KEFI Gold and Copper Plc (KEFI) Earnings Call Transcript & Summary

Good morning, and welcome to the KEFI Gold and Copper plc investor update following the general meeting. [Operator Instructions] The company may not be in a position to answer every question it received in the meeting itself. However, the company can review your questions submitted today and publish responses where it's appropriate to do so. Before we begin, I would like to make the following poll. I'd now like to hand you over to Aristidis Anagnostaras-Adams, Founder and Executive Chair. Good morning to you, sir.

Good morning. Thank you for making the time to participate today. For those of you who are not familiar, we have just conducted and completed a general meeting. The resolutions were passed with approximately 91% vote by proxy and there were some other people present here in Cyprus who are supporting it. This is a webinar taking questions after giving a short presentation. It's not a regulatory requirement. It's just something the company does in the interest of information and transparency. If you could flip the slide and the next one, again, please. There's only going to be a handful of these and then we'll get started into the questions and we'll stop at 1 hour and my colleague, Eddy Solbrandt, sitting to my right, the COO, who will also answer some of the questions. And I have a commitment to go to at 1:00, our time here in Cyprus. So this will be one hour webinar. Thank you. Now this slide [indiscernible] convey a very simple message, and that is that we went into what we call frontier markets for mining in 2008, but today, the industry is arriving by the plane load to join in, including some of the highest profile explorers, developers and operators in the world. So the old adage, it's not hard to be right, but it's hard to get the timing right. Well, most of the industry is now coming in. We've been there since 2008. Next slide, please. The priorities of the company right now are squarely focused on Ethiopia. The project finance for Tulu Kapi is -- has passed its first approval. So the lead -- equity lead debt and lead equity risk notes and other form of equity have all approved. And in fact, our government partners are already spending a lot of money, more than approved. And it's now moved on to the approval process for the second bank, the second equity risk note and the second government agency. So we're in full swing, you might say in terms of the approval process. These are all -- I can't think of any organization that I just referred to that would be less than less than $5 billion. They range between $5 billion and $40 billion organizations. So their approval processes are those reflecting very large organizations, multinationals with their own very strict governance procedures and they're being very collegiate. But again, they all have their own restrict governance procedures in such large organizations. And KEFI's advantage as a small company is to be fleet of foot, but we're using the capital in support of huge corporations and government agencies who have, let's say, a slower process to go through. But you have to respect that. It's their money, it's their name, it's their commitment, and that's what we do. That's the name of the game today in Ethiopia. It's all focused on closing and launching, and I'll go in a bit more detail shortly. In Saudi, the projects that we've discovered there are not as advanced as Tulu Kapi obviously. They're still growing a lot. The rate of expansion of the resources there is significant and influencing our decision making in terms of optimizing the development cases to choose from. So that has to be let run a little bit longer than we originally thought because they're growing so much. They have to be let run a little bit further. The other thing that's happening in Saudi is the regional exploration. We're being encouraged through our own ambition but also through, I suppose, competitive pressure with all these people arriving now in Saudi, and it's also happening now. To a lesser extent, but started happening in Ethiopia as well, people arriving to get on the ground. It's motivating us to spread wider and harder and deeper. So building up the teams further and that sort of thing. This is the moment to go, so to speak. Go with Tulu Kapi, then follow through with the other 2 in Saudi Arabia, and it's the moment to spread our wings on the ground exploration-wise with a pipeline of projects coming through behind those 3 advanced projects. Hard to convey really to people who suffered so much frustration and have to be so patient starting a small company like KEFI, a GBP 2 million IPO in 2006. And now the company, in effect, having pulled together Syndicates that are between these 3 projects lining up for over $1 billion of expenditure. Would be impossible, obviously, if we didn't pull together partnerships and project finance and contractors and equity investors in the region, but we have it. And I well understand -- I well understand that many shareholders perhaps have never seen that sort of process before, let alone one in a frontier market, which has never done it before. So I must be perplexing at times, confusing and frustrating. And of course, the countries changed around us. In Ethiopia, we arrived to a quiet country and all of a sudden, there was a civil war in the middle of our 10-year journey there so far. So we've been surprised. We've been held up by surprises, but we're still there, and we've kept together our syndicates. So for those of you who are terribly frustrated and disappointed, we apologize. For those of you who are frustrated and looking forward to the excitement of what we believe is coming, welcome to the journey. It comes with incredible determination. We're very hard-working people. You can't do it any other way. Those of you who think that I'm in Cyprus to lie about the beach or by the swimming pool, you've got no idea. And it's important to note and to recognize that the tenacity and commitment of the team is what will build this company and I truly thank those people, those colleagues for that. A little measure of upside potential is the NPV and other measures of metric values and so on. They're just measures. They're no more important than measuring sticks. But they give you a guide and how we stand today at today's gold price, which obviously is incredibly encouraging, so high and looking strong. Just on an NPV basis using the same approach that the industry does for all its comparative statistics, our share price is about 1/10 what would be if it reflected the NPV of the Tulu Kapi asset. The value, if you like, of the Saudi assets is a lot smaller today, partly because Tulu Kapi is charging ahead whilst that's not yet charging ahead at the same stage, but also because we don't think