KEFI Minerals awards $300m contract to African Mining for Tulu Kapi Gold project in Ethiopia

15 October 2015 (Last Updated October 15th, 2015 18:30)

UK-based KEFI Minerals has awarded a $300m contract to Ausdrill’s wholly owned subsidiary African Mining Services (AMS) for its Tulu Kapi Gold project in Ethiopia.

Mining

UK-based KEFI Minerals has awarded a $300m contract to Ausdrill's wholly owned subsidiary African Mining Services (AMS) for its Tulu Kapi Gold project in Ethiopia.

The mine is situated 28km east of Ayra-Gulliso town in the state of Oromia and lies in the Tulu Kapi-Ankore licence area and has a surface area of 8.44km².

AMS has been appointed as a preferred contractor for the mine establishment and operation, and will be responsible for certain pre-mining earthworks, as well as the life-of-open-pit mining operation.

KEFI said it would make direct purchases of certain key input costs such as explosives and fuel.

The mining company and AMS will jointly optimise the detailed operating plan for the benefit of the project.

According to KEFI, peak funding requirements are estimated at around $120m, with funds sourced from a combination of debt and gold streaming of $100m, along with $20m project-level equity.

"Peak funding requirements are estimated at around $120m."

KEFI Minerals chief operating officer Wayne Nicoletto said: "Today's appointment of industry stalwart Ausdrill/AMS as preferred mining contractor is a profoundly important step forward in setting up Tulu Kapi both for development and for long-term operation."

The Tulu Kapi gold project received mining licence in April and is being progressed towards development.

The company also selected Sedgman as the preferred contractor for plant construction and start-up for project.

To be built at a cost of $63m, the plant will have estimated capacity of up to 1.7 million tonnes a year.


Image: Sedgman will provide services including detailed equipment specification and procurement for the mine project. Photo: courtesy of duron123/ FreeDigitalPhotos.net.