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Pin to quick picksKefi Gold Regulatory News (KEFI)

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Tulu Kapi Mining Licence Tenure Confirmed to 2035

3 Nov 2021 07:00

RNS Number : 1320R
Kefi Gold and Copper PLC
03 November 2021
 

 

3 November 2021

 

KEFI Gold and Copper plc

("KEFI" or the "Company")

Tulu Kapi Mining Licence Tenure Confirmed to 2035

 

KEFI (AIM: KEFI) is pleased to report receipt on 2 November 2021 from the Ethiopian Ministry of Mines ("MoM") of formal confirmation that the mining licence for the Tulu Kapi Gold project ("Tulu Kapi" or the "Project"), held by Project company Tulu Kapi Gold Mines Share Company ("TKGM"), remains in good standing (for expiry per the terms of issuance in 2035) subject to TKGM's on-going compliance with the regulations and the MoM's requirement for TKGM to re-confirm by 31 January 2022 that it has procured the necessary Project finance. Subject to those conditions and a successful Project launch, the licence can be renewed by TKGM on expiry in 2035 should the Project prove successful in expanding ore reserves and mine life.

The Company has confirmed to the MoM its intention to launch key Project development activities and confirm the identified Project finance in December 2021. The Company remains focused on production commissioning in 2023. 

We are appreciative of the time and effort given to recent consultations by the MoM and also by the lead-financiers and contractors to TKGM, all of whom are supportive and have reiterated that they intend to proceed subject to normal conditions for drawdown.

The lead-finance parties have already been collaborating for over three years preparing the Project for launch, during which time technical and legal due diligence has been completed and, at the same time, we have arranged for several important Ethiopian Government documentary confirmations. These include the endorsement of historical pre-development expenditures, and the definitive development commitments regarding electricity-connection and new additional road access. During this period there have also been some pre-requisite policy proclamations by the relevant Ethiopian Government agencies to accommodate normal international mining project finance conditions, including the permission for bank accounts in major international financial centres, a project finance capital ratio of 70/30 debt/equity and permission for market-based private-sector borrowing costs.

This significant progress to date and the Project's general state of readiness places Tulu Kapi as the first-mover in modern Ethiopian large-scale mining. The Company notes that on the evening of 2 November 2021 the Ethiopian Federal Council of Ministers declared a nationwide State of Emergency in response to the ongoing Tigray conflict that has spread to a town on a route approximately 250 kilometres to the national capital Addis Ababa, but is approximately 1,000 kilometres from Tulu Kapi, which remains a quiet rural setting. The State of Emergency, which is to take effect immediately and to last for up to six months, allows the Government to impose certain security measures, including curfews and disrupting transport and communications services.

Whilst the geopolitical environment has proved more challenging than was envisaged at the time of the Company's arrival in Ethiopia in 2014, the opportunity and potential value from the Project is larger and more important than it has ever been.

The Company will report further material developments and make further progress reports as appropriate.

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$356 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 US$800-900/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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MSCEANFAEASFFFA
Date   Source Headline
23rd Jan 20237:00 amRNSTulu Kapi Gold Project Finance Update
10th Jan 20237:00 amRNSFive exploration licences granted in Saudi Arabia
9th Jan 20237:00 amRNSHawiah Mineral Resource increase
28th Nov 20227:00 amRNSInvestor Presentation 1 & 2 December in London
21st Nov 20227:00 amRNSAgreement of Tulu Kapi Gold Project Finance Plan
3rd Nov 20222:00 pmRNSEnd to hostilities in Northern Ethiopia
25th Oct 20227:00 amRNSQ3 2022 Operational Update
20th Oct 20227:44 amRNSSignificant Progress in Ethiopia
17th Oct 20227:00 amRNSRenewal of Jibal Qutman Exploration Licence K/144
17th Oct 20227:00 amRNSRenewal of Jibal Qutman Exploration Licence K/144
28th Sep 20227:00 amRNSInterim Results
22nd Sep 20227:00 amRNSTulu Kapi Workshop with Key Local Stakeholders
14th Sep 20227:00 amRNSIssue of Jibal Qutman Exploration Licences
12th Sep 20221:30 pmRNSCall for Ceasefire in Ethiopia by Rebel Group
31st Aug 20227:00 amRNSAfrica Down Under Presentation
16th Aug 20227:00 amRNSRegulatory Progress in Ethiopia and Saudi Arabia
3rd Aug 20227:00 amRNSRapid Progress in Saudi Arabia
13th Jul 20227:00 amRNSQ2 2022 Operational Update
12th Jul 20227:00 amRNSTwo new Saudi Arabian exploration licences granted
30th Jun 202211:23 amRNSResult of AGM
30th Jun 20229:45 amRNSAGM Statement and Board Change
30th Jun 20229:15 amRNSSigning of Tulu Kapi Financing Umbrella Agreement
29th Jun 20224:36 pmRNSPrice Monitoring Extension
27th Jun 202211:06 amRNSResponse to press reports
16th Jun 20227:00 amRNSSaudi Arabia Development Update
15th Jun 20227:00 amRNSEthiopia Development Update
6th Jun 20227:00 amRNSResults for the year ended 31 December 2021
31st May 20227:00 amRNSTotal Voting Rights
20th May 20227:00 amRNSUK Investor Show Presentation
19th May 20229:55 amRNSHolding(s) in Company
18th May 20229:25 amRNSHolding(s) in Company
17th May 202211:50 amRNSPlacing and Issue of Shares
12th May 20227:00 amRNSEthiopia Development Update
11th May 20227:00 amRNSIndaba Presentation
9th May 20227:00 amRNSSaudi Arabia Development Update
6th May 202211:20 amRNSTotal Voting Rights
27th Apr 20227:00 amRNSNotice of General Meeting
20th Apr 20227:00 amRNSFirm and Conditional Placing to raise £8 million
4th Apr 20229:17 amRNSUpdated Company Presentation for Investor Webinar
1st Apr 20227:40 amRNSQ1 2022 Operational Update
24th Mar 20227:00 amRNSSaudi Arabia Exploration Update
18th Mar 20227:01 amEQSEdison Investment Research Limited: KEFI Gold and Copper (KEFI): Hawiah developing rapidly behind Tulu Kapi
15th Mar 20227:00 amRNSInvestor Webinar and Updated Company Presentation
3rd Mar 20227:00 amRNSDevelopment Activities Recommence at Tulu Kapi
28th Feb 20227:00 amRNSRapid Progress Continues in Saudi Arabia
14th Feb 20227:00 amRNSTulu Kapi Gold Project Update
4th Feb 20221:57 pmRNSHolding(s) in Company
4th Feb 20227:00 amRNSTulu Kapi Project Update & Rescheduling of Webinar
3rd Feb 20223:07 pmRNSHolding(s) in Company
31st Jan 20223:46 pmRNSTotal Voting Rights

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