REG - Kefi Gold and Copper - US$240 Million Debt Offering Signed

KEFI Gold and CopperAnnouncement

Mon 15:00

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RNS Number : 0754E  Kefi Gold and Copper PLC  20 October 2025

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the Company's obligations under Article 17 of
MAR.

 

20 October 2025

KEFI Gold and Copper plc

("KEFI" or the "Company")

US$240 Million Debt Offering Signed

KEFI (AIM: KEFI), a gold and copper exploration and development company
focused on the Arabian-Nubian Shield with a pipeline of projects in the
Federal Democratic Republic of Ethiopia, and the Kingdom of Saudi Arabia, is
pleased to provide an update on the continuing progress of the Company's
high-grade/high-recovery Tulu Kapi Gold Project (the "Project" or "TKGM").

Highlights

·    US$240 million Project debt capital has been formally offered and
accepted, having been signed by both co-lenders and by KEFI on behalf of its
group of companies.

·    Various construction projects are underway funded by working capital
and facilities, all as part of the current launch of the full US$340 million
development project.

·    Focus is now on closing the equity-risk capital, for which
commitments and proposals received for investment at the Project level exceed
the required US$100 million, primarily from local investors and African
specialist funds.

·    The project has been designed to take into account both local and
international ESG (environmental, social, and governance) standards and
alignment with local stakeholders, including the community, government, and
private sectors. The project is seen as a showcase for international project
finance in Ethiopia, contributing to the country's growing gold sector.

Project Update

·    Debt capital signed: The co-lenders and KEFI have signed the US$240
million debt offering.

·    Site preparations progress on schedule with various construction
projects advancing:

o  Housing contractor for resettling households has been mobilised to
construct the replacement housing selected for the local community.

o  The Ethiopian Roads Authority is installing new all-weather site access
roads which will more than halve travel time from the highway.

o  The Ethiopian Electric Power Company is connecting the site to the mains
grid generation facilities at the Grand Ethiopian Renaissance Dam ("GERD"),
the largest hydro-electric scheme in Africa. Tulu Kapi is the closest
industrial-scale electricity consumer of the GERD - excellent for reliability
of low-cost "green energy".

o  The process plant contractor has been at site planning his security and
logistics for delivery of plant components the procurement of which has
started. The plant is designed to highest international standards, and its
footprint is laid out to accommodate expansion for production uplift from the
planned underground mine after the open pit has settled down.

o  Mining contractors have been at site planning the mining operations in
2027 and the bulk earthworks (for airstrip and other initial works) to
commence in early 2026 after the Government resettles relevant households.

·    Pending project finance drawdown, funding is from working capital and
as-yet unused facilities.

·    Equity-risk project capital US$100 million:

o  A significant portion has already been secured, with 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 in respect of certain closing
fees and costs.

o  KEFI has received conditional proposals that exceed the remaining amount
of $60 million, through a combination of:

§ non-convertible preference shares for Ethiopian investors ("KEFI Ethio
Prefs") issued by newly incorporated Ethiopian holding company KME Minerals
Ethiopia Holdings Limited ("KME Ethiopia"),

§ a subordinated equity risk note structured as a "Gold Prepayment" or
"Stream" from a mining specialist fund, and

§ the issue of ordinary shares in either of the Ethiopian subsidiaries,
priced on the basis of a TKGM valuation reflecting its advanced status as a
funded project in construction.

o  The breakdown and details of the finalised equity-risk capital instruments
will be published by KEFI upon commitment and the signing of definitive
documentation in November 2025.

·    The Company will convene general meetings of KEFI, KME and TKGM in
November 2025 to approve elements of the Tulu Kapi project finance package
requiring shareholder approval, such as the debt package requiring approval
under the various Articles of Association.

·    The detailed documentation for equity, debt and insurance facilities
can now be finalised with the syndicate of investors, banks, security agents
and insurers in various countries. Standard "conditions precedent" apply to
drawdown, including that equity be drawn first. Thereafter standard covenants
and "conditions subsequent" apply, including change of control provisions to
protect providers of both debt and equity project finance.

