Tulu Kapi DFS

The Tulu Kapi 2015 Definitive Feasibility Study (“2015 DFS”) evaluated a conventional open-pit mining operation with a 1.2Mtpa carbon-in-leach (“CIL”) processing plant. The full 2015 DFS is available for download as a 20.7MB PDF.

As summarised in the 2015 DFS, KEFI’s approach to the project completely overhauled the previous owner’s development plan for Tulu Kapi.

The 2015 DFS was also the starting point for value-engineering studies to further improve KEFI’s development plan, such as blasting studies to minimise and control ore dilution. Many project enhancements were made during the competitive tendering process with mining contractors and process-plant contractors, including:

  • refinement of the mining method and mining equipment specifications; and
  • optimisation of the process plant flow sheet and design.

The optimised plans were agreed with the selected contractors and then verified to the standard required for banking purposes.

In summary, since the 2015 DFS was completed in June 2015, KEFI has:

  • completed a number of follow-on technical studies along with preliminary procurement of key components and consumables; and
  • continued to improve project economics and undertake financial stress testing under a range of scenarios.

Based on the above work, KEFI announced in January 2016 an increase in planned production at Tulu Kapi to circa 115,000 ounces per annum at an average AISC of US$742/ounce over nine years. This increase is primarily due to expanding the process plant capacity to 1.5-1.7Mtpa.

Gold recoveries are forecast to average 91.5%. Utilising semi-selective mining techniques, it is planned to process ore mined above 0.5g/t gold. Based on this mining approach, the following key mining and financial parameters for Tulu Kapi have been estimated:


2016 Contractors’ and Bankers’ Preferred Plan
9-year open pit mine plan

2015 DFS
13-year open pit mine plan

Waste:ore ratio



Total ore processed



Average head grade

2.1g/t gold

2.1g/t gold

Total gold production

980,000 ounces

961,000 ounces


Cash Operating Costs

US$634/oz US$661/oz

All-in Sustaining Costs

US$742/oz US$780/oz
All-in Costs
(including initial capex)
US$872/oz US$906/oz

Based on utilising contract mining and building an all-new processing plant, the table below provides the key components of the estimated peak funding requirement:


2016 Contractors’ and Bankers’ Preferred Plan
9-year open pit mine plan

2015 DFS
13-year open pit mine plan


67.0 65.6

Roads & Power Connection

15.0 19.7

Tailings (TSF)




15.9 14.3

Owners Cost

8.2 8.9


116.1 113.0

Pre-Production Funding

6.7 8.6

Total Capital

122.9 121.6

Financing Costs

3.4 N.A.

Cost Overrun

12.3 N.A.


139.6 130-150

The base‐case financial metrics tabulated below are stated on an after-tax basis:


2016 Contractors’ and Bankers’ Preferred Plan
9-year open pit mine plan

2015 DFS
13-year open pit mine plan

IRR Leveraged



NPV Leveraged (0%)

US$253M US$187M

NPV at start of construction end-2015
(8% real discount rate)

US$136M US$106M

NPV at start of production end-2017
(8% real discount rate)

US$197M US$156M


4 years 4.5 years

Average Operating cash flow before depreciation, financing charges and tax

US$66M p.a. US$47M p.a.
Average Net cash flow after depreciation, financing charges and tax US$32M p.a. US$24M p.a.


The above metrics are based on a US$1,250/ounce gold price and the targeted US$100 million of secured debt-based finance. KEFI has continued to refine the above estimates since January 2016.
KEFI Minerals is targeting commencement of construction of Tulu Kapi in H2 2017.