right now, we can apply NPVs to it. It's not quite right to apply NPVs to pre-DFS projects. And when they have passed through final feasibility study and final financing assessments, we'll apply DFS NPV style numbers to them. But right here and now, if you put those the NPV apple together with the other measure that the industry uses on Saudi, let's call it an apple plus an orange for the moment, you're talking of about 12x today's share price. That's a very simplistic, but nevertheless pertinent measure of the upside here as we derisk and proceed. Next slide, please. These graphs done by Orior Capital, the guy who runs Orior Capital used to be the Head of Mines and Metals at Macquarie Bank, perhaps one of the larger commercial banking, broking, institutional investment platforms for the mining space globally. And you can see where -- the bottom right-hand slide is really just a grade comparison showing that we're pretty good grade at Tulu Kapi, but the other 3 slides are just measurements against industry standard value benchmark. And you can see we rate very lowly. The stock market today puts a fraction on the company of what it will put on the company in our view in due course just by following the industry pattern. Next slide, please. Very busy slide here, but I do ask you to -- for those of you who are into really measuring and understanding and not just sort of focusing on next week's events or whatever, but really trying to understand underneath it. The right-hand side columns are what we call bankers views, the 2 columns to the left are owners' views, and we've compared the metrics using those different sets of assumptions, which are all explained there. The bottom line is to show you in some detail how we've set up the structure. Essentially, we've set up the structure so that even if gold traded as low as $1,200 every day throughout the life of the project, the banks would get out, and we would honor our obligations to the lenders. And then -- and $1,200 is considered a reasonable benchmark to do that because it's the gold price that has only been down that low for, forgotten, but something like 10% or less over the last decade. And if you look forward, the average cost in the industry about $1200, so I think if you design the debt structure to be serviced and worked out whole at $1,200, you're on safe ground. So that's our feet on the ground approach, if you like, but our head in the clouds is to actually reflect what our business plan is, not what our bankers assume, but the plan actually is and to run the numbers up with more realistic long-term gold price forecast. And you can see there some fairly large numbers washing their way through to the bottom line in various measures there. But I'll leave that to you to look at more carefully after the webinar. Next slide, please. Expected milestones ahead. We're in the middle of the first half of '24. We've got a cascading series of approvals, which is halfway through. We've got a cascading series of detailed legal drafting between the dozen parties or so. I'd say we're about 90% of the way through taken as a complete package. Preparation of community for resettlement, well they completely surveyed in past times. They know exactly what's coming. So there's no surprises there, but we need now to refresh the survey and that's a 2-month job realistically, and that has to start and hasn't started yet. But we didn't want to start it. It's important morally for preservation of social license, respect -- meet your respect with your community. You can't start that until you know that all the approvals are in the bag. Otherwise, you're lifting expectations and anxieties to the community to be removed from property and homes that their families have lived in for generations. So one can't do that ahead. And those of you wondering perhaps why it wasn't done already, you can't morally. Only when you actually know that the bank approvals, both of them are in your back pocket, should you start there? Yes, the cascading series of things is the details of conditions precedent. The big ticket items are done other than demonstrating that we can work in this community and get everything ready without being interfered with from a security viewpoint. And the government certainly undertaking to do everything that's required on that front, but everyone wants to see it to believe it. In closing and then, of course, upon closing the funds start to get drawn down in the correct sequence and we start procuring in resettling and constructing. Plus -- we are in the business now of closing and optimizing where we're heading because we're getting into a different platform now. And so there's any number of IPAs that are floating around to go for it, and we've got a number of parties approaching us -- have approached us to somehow participate as a typical thing that happens. When someone sees a project or a country about to take off, there's no shortage of [indiscernible] and interested parties. Overnight success after 15 years, so to speak. Next slide, please. Saudi, just not ready for triggering -- for finishing feasibility studies and triggering development in 2 projects that aren't sitting still. They keep growing. And that process has to run a bit longer. And the metallurgical side of the optimization is a bit elusive still. That needs to be settled down a bit further before we rule off feasibility studies. But it will be -- between those 2 projects -- between the 2 of them, they will do off to Tulu Kapi and between the 2 of them, they will measure up in value much higher relative to Tulu Kapi when we've signed of feasibility studies. And the financing is a similar style, almost exclusively done at the subsidiary level. The regional exploration in Saudi is we've received 14 licenses in the last 18 months, and I think we've received 3 or 4 in the previous 13 years. That's telling you how things are moving differently nowadays. And again, strategic choices, as I said. It's no shortage of third parties wanting to somehow engage, invest whatever in our business there. Next slide, please. So we are in the Arabian-Nubian Shield. We've highlighted 2 countries there. If you put the color coding on to the other countries in the same geology, you pick up the neighbors, Yemen, Oman on the western side or the eastern side rather, and on the western side of the Red Sea, North Sudan, Eritrea, parts of Egypt and even up into the Mediterranean into Cyprus where I'm sitting, parts of this geology. Oman is called Cyprus style geology. And so it's the blanket of this geology covers a fair bit of ground in that part of the world, but we've only focused so far Saudi and Ethiopia. I'll pull up there. I've taken 20 minutes. We now have 40 minutes for -- to go to the questions. I'll hand it over to start working through them, please?

