Ethiopia’s Tulu Kapi gold mine gets bigger and nearer

KEFI Minerals announces results of an independent review of its Tulu Kapi project which is stated to further improve project economics.

Author: Lawrence Williams
Posted: Wednesday , 24 Sep 2014 

LONDON (MINEWEB) - 

KEFI Minerals (AIM: KEFI), which has now fully acquired the Tulu Kapi gold project in Ethiopia from Nyota Minerals and has been re-evaluating production plans for the project, reports  an independent verification of its revised mine plan.

The independent review, conducted by Snowden Mining Industry Consultants, incorporates an increased production target of 86,000 oz/year gold and KEFI says that this further improves the expected project economics. The company now anticipates reactivating the Tulu Kapi  Mining Licence Application next month with a view to commencing construction in H1 2015.

KEFI says it expects to report further milestones in the upcoming weeks including project cost estimates and independently verified ore reserves while at the same time actively working on securing project financing.

The company notes that the revised open pit development mine plan, which has been verified by Snowden, is based on a semi-selective mining approach, for targeted production of 86,000 oz/year over a 10.5 year initial mine life.  This will involve mining and processing 1.2 million tonne/year of ore at a grade of 2.4 g/tonne based on anestimated JORC Mineral Resource 18.4 million tonnes at 2.6 g/t for 1.5 million ounces of contained gold.  There may well be the prospect of a longer life through taking the mine underground and through further exploration in areas adjacent to the proposed mine site.

KEFI is now focused on finalising the independent verification of estimates of costs for capex, opex and closure, and the independent verification of ore reserves as well as on the assembly of a bank syndicate and agreement of indicative terms sheet for project finance, although raising finance on acceptable terms  may not be easy in the current gold price environment. In addition, in cooperation with the regulatory authorities, KEFI is continuing preparations for community resettlement in the first half of 2015.