London-listed company, KEFI Minerals plc, has, in principle, reached an agreement on terms of $135m of project funding with Oryx Management for for the Tulu Kapi Gold Project in Western Ethiopia.
Once secured, the capital will be used to finance the development and running of all on-site infrastructure on Ethiopian gold project.
The planned financing package includes funding finance charges during a 30-month construction and production ramp-up period
The project is being implemented in partnership with the Ethiopian government. In accordance with a previous shareholders agreement, the Ethiopian government will fund the construction of all off-site infrastructure for the project.
KEFI executive chairman, Harry Anagnostaras-Adams, said: “KEFI has selected a development funding approach, as a start-up, than bank debt due to its longer 9-year tenure and repayments commencing 30 months after draw down.”
According to Kefi, the overall arrangement with Oryx entails a Build, Own, Operate and Transfer (BOOT) arrangement.
The project will also involve in the development of accommodation village, earthworks, water dams and tailing storage facility under an engineering, procurement, construction and management contract.
Under a mine services agreement, Ausdrill will supply and operate all the mining equipment for the project. Lycopodium Minerals will construct the processing plant under an engineering, procurement and construction contract.
Tulu Kapi project‘s mining licence was granted in April 2015.