·    The economic metrics of Tulu Kapi have benefited from the recent
increase in the gold price. These are summarised at the foot of this
announcement. Key metrics indicate the following, at gold prices ranging from
US$3,000 (compared with the current Standard&Poors' average consensus
price long-term forecast of US$3,000/oz, published 14 October 2025) to
US$5,000/oz (equal to the current Bank of America forecast for 2026 (published
14 October 2025). These estimates are derived from this gold price range of
$3,000/oz to $5,000/oz over the first seven to eight years from the existing
open pit reserves and the initial contribution from the underground resource
and are tabulated with more detailed explanation at the foot of this
announcement:

o  All-In-Sustaining Costs (after deducting royalties, taxes and sustaining
capital) at c. US$1,000-1,200/oz (the royalty component rises as the gold
price rises).

o  Net Cash Flow available for servicing debt and equity capital at c.
US$1.9-3.5 billion over 7 years of initial production from within today's open
pit Ore Reserves and Underground Minerals Resources.

o  Industry-standard valuation indicators for 100% of Tulu Kapi building up
to US$1.1-2.7 billion on successful start-up. This implies a KEFI beneficial
interest of US$740-2,292 million if we retain a beneficial interest for KEFI
within the range of 70-85%, which will be determined by negotiations currently
underway to optimize the structuring of the equity risk capital.

o  IRR 95-161%

o  These metrics:

§ will be updated once the equity-capital financings are finalised.

§ indicate more than enough scope to implement the Board's objectives for
this large potential cash flow, which are:

·    quickly repaying debt,

·    distributing dividends, and

·    supporting organic growth by taking advantage of our early mover
position in the Arabian Nubian Shield.

§ do not include any contribution from:

·    increasing Mineral Resource/Ore Reserve at the Tulu Kapi mining
licence area, especially at depth, where the last drill-intercept was 90
metres at 2.8 g/t

·    KEFI's 15%-owned and separately managed Saudi Arabian associate Gold
and Minerals Company ("GMCO"), which has already reported an aggregate JORC
Resource-base approximately double that of Tulu Kapi (in gold-equivalent
terms) and has secured licences to more than double the strike length of the
mineralised structures which host the current Resources.

·    A separate update will be provided to shareholders as regards KEFI's
pipeline of other projects and opportunities, including the following:

o  In Saudi Arabia, where GMCO is now expected to:

§ Complete its DFS on Jibal Qutman Gold around the end of this year,
targeting development of an open-pit and CIL-base gold production.

§ Establish an oxide gold Mineral Resource at the large Hawiah Copper-Gold
VMS Project next year.

§ Advance both projects through a staged growth strategy, optimising
development finance among the partners. KEFI and its partner each has the
rights to participate in each project or allow the partner to either sole-risk
or to dilute their GMCO shareholding.

§ Expand the Saudi exploration pipeline through the recent GMCO-Hancock Joint
Venture with Australia's Hancock Prospecting.

o  In Ethiopia, where KEFI's new holding company KME is expected to:

§ Enhance its portfolio of gold and critical material licences and
applications, which will be assessed during construction at Tulu Kapi.

§ We will also pursue legal action for certain exploration licences
originally held by the Company which we believe were improperly interfered
with by third parties. This action will take some years. The outcome is
unreliable but, either way, is not considered material to the Company's
progress in the next ten years.

 

KEFI Executive Chairman, Harry Anagnostaras-Adams, commented: "We are
delighted that the Tulu Kapi debt offering has now been signed by all the
relevant parties.

"This has triggered further activity at site as part of the launch of full
Project development this month and is allowing the remaining equity proposals
to be finalised amongst the assembled local and specialist investors.

"I extend my sincere thanks to everyone involved in this international
syndicate, spanning hundreds of people across public and private organisations
at Tulu Kapi, in nearby regional centres, in Addis Ababa, and across multiple
locations worldwide.

