KEFI Gold and Copper PLC (AIM:KEFI, OTC:KFFLF) is close to finalising a long-awaited $320 million financing package for its Tulu Kapi gold project in Ethiopia, paving the way for construction to begin and full production by late 2027.
The company said the funding syndicate, which includes two African development banks, contractors and local investors, is now at the final approval stage.
Once complete, this will mark the first internationally project-financed mine in Ethiopia, a milestone for the country’s growing mining sector.
Tulu Kapi is expected to deliver strong returns. At a gold price of $3,000 per ounce, the project could generate net operating cash flow of up to $304 million in its first full year, more than enough to repay the planned $240 million of debt.
Over its initial life, the mine is forecast to produce around 164,000 ounces of gold per year, with total net cash flow to shareholders of up to $1.6 billion.
KEFI plans to retain an interest of around 80% in Tulu Kapi. The open-pit mine is designed to international standards and is located in a stable rural area with strong community and government support. Underground development is also planned, with early-stage assessments pointing to significant high-grade potential.
Across the Red Sea in Saudi Arabia, KEFI’s joint venture GMCO has continued to make progress at the Hawiah and Jibal Qutman projects.
However, KEFI has cut its stake in GMCO from 25% to 15%, citing the high cost of maintaining its holding through equity issuance. A strategic review is underway, with offers for the Saudi assets under discussion.
KEFI posted a loss of £5.2 million for 2024, narrowing from £7.9 million in the previous year. The company’s current market capitalisation of around £55 million remains a fraction of its internal valuation of Tulu Kapi, which it estimates at over £800 million.
Chairman Harry Anagnostaras-Adams said KEFI was entering “an opportune moment” as rising metal prices and improved host country conditions combine with years of groundwork. “We are now seizing the opportunities,” he said.