Name and Location
Tulu Kapi gold project, Ethiopia.

Client
Kefi Minerals.

Project Description
Tulu Kapi has a current mineral resource estimated at 20.2-million tonnes grading at 2.65 g/t of gold, and a reserve estimate of 15.5-million tonnes at 2.12 g/t of gold.

The project’s definitive feasibility study (DFS) is based on a conventional openpit drill-and-blast, and load-and-haul mining operation on 7.5 m benches, as well as a 1.5-million-tonne-a year carbon-in-leach processing plant, with gold recoveries averaging 91.5%.

Using semiselective mining techniques and 120 t backhoe configured excavators, it is planned that process ore will be mined above a cutoff of 0.9 g/t of gold for the first ten years, with ore mined between 0.5 g/t, and 0.9 g/t of gold being stockpiled for later processing.

The project is expected to produce 105 000 oz of gold over its ten-year mine life.

Net Present Value/Internal Rate of Return
The project has an after-tax net present value (NPV) at the start of construction of $147-million, at an 8% discount rate, based on unleveraged cash flows, a gold price of $1 250/oz and an after-tax discount rate of 8%.

Value
Total capital for the project is estimated at $129.6-million.

Duration
Commissioning of the processing plant is expected to start in the fourth quarter of 2016, with gold production expected to start in 2017.

Latest Developments
Australia-based Sedgman will start the front-end engineering design stage of the $63-million, 1.5-million- to 1.7-million-tonne-a-year plant at the Tulu Kapi mine in the current quarter.

Sedgman has been selected as the preferred plant construction engineering, procurement and construction management contractor for the 105 000-oz-a-year gold operation.

The contract includes a fixed-price lump sum contract for construction, including performance guarantees, with Kefi’s peak funding requirement maintained at $120-million.

The gold exploration and development company’s planned sources of funding also remain unchanged, being a combination of debt and gold streaming finance of $100-million and project-level equity of $20-million from the Ethiopia government.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Kefi Minerals (Ethiopia), tel +251 11647 9976/73 or fax +251 11647 9975.