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KEFI Gold and Copper powers ahead with economic studies and development work in Ethiopia and Saudi Arabia

Published 25/10/2022, 08:32
Updated 25/10/2022, 09:11
© Reuters.  KEFI Gold and Copper powers ahead with economic studies and development work in Ethiopia and Saudi Arabia

© Reuters. KEFI Gold and Copper powers ahead with economic studies and development work in Ethiopia and Saudi Arabia

KEFI Gold and Copper PLC (AIM:KEFI, OTC:KFFLF) has released a quarterly operational update encompassing the activities of KEFI Minerals (Ethiopia) Ltd and Tulu Kapi Gold Mines Share Company in Ethiopia, and Gold & Minerals Ltd in Saudi Arabia.

"The improvement of our working environments in both Ethiopia and Saudi Arabia means that we now have a rapidly advancing gold project in each country,” said Harry Anagnostaras-Adams, executive chairman of KEFI in the statement.

“Both Tulu Kapi and Jibal Qutman are heading for commissioning in 2024 and steady-state production from 2025 and have 95% of their development financing needs being met at the subsidiary levels. We are completing the preliminary feasibility study on our copper-gold volcanic massive sulphide discovery at Hawiah in Saudi Arabia which is expected in the fourth quarter of 2022," he added.

Since acquiring Tulu Kapi Gold Mines (TKGM) in 2014, KEFI has completed an extensive technical re-design of the project, including independent reviews by leading international experts. During the third quarter TKGM continued to prepare for project launch, which is now lining up for year-end as security conditions continue to improve, documentation continues to be agreed within the project syndicate and the other normal conditions precedent continue to be satisfied.

An updated project finance plan was distributed within the existing syndicate and is due to be approved mid-November 2022. Subject to senior lender consent, this financing plan now caters for the start-up of the underground mine as well as the open-pit mine.

All-in sustaining costs at Tulu Kapi are expected to run at US$970 per ounce, and the mine is expected to generate annual EBITDA US$127mln over its first seven years.

In Saudi Arabia, meanwhile, Gold & Minerals (G&M) is rapidly becoming a leading explorer/developer/producer in the fast-emerging Saudi minerals sector, with the largest exploration team in the country.

It has two major projects advancing towards development, Hawiah, which is at the preliminary feasibility stage; and Jibal Qutman, which is at the definitive feasibility stage.

G&M's growth has coincided with the Saudi Government's widely publicised recent initiatives to welcome international expertise and fast-track the growth of its mining sector.

Jibal Qutman is currently the subject of a 500,000-plus ounce production plan for extraction over 10 years. The project remains on track to proceed, with financing and mining licence submission in early 2023. Subject to regulatory approvals and financing, Jibal Qutman may be commissioning gold production around the same time as targeted for Tulu Kapi in Ethiopia at the end of 2024.

Hawiah was discovered in September 2019 and now ranks in the top three base metal projects in Saudi Arabia, and in the top 15% VMS projects worldwide.

A three-year 42,000 metre drilling programme has delineated a resource of 24.9mln tonnes at 0.90% copper, 0.85% zinc, 0.62 grams per tonne gold and 9.8 grams silver.

The Hawiah preliminary feasibility study is scheduled for completion by end of 2022.

Recent drilling at Hawiah is expected to upgrade and increase resources which, in gold-equivalent terms, are already approximately those of Tulu Kapi and Jibal Qutman combined before any further resource uplift.

The company has also acquired new projects in Saudi Arabia at Abu Salal South, Jadib Al Qahtanah, Jabal Hillit, and Qunnah.

KEFI's beneficial interest in gold-equivalent mineral resources has grown from 1.2mln ounces in mid-2020 to 2.1mln ounces at the end of 2021, with further growth anticipated in 2022 and subsequent years.

Read more on Proactive Investors UK

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