Member Info for urai5

Many thanks from the German-speaking area for your perfect online reporting @Robjm66. I have another question about the Umm Ad Damar auction at KSA; I didn't quite get it. ARTAR has applied. Is Kefi included or not? Thank you for a short feedback.
urai5

Anyone who is invested in Kefi Gold and Copper - or is considering an investment at this depressed level, should definitely watch the following (video) presentation from AGM 6/30/2022:

HAA goes into great detail about the prevailing (difficult or challenging) circumstances in Ethiopia. Things may have become (extremely) simplified in Saudi Arabia as a result of the government's new strategy away from oil and towards other value-added industries, including mining: regulation has been modernized and capital is available.

The USP (Unique Selling Proposition) for Kefi Gold and Copper is the opportunity to invest in the Arabia-Nubian Shield. Apparently the very last under-explored world region for mining - and therefore offers sky-is-the-limit potential - particularly in the Kingdom of Saudi Arabia with km-long mineralization (wording HAA), where no one had previously explored.

The bet on Kefi is very simple: After all these years of disappointments, will the company succeed in developing at least 2 projects into production within plus/minus 3 years. Personally, I assume that with Kefi Gold and Copper, HAA has a very good chance of achieving the ambitious goals that have been set. I stay invested.

The RNS does not change my assessment: It is absolutely open and is the very last chance for HAA and Kefi for Tulu Kapi in Ethiopia.

Specifically, it is about: How are the payment modalities regulated in the Umbrella Agreement (framework contract). And if a payment of 80m$ by July 7, 2022 to the Ethiopian central bank is scheduled to be received by investors, this payment will actually be made.

The problem is and has been conditionnel over and over again. Even the RNS says: "any attaching remaining conditions". It was just never clear - always "conditionnel" which we don't know. And this "conditional" is obviously no longer accepted by the Ethiopian Ministry of Mines.

But: I remain invested. After all, the last capital increase went through with 0.8 GBX. This means Kefi would have a few million extra dollars to support development in Saudi Arabia. With the best will in the world, I simply cannot see why the assets in the KSA could also be lost because of the (possible, final) Ethiopia drama. Because the operator there - and thus the owner of the drill analyzes and the exploration know-how - is at Kefi Gold and Copper.

urai5

While I'm at it, we can clarify one more point:

RE: Secure mining license TK: 80m$ until July 7th, 2022 at Ethiopian central bank, Sat 22:30

RE: Secure mining license TK: 80m$ until July 7th, 2022 at Ethiopian central bank,Today 09:13

(...)"but there's much you are missing out simply because the real information is not publicly available and a few continue to suppress anything leaking out even on this platform. Unfortunate."

You see, 2 times the same post along the lines of: "I know something you don't know."

So if you know something - and I'm assuming you're not an insider - write it down. But only give hints - this creates uncertainty. And that's why I reacted like this in the post "RE: Be Careful What You Wish For, Today 15:01".

Thank you for your feedback. I'm agree with you on the next process steps 1 to 7. Also regarding assessment, absolutely open.

But please note your following post:
RE: LICENSE REVOCATION DEADLINE DAY: JULY 7TH 2022; 24 Jun 2022 10:34:
7th of July is only 13 days to go
not long enough to wire $80m

It may be that I didn't really grasp the deeper meaning due to my limited knowledge of the English language. But to me that sounds suggestive that Kefi Gold and Copper CANNOT - according to your opinion - the Ministry of Mines requirements and therefore may lose the license.

In general: With vague hints and gentle references to more intimate knowledge, uncertainty is created rather than clarity. It's not exactly clear to me what (hidden) agenda @Cracker10 is pursuing. I assume @Cracker10 lives in Ethiopia.

Tulu Kapi is in Africa/Ethiopia. Ethiopia is ranked 87th in the CORRUPTION PERCEPTIONS INDEX, together with Kosovo and North Macedonia (Europe) - but still way ahead of, for example, Ukraine (ranked 122).
https://www.transparency.org/en/cpi/2021

A Chinese company owns all of the exploration licenses that Kefi had applied for, including the one around Tulu Kapi. License MOM/EL/00005/2022: Xingxu Mining International Investments, Hong Kong. A private limited company, founded on March 24th, 2021. Will probably be advanced.

