Ethiopia Aims to Become a Major Gold Producer With New $340 Million Mine

Ethiopia

Ethiopia has taken a significant step toward becoming one of Africa’s next major gold producers after securing approximately $340 million in financing for the long-delayed Tulu Kapi gold project. The funding clears the way for full-scale construction of what is expected to be one of the country’s largest modern gold mines.

The financing package includes approximately $240 million in long-term loans from African development lenders and around $100 million in equity, providing KEFI Gold and Copper, the project’s developer, with the capital to commence major works. Early preparatory activity, including housing development, power connections and road access, is already underway as the site prepares for a broader build-out.

Located about 360 miles west of Addis Ababa, the Tulu Kapi mine is projected to produce about 164,000 ounces of gold per year during its first seven years of operation, with commercial output targeted for late 2027. If it reaches those levels, the mine would generate substantial export revenue and bolster foreign exchange earnings at a time when Ethiopia is seeking new sources of hard currency.

The project is being developed in partnership with the Ethiopian government, which holds a carried interest and has committed to an equity stake. Officials in Addis Ababa have promoted mining as a strategic pillar of economic growth, with gold being seen as a key contributor to export earnings and investment attraction, following years of underinvestment in the sector.

Ethiopia’s broader mining ambitions come as gold prices remain high globally. The government and investors are positioning the country not only to increase production at Tulu Kapi but also to draw additional private capital into its largely untapped mineral resources, which analysts say could help diversify the economy and create jobs outside agriculture and services.