Addis Ababa
February, 1998
Table of Contents
| |
| 1. Overview of Economic Policy | |
| 2. Background to the Mineral, Petroleum and Energy Sector | |
| 3. Sector Policies and Strategies | |
| 4. The Mineral Subsector | |
| 4.1 Geology and Mineral Resources Potential | |
| 4.2 Current Status of the Mineral Subsector | |
| 4.3 Mining Legislation | |
| 4.4 Procedure for Licensing of Mineral Investment | |
| 4.5 Checklist to Submit Application for Mineral Operations
License | |
| 4.6 Potential Areas of Investment | |
| 4.7 Specific Investment Opportunites in the Sector | |
| 5. The Petroleum Subsector | |
| 5.1 Ethiopian Petroleum Potential | |
| 5.2 Current Petroleum Exploration and Development Activities | |
| 5.3 Potential Areas of Investment | |
| 5.4 Procedures for Acquiring a Petroleum License | |
| 6. The Energy Subsector | |
| 6.1 Energy Resource Potential | |
| 6.2 Status of the Subsector | |
| 6.3 Potential Areas of Investment |
1. OVERVIEW OF ECONOMIC
POLICY
In mid-1991 the previous military regime ended, and a new government
was installed.
At that time, the economy was to a large extent under the dominance
of the state which
controlled both product and factor markets, and owned a large
part of the modern
sector of the economy. There were severe price distortions of
foreign exchange and
interest rates as well as of goods and services. Since then, the
focus of economic policy
has been to switch from a command to a market economy and progressively
integrate
Ethiopia into the world market.
The first task was to dismantle the legal restrictions on private
investment and
withdraw the state from controlling prices and markets. To this
end, domestic and
external trade were liberalized, state monopolies were abolished,
and, at the same
time, public enterprises were made autonomous in terms of management
and finance,
cut off from budgetary support, and made subject to eventual divestiture.
Simultaneously, integration with the global market was initiated
through reduction of
import tariffs and devaluation of the Birr (Ethiopia's
currency). The maximum tariff rate
was reduced from 230 to 80 per cent, while the Birr was devalued
by 142 per cent
against the US dollar. These measures changed the course of the
economy within a
relatively short period of about two years, between mid-1991 and
1993, bringing into
operation market forces and removing substantially price distortions.
In subsequent years, the establishment of a market economy and
integration with the
world market was further reinforced. The foreign exchange auction
market for import of
goods was fully deregulated, and the auction itself was held more
frequently, changing
from biweekly to weekly. Availability of foreign exchange for
payments of invisibles,
such as business travel and medical treatment abroad, was also
increased. Import tariffs
were further reduced from a maximum of 80 to 50 per cent; the
average rate being
presently 24.5 per cent. Price controls which remained on a few
essential goods were
lifted, thereby virtually completing the deregulation of prices
of goods and services. In
addition, petroleum prices were made periodically adjustable to
reflect changes in world
price. Pan-territorial pricing of fertilizer was terminated as
was fertilizer subsidy.
Tariffs of electricity and water were adjusted upwards, the former
being scheduled to
cover costs fully and allow a profit margin in the coming few
years.
Telecommunications, on the other hand, continues to be operated
on profit basis.
Privatization gathered momentum after
an initial phase of preparation. Given the
underdevelopment of the economy, there are only about 200 state-owned
enterprises to
be privatized including factories, state farms, hotels, construction
firms, transport
corporations, wholesale marketing firms, and small retail outlets
and restaurants. State-
owned marketing enterprises lost their monopoly with the removal
of entry barriers for
private firms, and shrank due to both deliberate down-sizing and
competition, while
insolvent enterprises that could not be resuscitated were allowed
to go bankrupt. Retail
shops, restaurants, a few factories and hotels have been privatized.
Several other
enterprises have also been offered for sale.
Currently, the main focus of the on-going economic reform is the
widening of the scope
of foreign investment to include telecommunications and electricity
generation,
complete the liberalization of the current account, and the deregulation
of interest
rates side by side with the creation of securities market. In
keeping with the objective
of progressively liberalizing the foreign trade regime for goods
and services, payments
on invisible trade are expected to be deregulated fully by the
end of 1990s. This will
enable Ethiopia to attain current account convertibility. At the
same time, the
maximum tariff on imports will be reduced and the average rate
lowered to 19.5 per
cent.
To summarize, a transition from a
command to a market economy has been made. There
remain, of course, several scores of enterprises in the hands
of the state, but essentially
due to the process of undertaking privatization itself, rather
than lack of readiness to
privatize. Perhaps more challenging is the elimination of price
controls, removal of
subsidies, commercialization of telecommunications and electricity,
and convertibility
on the current account. In all these areas, the achievement in
policy reforms has been
remarkable, as Ethiopia has succeeded to establish a market economy,
with minimal
price distortions and successively decreasing tariff rates, on
a sustainable footing.
2.BACKGROUND TO THE MINERAL, PETROLEUM AND ENERGY SECTOR
Ethiopia is a land rich in mineral
resources of which gold, tantalum, soda ash, potash,
nickel and platinum are the most likely candidates for development
either by local or
foreign investment. Although it has been repeatedly said that
the national mineral wealth
potential is enormous, the sector's contribution to the national
economy is less than one
percent.
Between 1974 - 1991, private investments
were not allowed in the mineral sector; rather
the government was fully responsible for the exploration and development
of the sector.
As the development of mineral resources requires huge investment,
advanced
technology and trained manpower, the government could not easily
bring the mineral
sector to a significant stage of development.
The new economic policy of Ethiopia
permits and fosters the investment of private
capital and has created a conducive environment for the participation
of local and foreign
companies in the development of the mineral sector. This was manifested
by the
introduction of liberalized Mining and Income Tax Proclamations
in 1993 and the
supporting Mineral Operations Regulations in 1994.