Then to the statements of the Minister of Mines regarding 80m$ by July 7th, 2022 at the Ethiopian Central Bank:

The RNS dated June 15, 2022 states:
- Sign the funding ‘Umbrella Agreement’ during June 2022 to demonstrate the full funding commitment, in particular to the Ministry
- Evidence of the full funding capacity of each syndicate member to the Ministry

I cannot see any differences, tricks or ambiguities between the wording of the Minister of Mines at a press conference and the wording in the RNS of June 15, 2022. The $80m should be right. We should find out on June 30th, 2022.

Then the question is whether the assets in Ethiopia and those of Saudi Arabia are linked by an (invisible) "umbilical cord" or not. I can not judge over this. However, I would email Kefi Gold and Copper directly after the (hopefully not arriving) notice that the license for Tulu Kapi had expired. In any case, I see no connection from a distance of many thousands of kilometers, certainly not legally. But of course an investment in Kefi Gold and Copper is absolutely high risk and Ethiopia and KSA are new Mining Jurisdiction with corresponding risks.

Again: vague hints are unhelpful.

Here is the reply email I received at 10:17 CEST (copy/paste):

Hi urai
We note your concerns and appreciate your feedback.
Your questions and others recently received are being collated and will be answered during our AGM webcast (details to be provided closer to 30 June).
Kind regards,
Roger
---------------------------------------------

My assessment:
It was clear that no details could be communicated NOW. Every word would probably be wrong resp. stock price relevant and therefore very critical. The AGM is on Thursday, June 30th, 2022. I assume that statements will be made there - positive or negative. Because the ominous July 7, 2022 is only a week later. The moment of truth for Kefi Gold and Copper and HAA has definitely come. I am convinced that there would be no more chance for HAA in Ethiopia - Tulu Kapi is "virtually surrounded" by the Chinese. But don't forget: Saudi assets in the Arabia-Nubian Shield with Hawiah and Jibal Qutman are worth more than the current (low) market capitalization.

urai5

Yes @chasf, I thought about that too. The core value of a developer is the mine plan. But Tulu Kapi is open pit with very simple metallurgy. And don't forget: According to my information, the processing plant will be built in China.

In my opinion, it really is the very last chance for HAA and Kefi to bring Tulu Kapi into production. The Umbrella Agreement must be signed by all members of the consortium by the end of June. Then we should also (finally) know the following:

1. Who exactly are the Mining Financiers ($60m) and Ethiopian Subsidiaries of International Groups ($35m) and Ethiopian Private Investor ($9m).

2. And what are the exact contract clauses for financing Tulu Kapi. And there could effectively be the 80m$ paid into an account of the Ethiopian central bank.

I understand the current frustration of disappointed shareholders very well; I belong too. But the fallback layer with assets in KSA Hawiah and Jibal Qutman has been the main reason I remain invested.

Now again to the financing and the corresponding evidence. The last month's update says the following:
"- Sign the funding ‘Umbrella Agreement’ during June 2022 to demonstrate the full funding commitment, in particular to the Ministry
- Evidence of the full funding capacity of each syndicate member to the Ministry"

And so it is understandable and plausible for me that the risk capital (subordinated debt and equity) has to be deposited at the Ethiopian central bank. Because the Mines Ministry defines the rules of the game. A "promise to pay" is probably sufficient for the African banks with the $140m loan.

Not only do we shareholders have no more patience - the Ministry of Mines also wants to see facts now - specifically capital.

PS Please excuse me, as not every term is likely to be translated correctly. I write in German and have the text translated by the online translator.

The Annual General Meeting of KEFI Gold and Copper plc to be held on 30 June 2022, at 10.00 a.m. (BST).
https://www.kefi-minerals.com/files/announcements/kefi-agm-notice-of-meeting-and-proxy-form-6june22.pdf

I understand your point of view very well @Robjm66. Regarding the credibility of the Twitter thread and the difficult-to-hear statement in Amharic: It's a question of comprehensibility.

For me it is (very) understandable, according to which TKGM must have deposited 80m$ with the Ethiopian National Bank by July 7th, 2022. That is also very possible - as I judge the financing construct.

