Kefi Seeks to Resolve Legal Issues ahead of Tulu Kapi Gold Project Launch

ADDIS ABABA – Officials of Kefi Gold and Copper Plc are holding a meeting with the government of Ethiopia in a bid to kickstart its gold mining project in Tulu Kapi, Oromia Region.

The firm, formerly Kefi Minerals plc, is yet to start the project it operates via a joint venture Tulu Kapi Gold Mines S.C., nearly 9 years after the company secured the mining agreement.

Its officials are now saying “only a few” things, especially regulatory, remain to be dealt with ahead of launching the Industrial Gold Mining Project.

The workshop, which started on Wednesday, is aimed at finalizing remaining consents and approvals paving the way to commence activities on the ground, the mining firm said in a statement.

Executives of Kefi and representatives of international financiers of the project as well as officials from the Ministry of Mines (MoMs), National Bank of Ethiopia (NBE), and Ministry of Finance are attending the meeting.

It comes months after authorities issued a warning of possible license revocation over Kefi’s delay to present $80 million equity capital for the project. They also granted a final extension to Kefi, requiring the fund to be deposited in a bank recognized and validated by the NBE.

Kefi says an agreement has been reached with lenders on a financing plan for the c.US$320 million funding of the project “in principle”, so that “draft definitive agreements could be finalized for approval by syndicate members and regulators.”

‘All but a few issues resolved’

“Our agenda in this workshop,” said Kefi’s Chairman Harry Anagnostaras-Adams, “is to resolve the few remaining regulatory and legal issues so that the project can be financed in an internationally standard manner for the mining industry.”

“We have agreed on many things over the years and there are not many left,” said the chairman.

“We are all meeting to hopefully resolve them now and finish all project preparations quickly – regulatory approvals, legal documents, security protection of our people and project and preparation of the community,” he added.

Government officials, who expected the company to start full production in 2025, say the issue of capital equity remains the major unresolved issue regarding the project.

“The regulatory issues remaining to be resolved are a very small subset of the many matters resolved already,” said Minister of Mines Habtamu Tegene in his remarks at the meeting.

“The remaining matters include central bank procedures for the project bank accounts to service the foreign debt and equity financing provided,” said the Minister.

“Other regulatory matters include the direct arrangements between the banks and mine and other Ministries to provide some protection to the banks,” he added.

The Tulu Kapi project, located approximately 360 kilometers southwest of Addis Ababa, includes an ore reserve of over 1.1 million ounces and mineral resources totaling 1.7 million ounces of gold.

Kefi says the Project is Ethiopia’s only ‘ready-to-start’ industrial mining project, making it the country’s first large-scale mining project for some 30 years.

The mining firm expects the project to generate over $250 million in annual export revenue, employing approximately 1,000 local people in 12 months.