The new Mining Proclamation provides
the license holder a number of incentives such
as low royalties; exemption from custom duties and taxes on equipment,
machinery,
vehicles and spare parts necessary for mineral operations; and
a 10 year loss carry
forward.
The future of the mineral sector
is now firmly allied with private investment. The new
Mining Proclamation recognizes the significant role of private
investment in capital
formation, technology acquisition and marketing of minerals. This
is a very positive step
forward from the earlier policies of a complete monopoly of the
sector by the
government.
The Legedembi primary gold mine,
which is the only modern mechanized large scale
mining operation, has currently been privatized by signing a sales
contract with National
Mining Corporation, a foreign-owned mining company. This shows
the commitment of
the government to encourage private investors in the mineral sector.
The resource potential of petroleum
and other types of energy is also highly promising.
Potential petroleum development areas have been selected and have
been made open for
private investment. In the areas identified, some geological exploration
activities have
been done and the possibility for the occurrence of oil and gas
has been indicated. The
legal instrument that applies to the petroleum sector was promulgated
in 1986.
Regarding energy, the sector requires
due emphasis in order to develop at a pace that will
sustain the country's economic
and social development. The potential of Ethiopia's
renewable and non-renewable energy resources is enormous. Currently,
however, less
than 4% of the population is supplied with electricity. The majority
of the population
still uses traditional sources of energy mainly biomass that is
resulting in massive
deforestation.
This brochure is prepared to give
a brief idea on the mineral, petroleum and energy
resources of Ethiopia, and to outline the potential areas of investment
in the sector. For
this purpose, sector policies and strategies are presented next.
This is followed by a
discussion separately of the mineral subsector, petroleum subsector
and energy
subsector, respectively. For each subsector, effort has been made
to indicate the
available resources of the country that may be further explored
and developed by
investors. Additional and more detailed information may be obtained
from the Ministry
of Mines and Energy which warmly welcomes investors wishing to
participate in the
development of these sectors.
3.SECTOR POLICIES AND STRATEGIES
Geological studies conducted so far in the country suggest that
Ethiopia is endowed with
a favorable geological environment that hosts a wide variety of
promising mineral
resources. These explorations have confirmed the existence of
deposits of gold,
platinum, tantalite, soda ash, phosphate, dimension stones, geothermal,
petroleum and
other metallic, industrial, and chemical minerals. Despite all
these occurrences, mineral
development remained to be limited. During the years between 1974
- 1991, all
exploration and development activities of mineral resources were
done under the
government monopoly. Private individuals were only limited to
the exploitation of some
construction minerals at a small-scale level.
To improve the situation in the mineral subsector steps have been
taken to encourage
the participation of private investment. This was clearly witnessed
in the transitional
government economic policy as well as the five year plan of action
for peace, democracy
and development. To this effect, the Ministry of Mines and Energy
has identified areas for
development in the subsector. As a matter of policy there is no
restriction for the participation
of private investment in the development of any type of mineral
resources. The policy
document of the mineral subsector reflects the importance of:
To implement the policy objective, a strategy has been laid down
by the Ministry. The
main strategies are to:-
The potential areas for petroleum resources are classified in
their respective
occurrence basins; Ogaden Basin, Mekelle Basin, Abbay Basin and
Gambella Basin.
Out of these, the Ogaden Basin has been extensively explored by
the government and
international oil companies. The largest sedimentary basin with
a commercial discovery
of gas condensate field, the Calub Gas Field, is situated in the
Ogaden Basin.
The policy towards the petroleum subsector is similar to that
of the mineral subsector.
The major policy objectives and strategies mentioned above are
also applicable here.
The subsector is expected to be developed by international oil
companies by allocating
risk capital for the exploration and development of petroleum
resources. The
government comes into the picture when commercial discovery is
obtained and
exploitation begins.
For the great majority of the population, woody biomass is the
only source of energy.
The modern segment of the energy subsector is very small and relatively
few people
have access to modern energy supplies. The total per capita consumption
in 1995 was
estimated to be 0.29 Tons of Oil Equivalent (TOE) of which only
about 0.02 TOE was
generated from modern energy sources (electricity and petroleum),
while the remaining
was secured from wood and other biomass fuels.
The new energy policy is now being implemented with the objective
to reduce the
misuse of energy, pollution and imbalance of natural resource
utilization. Among the
objectives and priorities of the policy are the following:
Following the policy, the government has revised the current legal
and regulatory
framework of power generation, transmission and distribution,
and finalized the electric
law. To administer activities related to electricity, a government
institution called
Ethiopian Electric Agency has been legally established by Proclamation
No. 86/1997.
The main objective of the Ethiopian Electric Agency is to promote
the development of
efficient, reliable, high quality and economical electricity services.
There is also a policy shift regarding the generation of electricity
so as to allow private
investment in the generation of electric power in the country
which was previously
monopolized by the Ethiopian Electric Power Corporation. The investment
law of the
country allows the participation of private investment in electric
power generation.
4. THE MINERAL SUBSECTOR
4.1 Geology and Mineral Resources
Potential
Highland Ethiopia is underlain mainly
by Tertiary volcanic, mostly basalt. The Rift
Valley, which divides the Ethiopian highlands into the eastern
and western plateaus, is
underlain by Tertiary as well as Quaternary volcanics and sediments.
These include
important deposits of salt, diatomite, bentonite, sand, scoria,
and various rock types
useful for construction. The younger volcanics, especially the
Quaternary volcanics, are
sources of geothermal steam and mineral water.
Rocks of Mesozoic age are mainly
sediments such as sandstone, limestone and gypsum.
