KEFI Gold and Copper PLC (AIM:KEFI, OTC:KFFLF) reported positive licencing progress on its Jibal Qutman joint venture in Saudi Arabia and said the venture had also been granted a further two exploration licences.
The joint venture, Gold and Minerals Ltd (G&M), received formal notification from the kingdom’s mining ministry that land issues, which had halted the project’s development, have been resolved - opening the way for the re-issuance of exploration licences as a precursor to granting the Jibal Qutman mining licence.
AIM-traded KEFI also said that the definitive feasibility study (DFS) for Jibal Qutman is being adjusted to focus on recovering more than 500,000 ounces of gold, rather than the originally envisaged 200,000 ounces, as the gold price outlook is considerably stronger than in 2015 when preliminary development studies were completed.
The DFS remains on-track for completion at the end of this year, with environmental permits targeted for the first quarter of 2023 and a mining licence application resubmission in early 2023. Project financing for Jibal Qutman is expected to be sourced and implemented within Saudi Arabia, KEFI said.
"We are extremely excited to announce the positive conclusion of the land access issue which has delayed the development of the Jibal Qutman project since 2016,” said KEFI executive chairman Harry Anagnostaras-Adams.
“This news, coupled with the KEFI Saudi Arabia team's early recommencement of studies in Q1 this year, paves the way for the fast-tracking of the project. With modern finance regulations already in place in-country along with strong Saudi capital markets, we can now realistically target bringing the mine into production in H2-2024, around the same time we expect to start production at Tulu Kapi in Ethiopia.”
G&M, which is 30% owned by KEFI and 70% by its partner Abdul Rahman Saad Al Rashid and Sons Ltd, has also been granted two further exploration licences: Abu Salal South and Jadib Al Qahtanah.
The new licences, awarded for an initial five-year term, bring the total number of exploration licences issued to seven, covering a total area of 462km2.
Abu Salal South hosts Volcanic Massive Sulphide mineralisation and is located 50km south of G&M’s discovery at Hawiah, while Jadib Al Qahtanah is situated about 45km east of the Mahad Ad Dahab mine, the principal historic Saudi gold and silver mine, in the Central Arabian Shield.
“The Abu Salal South EL [exploration licence] reinforces our position near our Hawiah discovery in the Wadi Bidah Metallogenic Belt which we believe will host multiple copper-zinc-gold mines,” said Anagnostaras-Adams. “And the Jadib Al Qahtanah EL expands our portfolio across the Kingdom into another area that has already demonstrated great potential for gold mining, hosting Saudi Arabia's principal historic gold and silver mine.”
Today’s announcement comes three weeks after KEFI said G&M had been granted two other exploration licences, Jibal Hillit and Qunnah, in Saudi Arabia.
READ: KEFI granted two new exploration licences in Saudi Arabia as pace of work accelerates
"We are delighted that the company is now positioned as a major explorer and developer in the Saudi Arabian shield," concluded Anagnostaras-Adams.