Loan Facility.