I assume the Umbrella Agreement is a legal obligation to fund Tulu Kapi. The two African banks are likely to be the most cautious with $140m for the processing plant. It is therefore logical for me that the "risk capital" (subordinated debt 75m$ plus equity Kefi 5m$) must first be paid into the Ethiopian central bank. When the money comes in, the government also has assurance that the mine will be built effectively. The whole thing follows the logic step by step.

Regarding the performance of IR: I rate the performance of Kefi as good. The problem now is that any official statement in an RNS can instantly affect the stock price. Q&A is more harmless. We are now talking about almost 2 weeks: And then it should be clear. I have my greatest doubts that the Ethiopian government will give HAA and Kefi another chance. Because the Chinese are at the door. All the uncertainty is reflected in the share price. Because I am convinced that the assets in Saudi Arabia Hawiah and Jibal Qutman alone are worth much more than the current market capitalization.

Regarding the security situation: I am convinced that the Ethiopian government can guarantee security. The question simply arises as to whether ALL members of the consortium see it that way.

PS: I remain invested - if only because of KSA.
PPS: I sent an email to Kefi.

Conclusion:

Now the moment of truth has definitely arrived. HAA MUST deliver:

1. Independent Safety Report

2. Signature of the umbrella agreement by all partners in the consortium by the end of June 2022

3. Receipt of 80m$ by 7 July 2022 at the Central Bank of Ethiopia (75m subortinated Debt, 5m$ Equity Kefi).

I can't seriously assess the probability; but I will write to Kefi Gold an Copper later today and ask about the safety report, whether it has now been accepted by all members of the consortium and if not, by when the approval can be expected.

Sorry guys, I missed that Kefi Gold and Copper probably never got the exploration license for the 1'100km2. Meanwhile, Tulu Kapi is now practically surrounded by the "Chinese". It is also useless to blame the government of Ethiopia for the delays (civil war, administrative inadequacies). And it is a fact that China is more flexible than western democracies when it comes to investing in third world countries when it comes to ESG standards.

The hints from @cracker 10 and @theaviator in the advfn forum are almost certainly correct. Thank you for the research work.

So I really believe that the Minister of Mines' announcement that TKGM will automatically revoke its mining license for Tulu Kapi as of July 8, 2022 is real. This means Kefi resp. TKGM has until July 7, 2022 to deposit the required $80m with the Ethiopian central bank.

Therefore, we have to take a closer look at the financing. Decisive is pdf page 7 of the annual report:
https://www.kefi-minerals.com/files/announcements/kefi-annual-report-2021-website.pdf

After that, the funding of Tulu Kapi in the amount of $356m is planned as follows:

56m$ mining fleet by the mining contractor
$140m senior project debt,
$38m Government and Local Investors directly into TKGM
122m$ KEFI-funded component, separate and in addition to historical investment
$356m Total TKGM

Now it's about the $122m, which Kefi has to provide directly.
This total is broken down as follows:
60m$ Subordinated non-convertible, offtake-linked debt
15m$ Subordinated debt convertible
$20m Subordinated convertible
27 Recent issues of KEFI shares and the exercise of the attached warrants
$122m Total Provided by KEFI

The first question now arises: How could the $80m be composed?

I'm assuming it's the following items:
60m$ Subordinated non-convertible, offtake-linked debt
15m$ Subordinated debt convertible into KEFI shares at VWAP in 3 years
5m$ resp. £4.1m ex latest capital increase at £0.8m gross of £8m.
80m$ Total

The second question arises: When could the $80m be available?

If everything goes as planned, the umbrella agreement should be in place by the end of June 2022 - which brings us to the 3rd and all-important question:

Was the security audit resp. the independent security report ensuring the security of the mine site, camp and access routes accepted by all members of the consortium?

The government of Ethiopia is responsible for ensuring security. But if just one member of the consortium is of the opinion that the security is not sufficient for an investment in the millions, then: game over. We still remember the ANS Mining theater in 2019 when ANS Mining requested a Security Audit audit. Was pure delaying tactics, since the first-class aperitif club did NOT have the millions of dollars. Because the Chinese would then probably be more flexible: 1 reinforced infantry battalion (drones) with 1000 (civilian) security forces would be enough - whether military or civilian, I said ye

Indeed, Kefi Gold and Copper may have lost its exploration licenses for approximately 1,100 km2. A company from Hong Kong an others has secured the licenses around Tulu Kapi. The following website is authoritative:

https://ethiopian.portal.miningcadastre.com/MapPage.aspx?PageID=a16a9300-7c58-4f81-9e5c-97e13b22b0c6

Entering "Kefi" returns no entries for Kefi Gold and Copper.