Yes, of course Harry. Thank you very much for the presentation. As you know, we have received a number of questions presubmitted and we've got a number of questions that have come in live. So we'll do our best to get through as many of those as possible. And perhaps I'll start with the first one here, which reads as follows. You announced in February last year that you intend to be listing on the Saudi market. How is this progressing?

Well, we announced last year that we appointed advisers to consider a listing in the Saudi market. Having had taken detailed advice, met the Saudi Stock Exchange, we've come to the view that they're just simply not ready for a preproduction company. And we'll be blowing way too much time to break new ground on that particular front at this point. That's the bottom line. Ironically, Ethiopia appears to be much more ready, as strange as it may seem. They haven't even launched the exchange, but they're deliberately asking us to launch dual list or launch listings in the Ethiopian exchange when it opens later in the year. So the Saudi exchange isn't ready for a preproduction company. That's the short of it. So it can be addressed when there is production. And in Ethiopia, we can address it earlier. The reason we look at these things, frankly, is because I suppose it's stating the obvious that we're raising capital as to hundreds of millions of dollars in these countries, which means there's much more capital chasing our industry and our company in these countries, and there are where we've got our primary listing. It sounds strange, but it's the truth. And so that's why we're looking at these things. Next question, please.

Would you consider selling the Tulu Kapi project after funding is signed off to focus on Saudi with the resulting abundant funds of exploration costs?

We're an explorer-developer-operator. That's our philosophy, that's what we'll do. Having said that, we're a public company, and we've always have a duty to optimize returns to shareholders. But I don't think it would be realistic to assume we would simply sell out after developing the project. It wouldn't be compliant with social license and government expectations. But certainly, you could sell down, but that's not the priority today. The priority today is to get this show on the road. And when it's well and truly on the way, its value will climb significantly, as I was presenting earlier and it will be a great problem of success to be given choices for cashing in some of that value for shareholders. Thank you.

Perfect. Can you give investors some idea of the value of both the Tulu Kapi and Saudi assets taking into account the healthy gold price?

Yes. I mean I've already answered that actually. It was in the announcements in the presentation. But I mean, to, maybe just add 1 or 2 points for the person who's not used to studying these sorts of numbers all the time. When a junior company migrates to the status of a producer, the market cap is typically something over NPV. Time doesn't permit to explain why, but it just is, it's empirical. I'm not being a theorist. I'm telling you it's empirically the fact. As a company migrates to a multi-mine entity with a number of mines running preferably in multiple jurisdictions, so you can diversify some of the sovereign risks involved, it's much higher again. And that's empirical fact also. So today, we're capped at a fraction of the NPV of Tulu Kapi. And when we bring on the Saudi projects, we -- that will feed, if you like, that gap of value growth. So there's plenty of upside here, whichever way you cut it, and it's growing as the assets work their way up their development pathway, but what we have to do is deliver. And these countries stand still long enough to let us deliver, it will deliver. And that's what's happening now. They're very driven, committed to getting these industries going in both countries and we happen to be at the front of the queue or around the front of the queue in both countries. So that is have to stand still long enough and keep supporting us and protecting and so on and we'll deliver.

Perfect. Turning to the next question. We understand the consortium of investors went to their respective boards at the end of February. When we -- you've got the binding contracts in place?

The binding contracts are drafted nearly completely, all of them. And the sequence is: complete those approvals; complete the drafting; all gather around and have a big meeting; confirm that everyone is ready; then refresh the lump sum pricing, which might go down or might go up given what's happening in the market on the plant; refresh it to show that the contractor can sign a contract with live prices in it and you can't do that until we're all ready to go; and be refresh the property survey of the community, you can't do that until everyone's ready to go. With the plant person, the plant procurement, you have to order within 60 or so days. With the property resettling people, you have to compensate them within 6 months. So all the approvals, all the contracts drafted, refresh numbers, then sign, is the sequence to this. KEFI could have ignored all this sequencing and done it on its own Jolly Merry way if we were using our money, but we're using the money of banks, contractors, investors, and we have to do in the right sequence. Next one, please?

