KEFI Minerals on course to start production at Tulu Kapi in 2017

30th Dec 2015 15:09

(ShareCast News) - KEFI Minerals continued to be course to begin production at its Ethiopian gold project in 2017, thus ending the year in a strong position, the company told investors in an operational update.The Ethiopia-focused gold exploration and development outfit remained on track to fully drawdown its project finance for the Tulu Kapi gold project in the East African country by mid-2016.That came as the mandates for its preferred banks to participate in the syndicate were being finalised and processed for formal approval.During the period starting 1 October to date, Ethiopia's government had also confirmed it would contribute between $15-20m in equity to the project.It was estimated that Tulu Kapi would yield average annual production of 115,000 ounces of gold per year, during the first eight years, with all-in sustaining costs of between $730-741 per ounce.That put the project among the lowest cost quartile of gold producers in the world, the company claimed.At a discount rate of 8%, the project's net present value was estimated at between $92 to $161m, based on the net after tax cash flows to equity from the Tulu Kapi open pit only.Harry Anagnostaras-Adams, Executive Chairman of KEFI Minerals, commented: "This has been another active quarter for KEFI, which rounds off a very successful year. At our fully-permitted Tulu Kapi gold project, we have assembled a first-class syndicate of backers for our robust project, which remains scheduled to start production in 2017."Aim-listed Kefi Minerals also completed its Mining Licence Application for its 40%-owned gold and minerals joint-venture in Saudi Arabia, which was now being translated into Arabic before being submitted, Anagnostaras-Adams added.As of 1535 GMT shares in the £6.19m market cap company were unchanged at 0.32p.