KEFI Gold and Copper plc (LON:KEFI), the gold exploration and development company with projects in the Democratic Republic of Ethiopia and the Kingdom of Saudi Arabia, has announced its unaudited interim results for the six months ended 30 June 2023.
The interim results for the Group encompass the activities of KEFI Minerals (Ethiopia) Ltd (“KME”), Tulu Kapi Gold Mines Share Company (“TKGM”) in Ethiopia, and Gold & Minerals Ltd (“GMCO”) in Saudi Arabia.
The Tulu Kapi Gold Project (“Tulu Kapi”) is currently 95% beneficially owned by KEFI through KEFI’s wholly owned subsidiary KME. The Hawiah Copper-Gold Project (“Hawiah”), the Jibal Qutman Gold Project (“Jibal Qutman”) and other Saudi projects are held by GMCO in which KEFI currently has a 26.8% interest.
Both TKGM and GMCO are being developed by KEFI and its partners as separate operating companies so that each can build a local organisation capable of developing and managing long-term production and exploration activities, as well as fully exploit future development opportunities.
Highlights
| · In Ethiopia, the Company plans to launch Tulu Kapi in Q4 2023. KEFI has now assembled, together with regional financiers, both the debt and equity development capital of US$320 million, in addition to which the mining contractor is supplying the required US$70 million mining fleet. TKGM is now essentially fully permitted, with funding assembled and ready for the final credit committee and board approvals of our banks and project investors. |
| · Final credit approval awaits from the Ethiopian central bank a formal confirmation of details of operation of offshore banking as has been agreed informally with TKGM and its project finance banks. This clarification complements and clarifies the policies and principles set out in recent published National Bank of Ethiopia Directives waiving strategic mining projects from foreign exchange control and capital controls. |
| · KME has lodged a formal protest with the Ethiopian Minister of Mines as a precursor to commencing administrative proceedings in respect of its long-standing proximal Exploration Licenses (“ELs”) surrounding the Tulu Kapi Mining Licence area, in order to continue exploration programmes and community development which have always complemented Tulu Kapi. During an overhaul of the title-regulatory system in 2022, these ELs were over-pegged by a Hong Kong shell company owned by a British Virgin Islands shell company. We are confident that this situation can be resolved satisfactorily. KME has also lodged applications for additional exploration licences elsewhere in Ethiopia. |
| · In Saudia Arabia, GMCO discoveries, Jibal Qutman and Hawiah, are in advanced stages, and are enjoying positive regulatory support as preferred development plans are determined. |
| · In early 2023, KEFI announced an updated Hawiah Mineral Resource Estimate (“MRE”) of 29.0 million tonnes at 0.89% copper, 0.94% zinc, 0.67g/t gold and 10.1g/t silver and a maiden MRE for the nearby Al Godeyer Project. |
| · GMCO has one of the largest exploration teams in Saudi Arabia and holds 15 ELs, providing extensive potential for further discoveries near Jibal Qutman and Hawiah, as well as two other targeted project areas. GMCO has six drill rigs active, mainly conducting in-fill drilling, but also doing some extensional drilling on current resources and exploration drilling. |
| · Kefi’s management considers the Company to have reached a key turning point with the imminent planned start of construction at Tulu Kapi. This is the beginning of a series of major steps the Company is planning with the key project development sequencing as follows: |
| – 2023 launch Tulu Kapi open-pit in Ethiopia for first production end-2025; |
| – 2024 launch Jibal Qutman Gold open-pit in Saudi Arabia for first production end-2025; |
| – 2025 launch of the Hawiah Copper-Gold open-pit in Saudi Arabia for first production 2027; and |
| – 2026 and thereafter launch of underground mine development at Tulu Kapi and at Hawiah for first production two years later. |
Working Capital
KEFI Gold and Copper has working capital in place to underpin its planned runway to the intended closing of the Tulu Kapi project finance and launch in the coming months. This follows the Company’s repayment of all debts in June 2023 upon completing an equity placing that raised gross proceeds of £7.2 million via a £5.50 million Firm Placing, £0.70 million Conditional Subscription, £0.24 million Retail Offer and £0.75 million issue of Remuneration Shares in lieu of cash to senior executives. The issue of the Conditional Subscription, Retail Offer and Remuneration Shares were approved at the Company’s Annual General Meeting on 30 June 2023 and these shares have subsequently been issued.
Board and Management Team
KEFI welcomed Non-Executive Director Dr Alistair Clark to the Board on the 1 July 2023, who is a pre-eminent authority on environmental, social, and corporate governance matters. From 2001 until 2021, Dr Clark was Managing Director, Environment and Sustainability Department, at the European Bank for Reconstruction and Development (“EBRD”). KEFI’s recently appointed Chief Operating Officer, Eddy Solbrandt, has assumed formal responsibility for all project development activities with operational line management of the Company’s majority-owned projects and provides support and advice for its minority-owned projects. The in-country project teams have been expanded under Managing Directors Theron Brand in TKGM in Ethiopia and Brian Hosking in GMCO in Saudi Arabia. General Manager Corporate Development, Rob Williams, has switched from part-time to full-time and the Tulu Kapi Project development execution team is now being assembled within TKGM and Lycopodium. Investor relations arrangements have also been enhanced to capture the heightened interest from regional, corporate and sector specialist international investors.
Quarterly Webinar
KEFI Gold and Copper will host its next quarterly investor webinar in London in late October 2023, the details of which will be announced in due course.