Perfect. We're waiting on the second bank to confirm the debt financing. When are we expecting this to happen?

Well, the first bank when they triggered just to give you an example and then I'll move to your question properly. We waited -- we have to wait until October to finally get the full approval of all our foreign exchange exemptions. We thought we had them in the first half of the year, but the fine print didn't match, and it took us till October to get it formalized with all the correct fine print. We then immediately called a syndicate meeting in November, and the bank -- the first bank gave its final approval -- credit committee approval in December. So rapid fire for giant banks, but that took 2 months. And then we announced that in January when we were allowed to do so and they gave the member country ratifications. Their Board represents the member country shareholders. They're ratified in February, no changes, just ratification and that triggered bank #2. Bank #2 is in the committee, and they've been working hard to now trigger their thing. It could be -- the initial one could be now, like I mean this month, that's what they're working towards and the final one next month. But run the bank and they'll have to do what they do in their own process. But it's on. It's imminent, if I can put it that way, according to a bank's time table, not according to what I would wish for tomorrow, so to speak. Hopefully, that's a fulsome answer. Thank you.

Perfect. The recent placing was a shock as we were told repeatedly that the placing was not expected before financial closure. I understand there must have been delays, but we're surprised the company sought GBP 4.5 million. Why did the company not just raise GBP 1 million and then raise later a considerably higher share price post the financial closure?

Yes. Well, very frustrating to me and us, I can assure you, but if there was no mismatch between the fine print of the foreign exchange exemption and what had been expected and agreed last May, this stage would have occurred last year, and we'd be up and away and what we intended to do with the capital side was not to raise any capital until we had closed the whole thing. The reality is that the fine print didn't match. We had to stand our ground and make sure it matched. I can assure you it would not be in shareholders' interest to invest hundreds of millions of dollars and not be able to get your capital out of the country or your dividends out of the country or your debt repayments out of the country. So we are just bite our tongue and stand our ground or what have you [Technical Difficulty]. That's the disappointment. It's not because management preferred to wait because we had to make sure that we're protecting the company and the syndicate properly. And if GBP 1 million was enough, we would have raised GBP 1 million, but GBP 1 million wasn't enough. We had to clean up the balance sheet for closing, and that's, I'm sorry, what we had to do. #1 duty is solvency protection. #2 is we make sure this thing closes and we get on with it. And that's a simple truth. Next question, please.

In the 13th of March RNS, you said the priority is to implement the remaining, mainly administrative tasks, which are expected to be successfully and swiftly completed and then you would provide regular updates. Can you explain why we are now over a month since this RNS and have no update. All binding agreements from the second bank having confirmed the debt or any other administrative matter being completed?

I was a bit perplexed receiving because you sent me this question and it has been received ahead of this webinar, and I was just a bit perplexed. And I looked at how many announcements we've made over the last few years, and we make an average of 3 or 4 a month and we have 4 webinars a year. We've made 13 announcements, I think, since October. So I'm just a bit perplexed how many RNSs would be too many. But certainly, anything material that is announceable, we have to announce and I don't think we hold back news or I don't think there's any evidence that the company doesn't make many announcements.

Perfect. Next question here, maybe one for Eddy. Eddy stated in the presentation mid-November that the banks had asked for another couple of weeks. Why are we still waiting at the end of March for the second bank to give the green light to the TKGM financing?

I think Harry has answered that a little bit earlier. But just to repeat, we -- the first bank went to a final credit mid-December. The second bank, we would like to believe, would be close behind. But as Harry explained, these banks have their own committees, internal processes, and they've taken longer, they've had more questions. Ultimately, it's a good sign. They've been very diligent, and we're expecting positive results from them soon. But why particularly, I can't answer. Next question.

Does the Ethiopian national and local governments deserve the building and benefits of the Tulu Kapi mine if they're currently running at full speed ahead. I wouldn't see them moving at a slow pace?

That's for us to decide who deserves what. What I can say, though, is this project will benefit the local community in honestly. We're creating thousands of jobs, direct and then indirectly in the community. And not only for this generation of people, but as we dig deeper and expand the mine, it's a generational change of lifestyle and prosperity that we're bringing to the community. And I think that's really the important thing here. Next question.

What hope can you give long-term shareholders whose original purchases are not significantly down. Every time the share price seems to start recovering and climbing, they're hit with a discounted placing. It then takes 6 months or so to clear the results overhang?

