Name of the Project
Tulu Kapi gold project.

Location
Western Ethiopia.

Project Owner/s
London-listed Kefi Gold and Copper (formerly KEFI Minerals) will own 80% of the exploration and holding company for the government of Ethiopia, KME, which, in turn, will own 56% of Tulu Kapi Gold Mines Share Company (TKGM), thus bestowing Kefi with a 45% beneficial interest in the project.

Project Description
Tulu Kapi has an ore reserve estimate of 15.4-million tonnes at 2.1 g/t gold for 1.1-million ounces of gold.

Openpit gold production is estimated at 140 000 oz/y over a seven-year mine life.

Total life-of-mine production is estimated at 980 000 oz.

The conventional openpit mining operation will include a carbon-in-leach processing plant. The mine will be connected to Ethiopia’s electricity grid through a new, 47-km-long, 132 kV dedicated power line relatively close to the country’s major hydropower-generation source. An emergency diesel power plant will also be installed to provide emergency backup power for critical process equipment in the event of grid power failure.

A preliminary economic assessment has indicated the economic attractiveness of mining the underground deposit adjacent to the Tulu Kapi openpit after the startup of the openpit and the repaying of project debts through positive cash flows.

Potential Job Creation
The project is expected to create about 1 000 direct jobs and 5 000 to 10 000 indirect jobs, with foreign direct investment of about $500-million, including historical investment.

Net Present Value/Internal Rate of Return
At gold prices of between $3 000/oz and $5 000/oz, the net present value of Tulu Kapi at the start of construction is between $710-million and $1.6-billion.

Once in production, Tulu Kapi is set to generate between $1.9-billion and $3.6-billion of net operating capital over seven years, or between $284-million and $526-million a year. This equates to an internal rate of return of between 112% and 200%.

Capital Expenditure
Kefi expects the full development to cost $340-million. The total project cost is about $500-million after taking into account that the mining contractor finances the mining fleet of $60-million and historical expenditure is more than $100-million.

Planned Start/End Date
The company expects to commission the project in late 2027 and reach full production in 2028.

Latest Developments
Kefi Gold and Copper has reached key milestones towards commissioning the project.

Chief among the achievements in the past month are the finalisation of final project contracting packages covering all capital expenditure and 50% of seven-year operational expenditure.

As the lead design and construction contractor for the processing plant and all on-site infrastructure, Lycopodium has ramped up its field activities.

The financial closure process has been in preparation for many years, with $240-million in debt having been secured, $100-million in equity investment, $60-million for mining fleet investment through a mining services agreement, and $30-million in nondilutive capital for contingencies and growth in Ethiopia, as well as Saudi Arabia.

Owing to the endeavour being a first-mover transaction for Ethiopia and the project's secured lenders providing about 70% of the $340-million development capital, all detailed definitive documentation has had to be approved by these major African development banks – one being well embedded in Ethiopia, and the other being Africa's leading mining financier.

Kefi founder and executive chairperson Harry Anagnostaras-Adams has said the successful funding of the high-grade and high-recovery Tulu Kapi project has taken many years of intense effort as the first-mover in the country amid a changing and often challenging geopolitical landscape.

The current development phase is focused on community resettlement and plant procurement, which will be followed by earthworks and installation of infrastructure. Openpit mining will start six months before commissioning of the processing plant.

Key Contractors, Suppliers and Consultants
Principal contractors: Lycopodium (process plant design and construction); PW Mining; the Ethiopian Electric Power Company; and the Ethiopian Roads Authority.

Contact Details for Project Information
Kefi Gold and Copper, tel +90 232 381 9431, fax +90 232 381 9071 or email info@kefi-minerals.com.