KEFI (AIM: KEFI) has announced the introduction of BCM Group (BCM) as a project syndicate member.
BCM, a +50-year-old company, was an early mover from Western Australia into African mining, is based in Ghana and has several mining services contracts in projects in which it has an ownership interest.
At project finance signing, BCM has confirmed its intention to contribute US$23M of pre production costs of equity risk notes, repayable in cash or convertible post commencement of production at Tulu Kapi.
KEFI Founder and executive chairman, Harry Anagnostaras-Adams commented, “We progress towards launch of major works at the Tulu Kapi Gold Project at what is a very propitious moment in time. At a US$3,000 per oz gold price, net operating cash flow after royalties and taxes for the first year of production is estimated at c. US$304M, of which US$240M would repay all project debt.”
These arrangements would fulfil all the development funding requirements of the project against the longstanding budget of US$320M, which the company is currently reconfirming with all relevant suppliers and service providers, particularly the fixed price lump sum elements.
Following this intended arrangement with BCM, the company now has sufficient demand within the project financing syndicate, which reinforces KEFI’s confidence about closing the full financing. Once costings and final participations are finalized, KEFI will finalize the scheduling of drawdown and disbursement by respective currency and party.
“It is a great time to launch such a high-grade/high-recovery open pit gold mine in rapidly growing Ethiopia, and we will now also push for this development be followed quickly by the underground mine development at Tulu Kapi. Likewise in Saudi Arabia, under the GMCO joint venture with KEFI’s partner leading Saudi conglomerate ARTAR, we will push the development in the short term of the initial open pit gold mine projects at Jibal Qutman and Hawiah.” Added Mr. Anagnostaras-Adams.
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