They cover the whole of the eastern lowlands of Ethiopia and large
areas of Harar, Bale,
Borena, Tigray. They also occur in the upper valleys of the Blue
Nile and its tributaries in
central Ethiopia. The Mesozoic formations are important exploration
targets for oil and
gas as well as sources of raw materials for cement, glass and
lime production. They also
supply materials for the construction industry. The Paleozoic
formation are sediments
localized in restricted areas in Tigray in the north, the Blue
Nile Basin in the center, the
Ogaden Basin in the east and the Gillo Basin in the southwest.
A quarter of the country is underlain
by Precambrian metamorphic terrains. Precambrian
rocks are exposed in the northern highlands as well as in the
western, southern and
southwestern lowlands and eastern Ethiopia. They consist of Archean
to Lower
Proterozoic high grade gneisses and Upper Proterozoic low grade
volcanic and
sedimentary rocks of green schist facies associated with metaultramafic
bodies and
acidic and basic intrusions. The low grade Upper Proterozoic rocks
are exposed in the
south, west, southwest and north forming
the Southern, Western, the Southwestern
(the Akobo) and the Northern (the Tigray)
Greenstone Regions, respectively. Most of the known metallic mineralizations
hosted in
these low grade metamorphic rocks is known over a little area
in the east exhibiting lead
and copper anomalies.
The Precambrian rocks host both metallic
and industrial mineral resources. Important
mineralizations include gold, platinum, copper, iron, nickel and
rare metals. Industrial
mineral deposits include feldspar, marble, quartz, kyanite, dolomite,
talc and graphite.
The history of modern mining is recent
in Ethiopia. Mineral prospecting and exploration
began about the end of the 18th century. However, some mining
activities such as iron
mining and salt extraction were known in Ethiopia since time immemorial.
Modern mineral exploration started
in 1968 with the establishment of Ethiopian
Geological Survey as a department within the Ministry of Mines
and Energy to
undertake surveys of the geology and potential mineral reserves
of the country. Since the
establishment of Geological Survey, various mineral exploration
projects have been
undertaken by the Ethiopian government, both on its own and with
the assistance of
donor organizations. Surveys were carried out mostly in the Precambrian
low grade
metamorphic terrains. Exploration activities so far have outlined
priority target areas and
reserve of precious metals (primary and placer gold), platinum,
rare metals, base metals
and iron.
Over the past 25 years, the Ethiopian
Geological Survey has carried out exploration for
metallic and industrial minerals and the results of these studies
are available to investors.
A quarter of the total surface area of the country has been geologically
mapped at
1:250,000 scale, of which 20% has been geochemically surveyed
at same scale. Some of
the known important deposits are: the Adola placer gold, the Legedembi
primary gold,
the Kenticha columbotantalite, the Bwambwawiha kaolin, the Kenticha
quartz, the
Yubdo platinum, the Bikilal phosphate, the Dallol potash, the
Gewane Mille bentonite,
the Lakes Region diatomite, the Lakes Region soda ash, the Daleti
marble and the Adola
nickel.
4.2 Current Status of the Mineral
Subsector
Even though modern mining in Ethiopia
is recent, gold has traditionally been mined from
alluvial and, to a lesser extent, primary free gold since ancient
times. However, modern
gold mining began only in 1930s with the discovery of placer gold
in Bedakesa Valley of
Adola area, southern Ethiopia. Later on, modern investigation
continued and resulted in
the discovery of important deposits of gold, such as Legedembi,
and other minerals.
Other mining activities include the production of tantalite (20
tons per year) and soda
ash (20,000 tons per year), on pilot scale. Mining of kaolin,
dimension stones
(limestone, marble and granite) and small scale and artisanal
mining of precious metals,
gemstone, salt, industrial minerals and construction materials
are the main mining
activities in Ethiopia.
In general, current activities in
the mineral sector are being dominated by the private
sector. Some of the privately owned mining activities include;
the Dalleti marble which
was purchased by the National Mining Corporation (NMC) from the
previous Ethio-
Libyan Joint Mining Company, and Legedembi primary gold mine which
is also
purchased by NMC. Gold exploration activities, which were initially
designed and
implemented in order to increase the production of gold, have
also been given in
concession to private companies.
As a result of the conducive fiscal
and legislative environment, the country is now
enjoying the participation of both foreign and local investors
in exploration and mining.
So far, about 9,400 square kilometers of potential area for gold
and other minerals are
under concession. In addition to 19 local companies, 11 foreign
companies have been
granted prospecting, exploration and mining licenses for gold
and base metals, platinum,
industrial and construction minerals, notably, potash, diatomite
and high quality
ceramics raw materials. The companies came from South Africa,
Canada, America,
Guyana, Italy and Norway. Moreover, relatively new concepts and
models for the local
industry are being tested for exploration of epithermal systems
(outside the well known
gold fields of the greenstone belts) in the Rift Valley volcanics.
Intensive exploration
programs are also being conducted for precious stones such as
diamonds and sapphire
and other gemstones in different parts of the country. Names of
companies who are
currently operating in the country and their license detail are
attached herewith.
For the collection and dissemination
of geological information, ten capital projects are
being carried out by the Ethiopian Geological Survey in different
parts of the country in
the current fiscal year. The projects include two regional mapping,
one hydrogeological
study, two industrial minerals exploration (one for phosphate),
two gold and base metals
exploration, one geothermal exploration, and one for equipping
the geological laboratory
with modern equipment to upgrade the facility. The ongoing exploration
activities which
are being carried out by the Geological Survey will add information
on mineral
occurrences. Such information will be provided to potential investors.
