KEFI Minerals on course to start production at Tulu Kapi in 2017

The Ethiopia-focused gold exploration and development outfit remained on track to fully drawdown its project finance for the Tulu Kapi gold project in the East African country by mid-2016.

That came as the mandates for its preferred banks to participate in the syndicate were being finalised and processed for formal approval.

During the period starting 1 October to date, Ethiopia’s government had also confirmed it would contribute between $15-20m in equity to the project.

It was estimated that Tulu Kapi would yield average annual production of 115,000 ounces of gold per year, during the first eight years, with all-in sustaining costs of between $730-741 per ounce.

That put the project among the lowest cost quartile of gold producers in the world, the company claimed.

At a discount rate of 8%, the project’s net present value was estimated at between $92 to $161m, based on the net after tax cash flows to equity from the Tulu Kapi open pit only.

Harry Anagnostaras-Adams, Executive Chairman of KEFI Minerals, commented: "This has been another active quarter for KEFI, which rounds off a very successful year. At our fully-permitted Tulu Kapi gold project, we have assembled a first-class syndicate of backers for our robust project, which remains scheduled to start production in 2017.”

Aim-listed Kefi Minerals also completed its Mining Licence Application for its 40%-owned gold and minerals joint-venture in Saudi Arabia, which was now being translated into Arabic before being submitted, Anagnostaras-Adams added.

As of 1535 GMT shares in the £6.19m market cap company were unchanged at 0.32p.