10th Jul 2019 13:02
(Alliance News) - KEFI Minerals PLC said Wednesday it has made operational progress in the second quarter of 2019, with funding package for the Tulu Kapi Gold project in Ethiopia now fully sourced.
Shares in the gold explorer were 17% higher at 1.21 pence on Wednesday.
The project is now financed with a USD242.2 million funding package. The package includes up to USD68.0 million equity funding from the Ethiopian government, KEFI and private sector partner ANS Mining.
The remaining funds come from a USD14.2 million working capital facility and USD160 million in infrastructure finance.
In late June, Tulu Kapi reported several recent security incidents, including a minor robbery and fire at the project which led to the theft of some exploration equipment and damaged some drill core.
KEFI said that this incident caused minor financial losses, but no loss of data, and also necessitated the activation of strong measures and checks at the site before starting resettlement activities as well as commissioning an updated security report.
The company said that project development planning has remained focused on production start-up in mid-2021.
In addition, due to a higher gold price outlook, the project economics for the Tulu Kapi project have improved, with net present value for Wednesday's gold price at around USD1,400 per ounce at USD165 million at start of construction and USD249 million at start of production.
Meanwhile in Saudi Arabia, field work has started at the Hawiah Exploration licence within the Wadi Bidah Mineral District in mid-June.
Looking ahead for Tulu Kapi, KEFI has started construction contracts for off-site infrastructure for roads and power, and will start updating front end engineering and design for on-site infrastructure.
Also, KEFI will mobilise contractors for bulk earthworks, and for Hawiah the company will look to complete satellite multi-spectral and ground geophysical surveys, followed by scout drilling of a large copper-gold target.
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