4.3 Mining Legislation
As a result of the political change
that took place in 1991, a new economic policy has
been introduced in the country. In the mining sector, the government
has promulgated a
new Mining Proclamation and Mining Income Tax Proclamation to
encourage the
participation of private capital in mineral prospecting, exploration
and development
activities.
The new Mining and Mining Income
Tax Proclamations were issued in June 1993. The
Mining Regulations came into effect in April 1994. The Mining
Proclamation No.
52/1993 and the Mining Income Tax Proclamation No. 53/1993 were
amended in favor
of investors in 1996. The following are highlights of the laws.
These laws lay the general framework
of rules governing the mining industry in Ethiopia
and:
Invite private investment in all kinds of mineral operation;
Provide one year exclusive prospecting license;
Provide three year exclusive exploration license with two renewal
of one year each;
Provide exclusive mining license for twenty years with unlimited
renewals;
Require adequate health, safety and environmental protection;
Provide for inclusion of minerals which were not originally specified
in the license as
they are discovered;
Guarantee the licensee's right to sell the minerals locally or
abroad;
Provide for exemptions from custom duties and taxes on equipment,
machinery,
vehicles and spare parts necessary for mineral operations;
Guarantee the opening and operation of a foreign currency account
in a bank in
Ethiopia; retention of a portion of foreign currency earning;
and remittances of profits,
dividends, principal and interest on foreign loans etc. out of
Ethiopia;
Provide for 2% government free equity in mining operations;
Require environmental impact study; and
Provide for dispute settlement through negotiation and international
arbitration.
The laws provide for:
Generous deductions and calculations of expenditure;
Ten year loss carry forward;
Write-off of investment within four consecutive years;
35% tax on taxable income generated from mining operation;
10% dividend tax;
2% optional state free equity; and
Up to 5% royalty on an ad valorem basis.
4.4 Procedure for License in
Mineral Investment
In the Ministry of Mines and Energy,
the Mineral Operations Department is responsible
for licensing of prospecting, exploration and development works.
Any person who
possesses financial resource, technical competence, professional
skill and experience
necessary to fulfill the obligation under the license can apply
to the Department.
Application for a license or for its amendment, renewal, transfer,
assignment,
encumbrance or inheritance shall be in the form and contain the
necessary information
specified by the Mining Proclamation and Regulation.
Application can be submitted to the
Department clearly indicating the type of license
required (prospecting, exploration or mining), the geographical
coordinates of the area
and the expected mineral type. The types of licenses issued by
the Department are given
below in Table I.
| Prospecting License | 1 year, not renewable | |
| Exploration License | 3 years plus 2x1 year renewals | |
| Mining License | ||
| Small scale mining | 10 years plus nx10 years renewals | |
| 10 years plus nx10 years renewals | ||
| Large Scale mining | 20 years plus nx10 years renewals | |
| 20 years plus nx10 years renewals |
Foreign entities are required to
be registered through the appropriate government body in
the country. Article 48 of the Mining Proclamation states that,
unless otherwise
permitted or determined by the Licensing Authority, a license
shall be registered in the
Registry of Trade with the appropriate authority and shall maintain
an office in Ethiopia
during the entire term of the license.
Title IX of the Commercial Code applies
to foreign entities as follows:
a. Firms incorporated abroad
having their head office in Ethiopia
Firms incorporated abroad and whose head office or principal place
of business is in
Ethiopia shall be subject to all the provisions of the Commercial
Code and the
regulations made thereunder, including provisions relating to
memorandum of
association.
b. Firms incorporated abroad
having subsidiary offices or branches in Ethiopia
Firms incorporated abroad and which have subsidiary offices or
branches in Ethiopia,
with permanent representation, shall be subject in respect of
each office or branch to
the provisions of the Code relating to deposits and publication
of the memorandum of
association and publication of balance sheets. Such firms shall
publish the names of
persons representing them permanently in Ethiopia, and shall furnish
their signatures;
and shall be subject as regards their branches or subsidiaries
to the provisions
governing the operation of the enterprise and imposing special
conditions.
c. Foreign firms which differ
from the forms of Ethiopian business organizations
Firms incorporated abroad, which differ from those covered by
the Code, shall be
subject to those provisions of the Code concerning share companies,
which relate to
the publication of the acts of the firm and the liability of directors.
Before issuing a license for mineral
operation an agreement will be negotiated between
the Ministry and the investor.
4.5. Checklist To Submit Application
For Mineral Operations Licenses In Ethiopia
An application for prospecting, exploration
and mining licenses shall contain
information specified by the Mining Regulation No. 182/1994. Therefore,
applicants are
requested to properly follow the checklist below.
a) Application for Prospecting
License
Application for prospecting license
will be received and registered when it contains the
following particulars:
(i) Where the applicant is a natural person:
· Full name,
· Nationality,
· Place and date of birth,
· Profession,
· Place of residence and address,
· The
type of mineral and geographical coordinates of the proposed area
at 1:250,000 or
1:50,000 scale,
· Any license or other mining right the applicant has previously held in Ethiopia,
· Description
showing the applicant's financial situation, technical competence
and
experience,
· Work program, and
· Expenditure
proposed to carry out the work program.
