KEFI Gold and Copper Interim Results Show Progress on Tulu Kapi and Saudi Projects

KEFI’s H1 2025: Financing within touching distance, projects advancing on two fronts

KEFI Gold and Copper has published its unaudited interim results for the six months to 30 June 2025. The headline is clear: Tulu Kapi is nearing the pointy end of financing and mobilisation, while Saudi assets continue to scale up. There is no revenue yet, but costs are down, the balance sheet is stronger, and the path to project build is set out with dates and numbers.

Tulu Kapi financing – US$340 million capex, bank debt anchored, equity assembling

KEFI confirms the updated Tulu Kapi capital budget of US$340 million (up from US$320 million in 2023). The plan remains US$240 million of senior project debt and US$100 million of equity-risk capital, with the equity almost entirely at the subsidiary level. That last point matters because it limits dilution at the plc level.

• Debt facility: US$240 million, formally offered by two co-lenders, accepted by KEFI and its subs, and expected to be signed within the coming week. Facility and account docs will follow alongside equity close.
• Equity-risk capital: US$100 million targeted. Secured or already invested components include US$20 million from the Government of Ethiopia, US$10 million already invested by KEFI, and c.US$10 million of KEFI share participation post-closing for fees and costs. The remaining US$60 million is being finalised with conditional proposals exceeding the requirement.

The equity toolkit will include Ethiopian investor preference shares (the “KEFI Ethio Prefs”), a gold prepayment or streaming note from a specialist fund, and ordinary shares in Ethiopian subsidiaries priced off TKGM’s funded project value. Final terms will be disclosed on commitment.

Construction contracts are finalised and ready to sign upon equity drawdown. KEFI expects to begin the full development programme in October 2025, sequencing signatures through to issuing a Notice to Proceed to the principal contractor, Lycopodium. Standard conditions apply, including change of control and government confirmations. In the interim, site works continue using working capital facilities.

Project economics and build schedule – what the numbers imply

Operating metrics are unchanged from recent guidance: all-in sustaining costs around US$1,100/oz and first full year production of 160koz from the open pit. Year 1 net operating cash flow is projected at c.US$200 million at US$2,500/oz gold and c.US$300 million at US$3,500/oz, processing at nameplate capacity.

On timing, the main mining fleet is planned for early 2026, with initial open-pit mining targeted to start in mid-2027. Underground development would then lift output toward a longer-term target of 200,000 ounces per year. The project is designed to international ESG standards and has strong local alignment, including government participation.

Site readiness – roads, power and resettlement in motion

• Roads: A new all-weather road is nearing completion; a heavy-load access road is due to start construction within two months.
• Power: Procurement for the grid connection is complete, with mobilisation underway.
• Community: The Resettlement Action Plan is being implemented by local government with TKGM support. Phased compensation aims to meet international standards and smooth delivery.

Saudi portfolio update – bigger resources at Hawiah and Jibal Qutman, more ground won

KEFI’s 15%-owned GMCO joint venture continues to deliver scale in Saudi Arabia’s VMS and gold belts.

• Hawiah and Al Godeyer: On 15 February 2025, Hawiah’s Mineral Resource Estimate increased by 25% to 36.2 Mt at 0.82% copper, 0.85% zinc, 0.64 g/t gold and 10.0 g/t silver. The Umm Hijlan EL grant nearly doubles the targeted strike length, with drilling ongoing.
• Jibal Qutman: Mineral Resources upgraded to 37.0 Mt at 0.76 g/t gold, containing 902,000 ounces (including 748,000 ounces in the Indicated category). Initial development is expected to be approved during 2025, focused on oxide open pits and CIL processing.
• Licences and JV: The GMCO/ARTAR-Hancock JV won the Al Hajar North licence tender. GMCO-led exploration areas expanded from 1,300 km2 to more than 2,200 km2, with a new 910 km2 EL over the adjacent Wadi Shwas belt.

Why it matters: these upgrades and licence wins broaden KEFI’s medium-term growth pipeline beyond Tulu Kapi. GMCO is carried at nil book value under KEFI’s conservative accounting, leaving upside not reflected in the balance sheet.

Financials at a glance – leaner cost base, stronger equity, still pre‑revenue

Governance and approvals – who signs what, and when

The boards of both co-lending banks and the relevant group companies have approved the project loan facilities and are expected to sign the formal commitment within a week. Financing documents carry standard conditions precedent, including government approvals, and will be signed in sequence through to Notice to Proceed. A shareholder meeting is expected in November 2025 to approve elements of the debt package under KEFI’s Articles.

Positives, risks and near-term catalysts

What looks positive

• Debt package at US$240 million is essentially credit‑approved and near signing.
• Equity-risk capital proposals exceed the US$100 million required, with a material US$20 million from the Government of Ethiopia already committed.
• Costs trimmed year-on-year and net assets up to £41 million, aided by equity raises and project investment.
• Operational groundwork advancing at site, de-risking the October 2025 development start.
• Saudi assets are growing in scale and optionality, with larger resources and new exploration ground.

Key risks to watch

• Execution risk on financing close – multiple instruments, government confirmations and CPs need to line up in sequence.
• Schedule risk – October 2025 start and mid‑2027 mining target will rely on timely equity drawdown and contractor mobilisation.
• Resettlement and ESG delivery – critical to maintain international standards and local support.
• Going concern – the company notes a material uncertainty until project financing is completed, although directors expect this to be resolved.

Catalysts ahead

• Formal signing of the US$240 million loan facilities.
• Announcement of definitive equity-risk capital commitments and instrument breakdown.
• Shareholder meeting in November 2025 to approve debt elements.
• Notice to Proceed to Lycopodium and on-the-ground development milestones.

My take: a financing story nearing the finish line, with growth optionality in Saudi

For a pre‑revenue developer, KEFI’s update ticks the boxes that matter: debt approvals, equity options, signed construction contracts ready on equity drawdown, and site works moving. The small capex uplift to US$340 million is unsurprising in today’s market. The scale of projected cash flow at US$2,500/oz to US$3,500/oz gold underlines why the lenders and the government are leaning in.

The risks are not trivial – execution through to first mining is a multi‑year journey and the going concern flag remains until the financing is sealed. But the mechanics are now laid out with dates and amounts, and the Saudi portfolio adds a meaningful second leg in copper, gold, zinc and silver. If KEFI converts the near‑term financing catalysts as guided, 2026-2027 could mark the transition from promise to production.

Further information is available at kefi-goldandcopper.com.