Well, I mean, the truism is that it's very difficult to swim against the tide and I think we put in our last annual report, some statistics, if I remember, were that the KEFI was listed in 2006. Its share price peaked in 2011 as did that of the sector. And when we look at the index with junior gold miners, which is defined as companies over $100 million to be classified in that index. So companies like KEFI, which are micro companies would be below that index or in a different index, but that's the only index we have to look at. From its peak in 2011, it was into a negative number now last time we looked at it. Now maybe it's not so bad today because the gold price is running, but it's not a good number. And so we've been in the tide of a very underperforming investment sector. Why does one invest in a micro cap in a sector that's underperforming? A question for you. Presumably, it's because the leverage on the upside is judged to offset the risk of the investment. And we sincerely, that is the -- believe that is the case. We have gone down with the sector, but we've created a hell of a lot of intrinsic value. And if we hadn't lost probably 5 years with these wobbles in these countries to put it mildly, perhaps should be on the way by now. I would have thought we'd be in production in Tulu Kapi long ago if the country hasn't had a civil war in 2022. So '21, '22, I've got lost track now. But anyhow, the fact of the matter is the leverage on the upside is huge. We talked about it earlier, and that's the only reason that one gets involved in early-stage businesses in a preproduction company and from key markets. It doesn't get much more challenging than that, exploring frontier markets, civil war, you name it, it's been thrown at us. And here we are with 12x upside. That's the only reason we're doing this work because of the upside for all of us and most of the senior people have taken a large proportion, if not most of their remuneration in shares. So we couldn't get any better aligned than that. So time will tell whether we're all sensible and if we made the money that warrants the effort, the patience and the hard work that we think it will, but it's certainly been the losing so far. We agree with you. Next question, please?

Next question here. The many recent presentations that KEFI has beneficial interest of 2 million ounces of gold equivalent in its 3 project and at current prices, that is $4.3 billion worth of gold. Why can you not persuade larger investment institutions with the crazy opportunity of investing in KEFI at the current market cap of $30 million? And why do not invest? Are we private investors being naive in backing the company and management when more experienced investors stay clear?

I wouldn't self-flagellate over that one because big institutions are not allowed to invest until a company has a certain scale and they have different rules amongst them, but [indiscernible] and the scale for a very large institution to invest is measured in market cap and in liquidity. And it'd be extremely unusual and actually contradictory to most governance policies of large institutions for a company of under $100 million market cap to even be considered. It's simply not allowed to consider deploying capital into such small companies. So the natural thing here is that a savvy private investor who puts in the time and effort to try to pick the winners when the ratings move up with success and as you go through closing and construction and so on, the big institutions will jump on board. And those who prefer the higher risk, high return territory, will go back to spotting the next one. But the answer is simply that it can't. Thanks.

Next question here, what are the next steps in returning the exploration licenses for the areas around Tulu Kapi?

I'll just answer that. Look, that matter is currently with the Ministry for Mines and we really can't comment on that just now. Next question, please.

In Saudi, where will the 25% funding [indiscernible] part of the JV come from? Does this mean more dilution? And when is this due by?

I mean just -- I'm not quite sure I followed that, but the overall picture is that we -- 100% of the capital for these projects will be broken down into project finance, say, 70%, 75%, and we will put up our share of the equity. So we'll put up 25% of the 25% equity, which is about 6%. That's the gist of it. Now, there are other opportunities to take it down further, but that is a remarkably small percentage, considering what we're achieving. And in the meantime, our partner is carrying us. And that's a remarkable achievement considering what we're doing. So we can bring in more financiers, we can increase the debt gearing, we can do any number of different things. We can bring in someone who wants to buy in a bigger percentage of a particular project. There's any number of things. I think we've demonstrated where we're really using every tool in the toolkit to minimize dilution for shareholders. But the problem is we've got such a large job on our hands. The working capital to get the company to this point in time has been challenging for a little [indiscernible] stock. But it's a tiny drop in the bucket of the capital that's being deployed in all these things, but that's what we'll continue doing. We'll continue to use every tool in the kit really.

Perfect. Another question here. What is the lowest investment value? And how can I invest?

I really don't understand the question, but it depends what you mean by lowest invested value. If you look at stock prices, it depends on the horizon, you can look at a monthly/quarterly low, that would be the lowest value. And you could look at the monthly or quarterly or annual high, that would be the highest value. How do you invest, get a broker.

Perfect. The work in funding metals by KEFI exploration team is incredible and the future potential of the company is absolutely fantastic. Why can we not get this TKGM financing over the line and start realizing that value.

We can't answer that. I think...

Yes, I think we've done that one [indiscernible].

Perfect. How would you rate your stewardship of KEFI in regards to company value and also shareholder value?

Mining is a long game, as Harry said earlier and doing it for the long haul, the average time from exploration through the production is around about 15 years. Given that we've had historical events, we'll change events on pretty much both sides of the Red Sea in the last 15 years. I think our record is exceptionally good. You can't predict wars, you can't predict unrest, you can't predict changes in regime. You can speculate, but you can't predict. So as we're moving through with this -- or these assets that we have, we have to bend flex and change the circumstances as and when they arise. It's frustrating for a lot of us because we're also shareholders. And because of that, I think we've done a very, very good job in stewardship, and we'll continue to do so. Next question.

