KEFI Minerals plc (LON:KEFI) said in its quarterly operations update that it expects strong support for the Tulu Kapi gold project to be reinforced by the Ethiopian government following the appointment of Dr Abiy Ahmed as the country’s new prime minister earlier this week.
Abiy Ahmed was previously vice president of the regional government for Oromia, where Tulu Kapi is located.
“KEFI expects that the government will maintain its determination for Ethiopia to remain within the world's top 10 growth countries, where it has been ranked for a remarkable 15 years in a row,” the mine developer said in a statement.
“The company also expects that the strong support for our project will now be further reinforced.”
It added: “Throughout the recent government transition, KEFI and joint government-KEFI company TKGM have been maintaining communications with the ministries and government agencies at federal, regional, zonal and local levels and we can now re-intensify the collaboration.”
KEFI also noted ‘good progress’ with the financing element of the project, highlighting that during the quarter a full consortium was assembled to raise all development funding at project level – a US$150mln bond issue is planned, alongside an anticipated US$40mln of project level equity (including a US$20mln government commitment).
Operationally, a number of ‘pre-works’ programmes are underway including work related to road and power infrastructure.
Development work is due to scale up after the wet season (June-September), and KEFI noted that it expects project commissioning will start by the end of 2019.
In the meantime, the company is planning to start what it describes as an “aggressive” exploration programme in the second half of the year – as it looks to get working on its recently expanded footprint, which is due to span some 3,000 square kilometres.
The plan is to unearth mineralisation in satellite deposits from which ore can be trucked to Tulu Kapi.