(ii) Where the applicant is a legal person:
· Name of the legal person,
· Nationality,
· Legal form,
· Capital,
· Address of its head office, name and address of its representative in Ethiopia,
· The
following documents duly certified by the appropriate officer
of such entity;
copies of memorandum and articles of association,
copies of the latest annual report of the board of directors, if available,
copies of the balance sheet, profit and loss statement and auditors
reports for the
previous three years, if available,
a list of the members and names of the board of directors,
showing the address and nationality of each, and any other person
authorized to sign
on behalf of the applicants,
the type of mineral(s) requested,
the location of the proposed area: the name of the administrative
region, localities
and geographical coordinates,
topographic map at 1:250,000 or 1:50,000 scale showing the proposed area,
copies of any license, or other mining right the applicant has
previously held in
Ethiopia,
description showing the applicant's financial situation,
description showing the applicant's technical competence and experience,
the yearly work program, time schedule, material and manpower
(according to
profession) distribution as well as total yearly expenditure the
applicant proposes to
carry out and incur during the time of the license,
other reasonably requested information by the licensing authority.
b) Application for Exploration
License
Application for exploration license
will be received and registered when it contains the
following particulars:
c) Application for Large Scale
Mining License
Application for large scale mining
license will be received and registered when it
contains the following particulars:
4.6 Potential Areas of Investment
The country's mineral resource is
untapped despite its enormous potential. This is
exhibited by the very low contribution of the sector to the national
economy. The
government's intention in the future lies in the collection of
basic geological information
and delineation of the possible mineral occurrences for potential
investors.
Potential investment areas in the
mineral sector are concentrated in the Adola,
Ageremaryam, Moyale, Western Akobo and Tigray greenstone regions.
The details of
each greenstone region is discussed briefly below.
a) Adola Greenstone Region
The Adola belt is 20-25 kilometers
wide and some 150 kilometers long. Adola area is
covered by geological mapping and is underlain by units of the
Precambrian basement
complexes. Only the middle and upper complexes have been studied
in any detail. These
have been deformed in linear north-trending folds, which have
been cut by deep-seated
longitudinal faults, and flexures trending northeast and northwest.
The Upper Complex,
the Adola volcano-sedimentary sequences, is confined to the 20-25
kilometer-wide
Megado graben-syncline. The syncline is a down faulted and folded
block bordered by
the higher metamorphic grade Middle Complex units.
A helicopter-borne geophysical survey
was done on the area and magnetometer,
electromagnetic and radiometric data were collected along the
flight lines. The result is
available in hard copy and on CD-ROM. The majority of the known
gold-bearing areas
are in this region. The Kenticha Greenstone Belt, lying 12 to
15 kilometers east of the
eastern marginal thrust of the Adola Belt, contain some gold,
but is chiefly of interest for
nickeliferous laterites and rare metals, associated with ultramafics
and pegmatites, respectively.
Most of the mining activities in
the country is concentrated in this area. Currently,
National Mining Corporation is carrying out exploration for gold
and associated minerals
in this locality and has also purchased the Legedembi gold plant
and the surrounding
deposit of 88 square kilometer area. Placer gold exploitation
is taking place by a state-
owned enterprise in the area. This enterprise is also in the process
of being privatized. In
this same area, ceramic mineral is currently being mined to be
used as raw material for
Tabor Ceramics Factory built in Awassa town.
The area is highly promising for
gold, rare metals, feldspar, quartz, nickel, chromium and
kaolin.
b) Agere Maryam And Arero Greenstone
Region
The Agere Maryam area is some 260
kilometers southwest of the town of Kibremengist
in Borena Zone Oromia National Regional State. The heavy concentrate
geochemical
surveys conducted in this area have located gold anomalism along
a north-south zone
some 48 kilometers long and 4 kilometers wide. In the Ogo Basin,
the coarser gold
grains are probably been derived from quartz veins, whereas the
finer gold is from pyrite
which is found as disseminations and stringers, predominantly
in graphitic quartz-mica
schists. Overall, the low-metamorphic grade schists are the host
for the gold in this basin.
During the regional lithogeochemical
survey, tantalum dispersion trains were located
over the gneisses of the Buluka and Bore formations. The anomalism
has associated Nb,
Li, Sn, Pb and Mo. These, coupled with the high tantalum contrast
between background
and anomalous contents, suggest that they are related to rare
earth mineralization, and
hypothetically linked paragenetically to albitite apogranites
formed by metasomatism.
The Arero Greenstone Region is some
100 kilometers south-west of the town of
Kibremengist. It is the southern extension of the Adola Greenstone
Belt. Regional and
follow-up heavy concentrate surveys, regional and follow-up lithogeochemical
surveys,
and detailed prospecting and exploration surveys were conducted
in selected parts of the
area.
The regional heavy concentrate work
demonstrated that high gold contents were
associated with high contents of pyrite. The auriferous pyrite
occurs in metabasic and
meta-ultramafic lithologies. Bismuth, tin and tungsten anomalies
are confined to a
northwest trending zone which crosses the regional structure and
lithologic trend. It was
suggested that this granitophyllic type mineralization is controlled
by a north west
structure.
Three types of mineralization were suggested in the area:
Gold related to pyrite bearing metabasic and meta-ultrabasic rocks
which are confined
to two zones within a northwest trending zone;
Cr, Co, Ni, V related meta-ultramafic rocks occurring along deep
seated faults or
perhaps along a northeast trending thrust zone; and
Bi, Sn, W related to intermediate-to-acid alkaline intrusions
occurring as dikes and
veins within metabasic to meta-ultrmafic rock units. These are
confined to a northwest
trending metallogenic zone discordant to the general regional
geologic trend.
The lithogeochemical surveys resulted
in dividing the Arero area broadly into east and
west geochemical blocks, separated by a thrust or deep seated
fault zone. The east block
is characterized by acidic intrusions, and the west block by metabasic
and meta-
ultramafic intruded by basic and acidic dikes, pegmatites and
quartz veins.
c) Moyale Greenstone Region
The Moyale Greenstone region is in
southern Ethiopia, on the border with Kenya. Owing
to its location almost south of the Adola Greenstone Belt and
to similar lithologies, it is
considered to be a southern extension of the Adola Greenstone
Belt.
