KEFI Minerals positive about talks with Ethiopian Government

Gold exploration and development company KEFI Minerals provided an update on its discussions with the Government of Ethiopia on Tuesday, over various aspects involved in formalising the agreements for the development of the Tulu Kapi Gold Project.

The AIM-traded firm confirmed that in October, the government announced the formation of Ethiopian Mines, Petroleum and Bio-Fuel Corporation, which will be the Ethiopian investing entity.

It said negotiations with the Development Bank of Ethiopia were at an advanced stage and now awaited the appointment of the selected co-lender.

“The government's recent policy directive requiring a maximum 50% debt gearing policy for new projects is considered consistent with KEFI's plans because clarifications received from the National Bank of Ethiopia indicate that historic spend on the project of approximately $60m counts as equity in the calculation,2 KEFI’s board said in a statement.

“The Ethiopian Government experts and the project's social licence advisers are ensuring that calculations and plans comply with Ethiopian law and IFC principles,” it added.

KEFI said it is playing a “supporting role” to the government's efforts and is committed to assist where it can.