If the Saudis are looking to invest in mining abroad, would it not be possible for them to provide the funding for Tulu Kapi mine?

If the question is, is there enough money in Saudi to fund Ethiopia, yes. If the question is, do Saudis have a habit of investing in Ethiopian mining, no? Have some of them -- I've been in Saudi 2 weeks over the last 4 or 5 weeks. So we know our way around. I've been in game 15 years. If the question is, have they developed a culture and mechanisms for investing in Ethiopian mining, no. Have invested in Ethiopia? some extent. So we're breaking new ground. This is the first mine development in Ethiopia since the 1980s. And it takes time to mobilize conservative, high net worth offices and banks into new jurisdictions. But it's a hot topic but it just takes time. Now we've got ourselves covered, I believe, in Tulu Kapi, but it doesn't mean to say we're not creating more choices for the future for other ideas as well. So we're addressing it. But you can't expect rapid fire decisions around hundreds of millions of dollars as one might do for a trade on the stock market. It's a different sort of time scale.

Perfect. Can you give investors some clarity on the meaning of conditional approval? Does KEFI have to wait until the approval is unconditional for at least funds? Can mining construction commence with conditional approval?

Do you want to take that. Or should I?

Look, all lending is conditional, if you think about it. Whether you get a mortgage or a car loan, there are certain conditions that have to be fulfilled before you get a loan that you got to be able to pay. You've got a steady job, more assets, et cetera, et cetera, et cetera. And there are also conditions precedent -- antecedent I should say, afterwards. You have to keep on paying down your debt. It gets more and more complex as the projects grow. And certainly, mining, we've got a lot of conditions that need to be satisfied for the banks to be able to draw down, but also for shareholders. And these relate to corporate governance issues, environment, social issues, labor, anti-slavery policies, safety, security. There are a whole string of them, and they're not just imposed by individual banks. There are governing bodies around the world, UN and IFC and others that dictate what they are. Banks want to make sure they are lending to credible organizations that not only have the capacity to repay, but also work to the highest standards. And before they approve money to be released, they want to make sure that we are continuing to work to those standards. Next question?

Perfect. A recent interview states that KEFI intends to use the Saudi Industrial Development Fund to access low interest loans to fund KEFI's proportion of exploration costs in Saudi. Why hasn't the company utilized the source before and maintained a higher percentage stake in GMCO?

We wouldn't borrow money to fund exploration even if it was available, that's what you referred to, is not available for exploration. But even if it was, it would not be wise to borrow money for exploration. Exploration by definition is with the work you do and you don't know what you're going to find and borrowing money to fund that sort of work would not be a wise thing to do.

Maybe just following on from that, we have another question here. It's been announced Saudi Arabia that grants [indiscernible] companies exploration licenses of approximately GBP 1.5 million per license. KEFI has 14 licenses, I believe. So is it possible to tap into this grant funding of each of those 14 licenses?

Yes. The numbers you quoted weren't quite right if it was pound. It's been quoted in SAR, probably Saudi Arabian riyals. But yes, we're going through all the fine print on all that, and we'll avail ourselves an opportunity if we can. We're going through it all for sure. They're trying to incentivize exploration. One way they did that for us was to grant 14 licenses when in the previous 13 years, they've only granted 3 or 4. So that incentivized us and now offering money. We'll see. Policy statements by government is one thing, checking the fine print and getting the money is another thing.

When is the community resettlement scheduled to commence and when is this milestone at risk with funding delays?

Well, it's important to understand the process here. Firstly, resettlement is not our obligation or our responsibility. This is the responsibility of the government? The whole resettlement procedure is governed by proclamation that is by acts of parliament in Ethiopia and supported by regulations that give clarity as to how those proclamations are to be implemented to quite a degree of detail. It is a highly prescriptive process. And it's designed to ensure fairness. Before that process can begin, a number of things need to be in place. And the most critical of those is that new house lands have been identified, surveyed and the government knows that person A is going to land Block B in the future. So that's a complex process. And that's all of the government's work. Now once that work has been completed, then they go out and survey, resurvey and as Harry said earlier, the existing landholders' land has been surveyed in the past. It will have to be resurveyed. We are a part of the survey, but don't run the survey because we have a right to ensure that those surveys and the inventories of each property are correct and accurate. Now once that process has been in place, then we can start or the government can start the resettlement process. So the funding delays haven't really impacted that. It's squarely the [indiscernible].