Moyale Greenstone Region is about
2 kilometers north-northeast of Moyale town. The
geology of the area is relatively simple. A metagranodiorite batholithic
body underlies
the area. It is in tectonic contact with basic to ultramafic rocks
on the east and on the
west. There are many quartz veins in the area. They have three
general orientations:
striking north south (following the general foliation), northeastern
and northwest.
The mineralization in the area is
of two types: gold-sulfide in quartz and gold-quartz
without or with minor sulfide. The gold-sulfide veins are characterized
by appreciable
lead, copper, zinc, and pyrite.
The Hassamte-Haramsem area is located
east of the town of Moyale. The rocks in this
area are metagranodiorite, amphibolite, amphibolitic gabbro, garnetiferous
gabbro,
banded amphibolite and chlorite amphibolite schist. Primary gold
is found in both
amphibolite and granodiorite. There are different generations
of quartz veins with visible
and invisible gold. The most prominent are quartz veins filling
extensive gash fractures
of the shear zone in the granodiorite. The intensely sheared part
of the amphibolite
contains fine, disseminated pyrite and chalcopyrite mineralization.
The intensity of
mineralization is related to the intensity of alteration and shear-zone
fracturing.
d) Western Greenstone Region
The predominant lithologies of the
western Greenstone belt are chlorite, sericite and
graphitic schists, phyllites, quartzites, and andesitic to rhyolitic
volcanics. Iron-bearing
quartzites and intraformational conglomerates are also present.
The metamorphic grade
is no higher than upper green schist to lower amphibolite facies,
but commonly does not
exceed lower green schist facies. The area is underlain by a plutonic
basement of
metadiorite-granodiorite, unconformably overlain by the metavolcanic-metasedimentary
sequence of the late Proterozoic Tsalet group.
Under the Western Greenstone Region
the following potential areas are identified:
Gold and base metal deposits.
Azale-Akendayu, located 22 kilometers south-east of the town of Kurmuk,
Ashashire,
Boka-Dalleti-Bindakoro,
Oda-Godere,
Mount Dul,
Ondonok, located some 55 kilometers northeast of the town of Assosa,
Tulu Kami, located 4.5 kilometers east of Nejo,
Metti,
Lega Baguda, located 48 kilometers southeast of Yubdo,
Chokorsa, located 20 kilometers southeast of Nejo,
Tulu Kapi and Ankori, located some 15 kilometers northeast of Yubdo,
Keta, located 7 kilometers east of Nejo,
Bomu Menghi,
Bascia, located 25 kilometers southeast of Assosa,
Gambella Mountain, located near the border with the Sudan,
Guba, Dura Abelli drainage, Beles drainage, Abumari, Abteselo,
Mekezen.
Platinum Deposits
Yubdo:- the deposit was discovered in 1923 - 1924 and mining was
started in 1926.
Through 1976, approximately 2000 kilograms of platinum concentrate
were produced.
From nearby drainages, nuggets several millimeters across have
been analyzed. They
are a Pt-Fe alloy, with platinum far more abundant than iron.
Dalatti and Tulu Dimtu.
Iron and phosphate deposits
Bikilal, located 18 to 20 kilometers northwest of the town of
Gimbi. The area studied is
underlain by three principal rock groups: Amphibolite and amphibolite
schists, Bikilal
intrusive basic rock and Granite group rocks. The phosphate potential
is in an
apatite-bearing anorthosite gabbro formation. Spatially and genetically
it is associated
with an intrusion of gabbroic rocks.
e) Akobo Greenstone Region
The lithologic units of the Akobo
Greenstone Belt are generally similar to those in the
Western Greenstone Belt and are considered a southern extension
of that terrain. The
rocks here include relatively low grade metasedimentary and metavolcanic
units which
enclose ultramafic lenses. The five general lithologic types in
the Akobo basin
disregarding the plutons, are:
mafic schist and gneiss,
meta-ultramafic bodies,
metasedimentary schists,
marble , and
undifferentiated schist and gneiss.
The Akobo basin merits prospecting
for platinum as well as for gold and other metals
such as copper and nickel.
f) Tigray Greenstone Region
The Tigray Greenstone Region is located
in northern Ethiopia. The late proterozoic
Tsaliet group is well developed in this region and consists of
propylitized andesites and
diabases, tuffaceous slates and graywackes. This predominantly
volcanic sequence
merges into the overlying Tambien group. The main rock types in
this group are slate and
shale-commonly graphitic-with interbedded limestones. Small bodies
of pyroxenite and
serpentine are found in western Tigray. Metamorphism has reached
the green schist
facies as a rule, although locally it has reached the amphibolite
facies.
Mineralization in the known deposits
is predominantly pyritic, with associated copper,
zinc and lead sulfides. Base-metal occurrences and geochemical
indications are found in
a number of areas in the Tigray region. Copper occurrences and
geochemical anomalism
are found associated with the Tsaliet metavolcanics in the lower
Werri and Tsaliet river
drainage as well as west-central Tigray. Lead and Zinc anomalies
in soils are present at
Mariam Adi Destra, southeast of Hauzien, trending across the Giva
river.
The mineralization of copper prospect
at Tsehafi Emba occurs within a meta-gabbro
associated with other metamorphosed intrusion, all forming a syntectonic
complex. This
complex, known as the Firfira, lies within the low grade, regionally
metamorphosed
volcanics and sediments of the late proterozoic Tsaliet group.
g) Ethiopian Rift Zone
The Ethiopian rift zone forms a valley
that cuts through Ethiopia in a general north-
north-east direction. It is a graben, the failed arm of the Red
Sea Gulf of Aden triple
junction, which was formed during the opening of what are today
the Red Sea and the
Gulf of Aden. As the Rift Valley approaches Djibouti, the western
boundary faults turn to
a more northerly direction, forming the Afar and Danakil Basins.