"With the gold price at a record high, this is the perfect time to be
launching Tulu Kapi."

 

Enquiries

 

 KEFI Gold and Copper plc
 Harry Anagnostaras-Adams (Executive Chairman)       +357 2225 6161
 John Leach (Finance Director)
 SP Angel Corporate Finance LLP (Nominated Adviser)  +44 (0) 20 3470 0470
 Jeff Keating, Adam Cowl
 Tavira Financial Limited (Lead Broker)              +44 (0) 20 7100 5100
 Oliver Stansfield, Jonathan Evans
 IFC Advisory Ltd (Financial PR and IR)              +44 (0) 20 3934 6630
 Tim Metcalfe, Florence Staton
 3PPB LLC (North American Institutional IR)
 Patrick Chidley                                     +1 (917) 991 7701
 Paul Durham                                         +1-203-940-2538

 

Further information can be viewed at https://www.kefi-goldandcopper.com
(https://www.kefi-goldandcopper.com/)

 

 

Updated Economic Metrics for Tulu Kapi Gold Project- 100% Basis

The updated metrics on a 100%-of-project basis indicate immaterial change
since last modelled in January 2025 and uploaded into the KEFI website

(see https://www.kefi-goldandcopper.com/projects/ethiopia/tulu-kapi).

The equity-capital arrangements about to be implemented are expected to reduce
KEFI shareholders' beneficial interest in the Project to the range of 70-85%

 

 

Board and Management Team

The organisation structure has been prepared for development, with KEFI
Leadership providing oversight of project management and corporate
development, and TKGM providing project management.

KEFI Leadership

·      Board of Directors: KEFI's board is led by Executive Chairman
Harry Anagnostaras-Adams and Finance Director John Leach, both of whom have
extensive experience in launching, restructuring and operating natural
resource-based companies. The board also includes three independent
non-executive directors with deep industry and Ethiopian knowledge: Richard
Robinson (mining operations), Alastair Clark (environmental and
sustainability), and Addis Alemayehou (Ethiopian business and investment).

·      Executive Committee: This committee, which includes Mr
Anagnostaras-Adams and Mr Leach, is responsible for operational policy,
organisational development and oversight of day-to-day operations and features
specialists in key areas: Chief Operating Officer Eddy Solbrandt (systems and
organisational optimisation), Rob Williams and Simon Cleghorn (technical due
diligence), Norman Green (construction), and Geoff Davidson (mining
engineering).

Tulu Kapi project-level governance

The governance and leadership structure for Tulu Kapi is composed of a diverse
team drawn from KEFI and its project-level subsidiaries, with significant
participation from Ethiopian stakeholders.

·      KME Ethiopia Holdings: This entity, which has recently been
incorporated to own the Group's shareholding in TKGM, will in due course seek
listing on the Ethiopian Stock Exchange (ESX), will have a board where KEFI
holds the majority, but which also includes non-executive directors nominated
by local investors.

·      TKGM: The board of this main operating company is also
majority-appointed by KEFI, including its Executive Chair, COO, and an
operations-focused non-executive director. Crucially, the Ethiopian government
appoints non-executive directors representing its Federal Sovereign Fund,
Ministry of Finance, and the Oromia Sovereign Fund, ensuring direct government
oversight.

Tulu Kapi operational team and specialist advisory support

The on-the-ground TKGM operational team is led by Managing Director Simon
Cleghorn and features a mix of international and local expertise, with key
roles including Head of Finance Theron Brand and Head of Government Relations
Abera Mamo. The project also relies on a wide array of specialist advisers for
various technical, financial, and social aspects, including Snowdens (mineral
resources), Lycopodium (processing), and Constellis (security).

GMCO

KEFI and its majority partner ARTAR (Al Rashid & Sons LLC) have, over the
past 17 years, developed a stand-alone management structure for GMCO in which
both shareholders are represented at the Board level (via the Executive
Chairmen of each).

Both shareholders also provide additional support in respective areas of
expertise.

 

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