19th Jan 2015 10:18
LONDON (Alliance News) - Kefi Minerals PLC Monday said it will focus on developing and securing finance for the Tulu Kapi project in Ethiopia and completing a definitive feasibility study for the Jibal Qutman project in Saudi Arabia during 2015 as it announced it has secured a new strategic investor.
During the fourth quarter ended December 31, Kefi re-activated its mining license application at its wholly owned Tulu Kapi project, which should be approved in the first quarter, it said in a statement.
Kefi also updated the mineral resource at the project to probable ore reserves of 12.9 million tonnes at 2.41 grammes of gold per tonne to produce 1.0 million tonnes of gold. All in costs at the project are thought to be around USD844 per ounce, "well below global industry averages," said the company.
The company said it has received headline indicative terms for USD100 million of financing for Tulu Kapi from several financial institutions, which are being progressed.
"The finance plan is to fund all pre-development obligations and activities with equity capital, and that the investment required for development in the second half of 2015 will be optimised in mid-2015 and mostly financed by project-related debt," it said.
Kefi holds a 40% interest in the Jibal Qutman project in Saudi Arabia, where the company said an expanded inferred mineral resource of 22 million tonnes at 0.9 grammes of gold per tonne for a total of 633,461 ounces of gold, has defined a significant portion of material that is expected to be amenable to the heap leach processing.
Kefi is considering its options and said heap leaching could reduce capital expenditure and speed up the delivery of the project.
"The company is focusing on the possibility of an open cut heap leach operation at Jibal Qutman as a means of lowering capital requirements and speeding up the potential development timetable, and the possibility that any similar open pit discoveries in the district could be added as modular developments," said Kefi.
"This has been a transformational period for Kefi with progress achieved across both of our key projects as well as with new exploration targets... We remain on track for gold production in 2017 and generating significant value for shareholders," said Executive Chairman Harry Anagnostaras.
In addition, the company said it has sourced a new strategic investor, Goldfields Resources Fund, which is a new sub fund of Perth Global Funds PLC. The investor has committed to investing GBP3 million at a price range of 1.3 pence to 2.0 pence per share in order to acquire a minimum 15.7% stake in Kefi.
"The transaction is scheduled to close by February 27, 2015 and will be Goldfields Resources Fund's maiden investment," said the company.
Kefi said the investment from Goldfields builds upon the GBP1.9 million it raised in the fourth quarter of 2014 through a placing to fund the Tulu Kapi project.
Kefi shares were down 0.9% to 1.07 pence per share on Monday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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