The Danakil depression is some 120
meters below sea level and is east of the normal
fault zone that borders the Precambrian schists of the Tigray
Greenstone Region. Major
potash deposits exist near mount Dallol within the Danakil depression.
There are surface
deposits of salt and sulfur, shallow manganese deposits, and subsurface
evaporite
deposits of potash salt.
The soda ash resource is located
approximately 200 kilometers south of Addis Ababa.
The waters of Lake Abijata, Shala and Chitu have medium to high
salinity and contain
sodium-chloride-carbonate. Soda ash is being produced from lake
Abijata on a semi-
commercial scale.
Prospectus on mineral investment
opportunities in Ethiopia are available in two volumes
and can be obtained on payment from the United Nations Development
Programme
(UNDP).
Mineral occurrences of the country
is indicated in the annexed colour map.
4.7 Specific Project Opportunities
The following specific opportunities
have been identified for foreign investment. More
detailed information is provided in separate fliers for each opportunity.
Please contact through the following
address the Ministry of Mines and Energy for
further information.
Ministry of Mines and Energy
Mineral Operations Department
P.O. Box: 486
251-1-61 45 73
Fax: 251-1-61 45 74
251-1-61 51 30
Addis Ababa, Ethiopia
|
|
|
|
| ||
| |||||
| National Mining Company |
| 10.197 | |||
| National Mining Company | 210.761 | ||||
| National Mining Company | 422 | ||||
| National Mining Company | 26.915 | ||||
| |||||
| Golden Star Resources LTD. | 1800.84 | ||||
| Canyon Resources Africa Ltd. | 59.98 | ||||
| Roraima Mining Comp. Ltd. |
| 70.22 | |||
| Tan Range Exploration Corporation |
209.458 | ||||
| St. Genevieve Resources Ltd. | 524.875 | ||||
| Canyon Resources Africa Ltd. | 108.425 | ||||
| Asteria Srl. | 105.9609 | ||||
| Rift Resources |
| 742.225 | |||
| |||||
| Diadem Resources Ltd. | 200 | ||||
| Canyon Resources Africa Ltd. | 1047.29 |
5. THE PETROLEUM SUBSECTOR
5.1 Ethiopian Petroleum Potential
The sedimentary regions of Ethiopia
cover a significant portion of the country and
comprise five distinct sedimentary basins, namely: the Ogaden,
BlueNile, Mekele,
Gambella and Southern Rift basins. The development of most of
these basins is related
to the extensional geodynamic tectonics that have taken place
intermittently since the
Late Paleozoic and continued up to the Tertiary.
The Ogaden, Blue Nile and Mekele
basins are presumed to be cratonic rift basins
formed as a result of extensional stress induced by the break-up
of Gondwanaland in the
Late Paleozoic. The Ogaden Basin, located in the area extending
from the east to
southeast part of Ethiopia, is constituted of triaxially rifted
troughs trending NW-SE, N-
S, and E-W. The Blue Nile (Abbay) Basin is a NW-SE trending branch
of the Ogaden
intercontinental rift basin. Thick Permo-Triassic sediments, ranging
from continental
fluviatile and deltaic clastics to marine argillaceous types,
were deposited in the Ogaden
region in the early rifting stage. Equivalent sediments are also
represented in the Blue
Nile and Mekele basins.
Continued large scale down wrapping
of the entire East African continent took place
during Upper Triassic to Lower Jurassic time and fluvio-deltaic
sediments were
deposited over a large area, extending up to the western and northern
regions of Ethiopia.
Further rifting and subsidence of the region, including the Saudi
Arabia and Yemeni
areas, led to the transgression of the sea from the east and southeast,
flooding an
extensive area; this event is probably related with the tectonics
of separation of
Madagascar from the Africa coast and evolution of the Indian Ocean.
Marine sediments
varying from the Africa coast types, were deposited over a large
area, although the
sedimentary facies were controlled by sub-basins formed by recurrent
faulting and tilting
of fault blocks during the Jurassic. The NW-SE trending basins
of Yemen and northeast
Somalia are believed to have been formed by the Jurassic rifting
and subsidence events
in the Horn of Africa and southern Arabia.
The regression of the sea from the
region began in the upper Jurassic as the result of
arching and doming of the Arabian-Somalian massif, and sediments
of varying
facies(restricted marine, lagoonal and supra tidal to inter-tidal)
were deposited in
structurally controlled domains. By the early Cretaceous, the
sea completely withdrew
leaving behind regressive continental clastics, mainly consisting
of sandstones.
The Gambella Basin is part of the
Central African Rift System. The southern Sudan
basins and the Anza Basin of northern Kenya also failed in rift
basins of the Central
African Rift System. The Gambella Basin is the southward continuation
of the Melut
Basin of south Sudan and probably extends to join the Anza Graben
in the southeast.
These fault-bounded basins, with a general NW-SE trend, contain
thick fluviatile,
lacustrine to marine sediments reaching thicknesses of 6 to 10
Km.
Paleogene rifting, along with volcanism
was responsible for the formation of the N-S
striking extensional rift basins of the southern Ethiopia, that
are linked with similar
features in northern Kenya. Prominent among these rift basins
are the Omo and Chew
Bahir basins; the former being more or less the northern continuation
of the Turkana
Graben of north Kenya. The rift basins in the region are thought
to contain
fluviolacustrine sedimentary strata not less than 3 to 4 Km in
thickness.
Generally about 40 percent of the
country is covered by sedimentary rocks of Permo-
Triassic continental to deep marine sediments and Cretaceous rift
sediments and these
are prospective for petroleum resources.
5.2 Current Petroleum Exploration
And Development Activities
The largest sedimentary basin with
a commercial discovery of a gas condensate field, the
Calub Gas Field is situated in the eastern part of the country.