BUT: Tulu Kapi Gold Mines presumably still owns the Mining License for Tulu Kapi. To do this, enter "TKGM" in "Search" and the license will be displayed. And this license is THE key.

Thanks @Robjm66 for your feedback.
I saw the newspaper report now. It may actually be a poorly researched report. Kefi Gold and Copper should correct this issue in an RNS - not just Q&A.

https://ethiopian.portal.miningcadastre.com/MapPage.aspx?PageID=a16a9300-7c58-4f81-9e5c-97e13b22b0c6

At "SEARCH" enter "TKGM":

MOM\LSML\81\2015
MOM\LSML\81\2015
Active
Tulu-Kapi Gold Mine share company (TKGM),
Ethiopia
Large Scale Mining License (LSML)
Application Date: 17/03/2015
Grant Date: 13/04/2015
Expiry Date: 12/04/2035
Resources: Gold and Basemetals
Area: 6.9793 Square Kilometre

The translation of the screenshot by @Aviator in the neighboring forum advfn is a fake (post June 23, 2022, 11:44 am). There is nothing from Kefi and certainly nothing from TGKM.
Link:
https://ibb.co/3WpXrVw

@Aviator translation (fake):
Mining licenses revoked by more than 9OO companies, including Kef Gold and Poly GCL, June 22, 2022

Here is the original text in Amharic:
????? ??? ? 900 ?????? ????? ???? ???? june 22, 2022 ???? ??? ??? ?? ???? ?????? ????? ?????? ???????
???? June 22, 2022

Here is the English translation of the original text:
Mining licenses revoked by more than 900 companies, including GCL June 22, 2022 Taken June 22, 2022

POLY-GCL is a Chinese Petroleum Company.

urai5

Exactly @Robjm66 I assess the security situation exactly the same. Of course, it is difficult to assess the situation from many thousands of kilometers away. But for me it is absolutely understandable that the government has to protect Tulu Kapi including the new settlement and the access roads with armed security forces (police, military).

I am convinced that the security audit is about, among other things, how reliably the promises made by the local government are actually implemented. the government of Ethiopia needs the mine: jobs, foreign exchange, proof of reliability for potential investors. Above all, well-paid jobs are the best prevention when it comes to young people not joining the rebels.

I hope this Link works:

https://assets.publishing.service.gov.uk/media/62751b74d3bf7f5e3d71e668/FCDO__TA__017_-_Ethiopia_Travel_Advice_Ed14.pdf

I have looked at the whole - extremely complicated - financing case again, including the Meccano. As of June/July 2022, no money is coming in. But around the end of June/beginning of July, the framework agreement (Ombrella agreement) - is like an umbrella over everything - should be signed by all partners. There, the exact terms and conditions are defined, which will lead to the actual financially effective contracts.

A condition for signing the framework agreement is the guarantee of security in the Tulu Kapi area and on the access roads. The Ethiopian government is responsible for this; in return, they also hold a share in Tulu Kapi. In addition, there is the construction of the access roads and the energy supply (power line).

The guarantee of safety must be legally confirmed by an independent audit. Now the question arises, what does it look like "on site"? The map with the travel warnings of the British government gives an indication. Here is version no. 14 from May 2022: Edition 14 (May 2022)

[url]https://assets.publishing.service.gov.uk/media/62751b74d3bf7f5e3d71e668/FCDO__TA__017_-_Ethiopia_Travel_Advice_Ed14.pdf[/url]

Tulu Kapi is north of the "E" of Ethiopia. Somewhere on the red/green dividing line. But I think the red zone refers to the Nek'emte - Gimbi - Gambela axis. The Oromo Liberation Army (OLA) operates there. It occasionally attacks the Ethiopian army and government. In terms of fighting power, it is not at all comparable to the Tigray People's Liberation Front (TPLF). It also does not have much support among the Oromo population.

With the ceasefire and the positive developments in the Tigray conflict, the Ethiopian (armed) security forces (police/army) should now have the potential to ensure the protection of Tulu Kapi and the supply axes.

urai5

Translated with www.DeepL.com/Translator (free version)