Yes, I just add one. So, it's sort of when is the right moment. I was saying earlier, we do not want to make the mistake that our predecessors made on this project. When I turned up in the country, there were 400 employees out there. A school had been built and all sort of things have been done, and those people have to be retrenched and it created a hell of a storm because the project simply wasn't ready. And why they charged ahead and did all that stuff, I don't know. Anyhow, we gave our word. We wouldn't start that process formally. They all know it's coming, but we wouldn't start that process until at least both banks have signed off and the others were all lining up. And that's a moral conviction, which we will stand by, and it's all scheduled in this process. You don't have to complete all the deals with every individual. What do you call it, landholder? But you have to do enough to make sure you can get going and you have to have done the survey, so you now could close the whole thing up. So it's all scheduled in, and you don't start with settlement until you start the development. So you don't hand over money until after closing. So it's synchronized carefully, not too early, not too late, sort of idea. Hopefully, that makes sense.

I have 2 questions coming live on a similar theme. Perhaps I'll read out Rob's question. Once Tulu Kapi is up and running successfully, are there plans to start distributing a dividend?

My mistress would certainly love a dividend sooner rather than later. Yes, I think if you look at that table, we had in that slide show earlier, just look at it for 2 minutes and look on the bottom where it shows cash flows available to the debt, to the equity risk note and then to the shareholders. You see some pretty impressive numbers there. And I'm certainly of the view that one of the problems with this industry, the reason it behaves that poorly in the stock market is that too few people really treat shareholders well when they succeed. That's my sincere belief that too many entrepreneurs just reinvested, more exploration, more development and the shareholders never see a dividend. And we are determined to not make that mistake because I think that's why the sector behaves poorly in the stock market. There hasn't been enough good fiduciary conduct in my view. Now it's a high risk game to go and explore and certainly, frontier markets are even riskier. That's sort of risk squared almost. But when you make it, you've got to distribute dividends in our view. I mean, we're nowhere near it. Yes. So I'm not making guarantees for next year or anything. But philosophically, no question we will be making dividend distributions.

Perfect. The next question here. When do the milestones delivery in 2024 start to impacted by bank approvals and you got a follow on to that, which is, can you outline, say, 3 or 4 milestones with worst case dates in the next 3 to 6 months?

Well, the bank approvals, we've kind of gone over this bank approvals really haven't impacted delivery milestones. They're integral to our processes, but they are not necessarily drivers of our schedule. And if I had to look at 3 or 4 very high-level milestones and it's not easy because our project schedule at the moment runs about 800 lines of activity. But if you had to plug a few out of the air, I think the host land survey is completed would be a huge milestone. That paves a way for a lot of things, final binding documentation signed by all parties. That's a huge milestone. And I think for me, personally, early earthworks commenced. That would be another big master and that really shows we're on the road and we're moving ahead rapidly.

The only comment, perhaps it's self-evident, but when you're stuck defending a project, defending your personnel in the middle of the troubles that this country had in Ethiopia, it's intense work, extremely challenging work to defend and to stand still and to maintain bank and investor loyalty. That was really hard stuff. Motivationally, it's really difficult because there's no joy in it. It's just survival. And now that everyone is working to proceed, I mean, it's incredibly joyful. So I can put it that way, everyone can taste it. And so it's a different gig altogether. And whether it's an [indiscernible], now it's fun and everyone jumps out bet and gets on with it because we're actually doing it. So it's a completely different story. And the fact that all these companies are now picking all around us in the Saudi Arabia and coming to conferences and strutting around, offering us to deals and so on it, it's a wonderful relief compared to what it was 2 years ago, I got to tell you. And so it's just -- frankly, it's a lot of fun, a piece of cake compared to where we were. Now we have to pull it off. We have to do it all, many a slip between cup and lip and all that sort of stuff, but I can assure you that this is a piece of cake really compared to what it was like before these 2 countries turned the corner.

That's great. Harry, If I just turn you to the next question here. As the business develops, what knowledge transfer and management transfer is envisaged?

It's a very good question. Our view has always been that we will have locals running this business as soon as possible and that's on both sides. And to be very clear, right now, we have more locals in our businesses than we do expatriates. And one of the key things that we're integrating into all of our roll descriptions in Ethiopia is the accountability for managers to develop mentor and coach Ethiopian staff, local staff to be able to take their jobs. There's a [ guerilla ] view to that, is the government also needs to and playing a role in that as well to build institutions to be able to build capability for mining in that environment. So we've got all of that cemented and all of that will start to crystallize in a lot more detail than I've just said, when we commenced our operational readiness planning, which is around about 6 to 8 months or so after the construction begins. Next question.

Is the financing approvals for the lead bank conditional and conditions on the ground, i.e. ongoing security? If so, has this condition now being satisfied? Or is it still undergoing observation?

