Update: More gold faster and cheaper
KEFI’s DFS on Tulu Kapi was based on a conventional owner-operator model to estimate costs from first principles (see page 2). However, to minimise initial capex, management then invited final bids from fixed-price plant building and mining contractors. In collaboration with these, it has also been able to announce a 25% expansion of the proposed processing rate to 1.5Mtpa, such that KEFI shares now offer investors an IRR of 38.6% in sterling terms over 12 years (vs 25.9% over 17 years previously). Significantly, KEFI has also confirmed that the Ethiopian government is planning to proceed with a US$20m investment at the project subsidiary level at a valuation related toTulu Kapi’s NPV at the current gold price.
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