Kefi Minerals, which took over an apparently moribund gold asset in Ethiopia after an equally moribund Nyota Minerals was unable to withstand the impact of the falling gold price back in 2012, has delivered yet another resource update for the project as part of an ongoing feasibility study.
Back when Nyota parted with Tulu Kapi the project was estimated to hold around 1.1 million ounces of gold at an average grade of 2.36 grams per tonne. Fast forward a couple of years and Kefi’s team on the ground have now managed to demonstrate that the project contains 1.62 million ounces at 2.67 grams per tonne in the indicated category.
That works out at a near 50 per cent increase in the resource base alongside a moderate increase in grade too. And that’s before the inferred ounces are even considered. The company has said it will update on that number in due course, but since the inferred ounces won’t figure in the mine plan as currently being designed, there seems to be no real urgency.
All told though, it’s a very good result and it’s small wonder that Harry Anagnostaras-Adams, Kefi’s well-known executive chairman, spoke of the update as providing further validation for the opportunity that the company identified back in 2012.
Harry lays the credit squarely at the door of Kefi’s exploration director Jeff Rayner who, despite a modest outward demeanour has been a real driving force behind the company’s development over the years.
Jeff’s always been happier out in the field than sitting in a suit presenting to investors, and now that this new resource update is out he’ll have plenty of opportunity to get down and dirty again by supervising the next stages of development.
As it stands, around 88 per cent of the new resource falls within the parameters of the proposed open pit at Tulu Kapi. The other 12 per cent represents a possible underground opportunity for the company, once the open pit has been mined out.
The plan now is for full-scale development work to start later this year with a view to commissioning at the end of 2016 and first production in 2017.
If that is indeed what happens, it will represent a remarkable turnaround for a project that was previously thought dead in the water.