The test is not whether someone turns up and sees where everything is comfortable and quiet today. The test is observing our preparations for launch right up until the day of launch and having independent certification that we have prepared the community, we have prepared the sites for construction. The government agencies are equipped and delivering what they need to do. So the test is not one that can be satisfied until a week or 3 before signing to go. And that's because everyone wants to see everything done with no evidence that someone standing in our way or interfering in an unhealthy manner. So at the moment, we've demonstrated extremely comforting discipline. I can say that because these banks have been with us since before that war. These investors have been with us since before they that war, and they're with us today, which tells you that they've been through the worst a country can throw at a project, and they're still with us today. But they have to see that we prepared the whole site and the whole community without any mishaps and then they sign off on the security. It's not like going to an exam today or something like that.

It's a process, not an event.

It's a process, not an event, yes.

Perfect. Another question here. Do you see further delays due to the conflict in the Oromo region?

Well, let me -- I can't -- we can't tell you everything that we know. But what we can say to you is that there have been -- there has been a lot of pressure from us towards the government to install permanent protection. The problem has been, if I can pool that, that this area is not a problem area all the time. It flashes problematic once a month or something. And in the meantime, the security forces get deployed to where there is a problem somewhere else. So without talking out of school and what the government is doing, they are reinventing the structure of the security forces in order to facilitate that our permanent protection blanket is not redeployed anywhere else no matter what happens. And that's the word we gave to the syndicate. I'm giving you a very fulsome answers here, to be honest, sensitive. But the fact of the matter is that this is a green zone that flashes red occasionally. It's not a red zone like in Mali. There's areas always red [indiscernible], Burkina Faso, Nigeria. There's certain regions that are always read. This is a green that flashes red, and we're demanding permanent red zone security. And the government sort of reshaped its security forces to accommodate us. So it's doing everything it needs to do, and it will be fine. But the problem has been not that the area is a bad area, it's that the area is too good to leave very well-trained, high-performance military people standing and drilling their phones during the green patches, if I can put it that way. So we've had to invent another solution, which you'll see -- you'll see it shortly.

I think to add to that, we shouldn't discount the fact the government is committed to finding a political and peaceful solution. From what we understand, the Oromo area is also committed. It's case of waiting for those 2 bodies to go to the third round of peace talks. They've had 2 previously and to look for that. That's a longer-term strategy, but it's also a...

It's important. I know we've come up to the hour. But I'll just actually make a comment on that because it's so important. The country is not a country with endemic problems of a terrorism group or religious conflict. It just isn't. What we're seeing is the flow-on effects of the introduction of democracy to what was a centrally ruled with an iron fist country. And the conflicting parties are actually political opponents designing and negotiating federation. They're not trying to break away into another country. They're not trying to conquer some other ethnic group. They're not trying to conquer another religion. They're actually -- in the United States, we saw people dress as cowboys and Indians on the 6th of January last year, invade Capitol Hill. Roll that back. When democracy was first introduced over 2 centuries ago in the United States and imagine what you might have seen, and that's what you're seeing. It will go away. These people want to get on with life. But in the meantime, we have to have security, which we would have talked about earlier.

I think we're out of time?

Yes, I think we're out of time.

Yes, perfect. I think you've been very generous with your time. You've obviously gone over the hour, and you've answered many questions. But maybe just before redirecting investors for their feedback, Harry, if I could just ask you for a few closing comments, that would be great.

Well, it must be so frustrating to a person listing in the stock market, who's at a great distance, doesn't understand what's going on day to day. And I can only assure you that our attitude to transparency, which gets us into hot water all the time if we said nothing. We put out one announcement a month or once every 2 months instead of 3 or 4 months. We would probably get into less hot water. But what we're trying to do is to we're trying to communicate so that people understand the risks. And we are natural optimists. If we weren't natural optimists, why the hell would we do what we do. Now -- and a natural optimist by definition gets it wrong occasionally, openly admit it, hand on half. If I was a natural pessimist, why would I do what I do and the people around work so hard, breaking new ground, regulatory changes, all this stuff. So if you are a natural pessimist don't go into early-stage mining ventures. If you are a natural optimist, and you've got the capital to play with these risks, welcome. And the timing, you have the privilege to go in and out of a stock whenever you feel like it. We don't. We're in boots and all, money and all, family and all, we can't trade shares. So we're quite restricted. I've allocated 10 years to this project, means you better ready pay off. So you can't get more commitment than that, you know, sincerity. So I do appreciate the frustration from your distance, but I also thank you for your persistence as well. But the fact that you're on this will now demonstrate you have some interest. And I do thank you for that and let's just finish.

Perfect, Harry. Thank you very much for updating investors today. Could I please ask investors not to close the session as you now be automatically redirected to provide your feedback in order that the management team can better understand your views and expectations. This will only take a few moments to complete, but I'm sure it will be greatly valued by the company. On behalf of the management team of KEFI Gold and copper plc, we'd like to thank you for attending today's presentation, and good morning to you all.