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Here’s Why KEFI Shares Barely Moved on the Q3 Progress Update

Simon Mugo trader
Updated 25 Oct 2022

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Key points:

  • KEFI shares edged higher on releasing its Q3 operations update.
  • The company expects to commission its two lead projects in 2024.
  • However, investors muted reaction was due to the project timelines.

The KEFI Gold and Copper Plc (LON: KEFI) share price edged higher after releasing its Q3 operations update, showing that it has made significant progress at its Tulu Kapi project in Ethiopia and its Jibal Qutman project in Saudi Arabia.

The company’s CEO noted that at the current pace, both projects would be ready for commissioning in 2024, with steady-state production expected in 2025. In addition, the mining and exploration company noted that it had secured up to 95% of the financing required for the two projects via its operating subsidiaries.

Also read: The Five Best Gold And Gold Mining Stocks To Buy Now.

KEFI Minerals has been advancing its Tulu Kapi project in Ethiopia during Q3 and expects the project to be ready for launch in Q4. However, the firm noted that the latest project costs estimates from suppliers indicate that it needs $320 million to complete the project’s construction.

The company also issued an updated project finance plan to relevant stakeholders within the syndicate and expects the same to be approved by mid-November 2022. The plan is subject to approval by the project’s leading lender after the start of open-pit mining, which is less costly than underground mining.

KEFI Minerals noted that a critical obstacle to the financing had been lifted after the company made decent progress during negotiations with the government. Therefore, the project should now progress towards financing much faster.

The mining company has also been progressing with its Jibal Qutman project in Saudi Arabia as it was waiting for the Ethiopian government to approve the continued exploration of its Tulu Kapi project. The firm noted that it had updated its initial resource estimate for the mine from 200,000 ounces of gold to over 500,000 ounces.

KEFI plans to mine the gold over the next ten years and was recently granted exploration rights to an area covering over 270Km2, which includes Jibal Qutman’s 733,045 oz gold resource and a massive land package along a highly prospective strike length.

Investors muted reaction to the announcement was primarily due to the timelines involved since the project is expected to be commissioned in 2024, over a year from today.

*This is not investment advice.

KEFI share price.

KEFI Gold share price 25-10-2022
Source: IG

The KEFI share price rose 3.44% to trade at 0.60p, rising from Monday’s closing price of 0.58p.

Simon has over six years of professional trading experience across FX, commodities and equities. He has a strong passion for financial markets and is particularly focused on price action trading