The basin has an area of
350,000 Sq. Km. and sedimentary thickness of up to 10,000 meters.
The reserve
potential of Calub gas field is proved to be 2.7 TCF and this
resource is under
development for production.
The government has established Calub
Gas Share Company with a large part of the share
belonging to the government. Now with its serious interest in
involving private
investment in all economic sectors in the country, the government
has decided to
privatize 100 percent of its share and actions are being taken
towards this end.
Currently, one international oil
company, Ethiopia Hunt Oil, has concession for
petroleum exploration in Ethiopia, and interests for exploration
and development are
increasing as evidenced by the growing number of companies enquiring
about petroleum
prospects.
Recent assessment of the hydrocarbon
potential of Ogaden Basin was included in the
study made by Alconsult International Ltd. on behalf of the Canadian
International
Development Agency (CIDA). The study is part of a larger study,
the East Africa
Regional Hydrocarbon Study which involves the participation of
Ethiopia, Kenya,
Madagascar, Mauritius, Mozambique, Seychelles, South Africa and
Tanzania. The
assessment proved that the Ogaden basin is reasonably a prospective
area for petroleum
resources.
5.3 Potential Areas of Investment
a) The Ogaden Basin
The Ogaden basin is located in the
southeastern region and occupies an area of 350,000
square kilometers. The basin is characterized by deep, asymmetrical
grabens separated
by internal highs. The sedimentary succession reaches a thickness
of 10,000 meters in
the deeper parts and is comprised of non marine to deep marine
clastics, very thick,
shallow-to-deep marine carbonates and evaporites. Petroleum exploration
activities in
the basin were carried out by a number of international companies
during the last 37
years and it is found to be prospective for petroleum. And hence
the basin has attracted
the attention of several companies involved in the oil industry.
b) The Abbay (Blue Nile) Basin
The Abbay Basin, which covers a large
area over the central northwestern plateau of
Ethiopia, consists of a thick Mesozoic sedimentary succession
exceeding 1600 meters in
thickness.
Beds of marl, variegated shale and
mudstone interbedded with carbonates, and marly
limestone-dominated beds in the lower part of thick limestone
unit are potential source
rocks in the Abbay Basin. These beds have similarities to the
Jurassic series of the
Middle and Upper Hamanlie, which in many instances have proven
oil source potential
in the Ogaden.
The most potential reservoir rock
in the Basin is the Upper sandstone which consists of
fine to medium grained, friable, moderately to well sorted sandstones,
associated with
thin beds of conglomerates and claystones. Laterally restricted
oolitic-reefal limestone
facies in the lower and upper-most parts of the Antalo Formation
and dolomite beds
within the mudstone-dominated unit overlying the Antalo Formation
might also be
considered as potential reservoir intervals in the Mesozoic sequence.
The Antalo
Formation in the Blue Nile is equated to the upper Hamanlie of
the Ogaden Basin. The
Adigrat sandstone remains a potential reservoir in the Blue Nile
Basin, with
characteristic similar to those found in the Ogaden Basin.
Interbedded gypsum and shale beds
within the unit that stratigraphically overlies the
Antalo Formation appear to be potential sealing rocks. Shale and
clay intervals in the
upper part of the Adigrat formation could also serve as sealing
rocks.
c) The Mekele Basin
The Mekele Basin has an aerial coverage
of about 8,000 square kilometers and is located
in the northern part of the country. The thick Mesozoic sedimentary
succession of the
basin comprises sediments ranging from fluvio-lacustrine to deep
marine origin. The
whole sedimentary sequence reaches 2,000 meters in thickness.
The Upper Jurassic Agula Shale Formation,
predominantly comprised of shale,
marlstone and variegated clay beds (with limestone and gypsum
interbeds) is presumed
to have good source rock potential for hydrocarbons. The upper
part of the Antalo
formation, composed of beds of mudstone, brown shale and greenish-black
limestone
interbeds, could also be considered to be of potential source
quality for petroleum
generation.
The transgressive to braided-fluvial
sandy Adigrat formation, with a thickness ranging
between 150 meters to 600 meters of medium-to-coarse-grained,
grayish-white to pink-
red sandstone (with intervals of silt, clay and shale) is potential
reservoir; as it is in the
Ogaden and Blue Nile Basins.
Marl, shale and mudstone beds in
the upper portion of the Antalo formation could offer
seal potential for any carbonate-reservoired hydrocarbons, or
where laterally juxtaposed
against sandstone reservoirs as a result of faulting.
d) The Gambella Area
The prospectivity of the Gambella
area for hydrocarbons needs to be viewed along with
the South Central Sudanese basins, which are renowned for oil
pool discoveries. The
Gambella area is the south eastern extension of the Melut basin
where two oil
discoveries (Adar and Yale) have been found. The source interval
for hydrocarbons in the
Sudan basins is Lower Cretaceous sediments consisting predominantly
of shale with
subordinate sandstone. Hydrocarbons source beds exceeding 1,800
meters thick were
deposited in lakes.
e) The Southern Rift Basins
The Omo and Chew Bahir basins lie
within the broadly rifted zone of the southern
Ethiopia bordering northern Kenya. Both are extensional basins
bounded by N-S striking
faults which are assumed to be younger features that cross-cut
older NE and NW
striking faults of the area. The northern part of the Omo and
Chew Bahir basins are
presumed to be northward continuation of the Oligocene rift system
of north Kenya.
Organic-rich oilshale with an average oil yield of 8 lit/ton occurs
in a regionally WSW-
ENE extending Tertiary basin in the northern part of the southern
rift basin.
These five potential areas are indicated
on a colour map which is annexed herewith.
5.4 Procedures for Acquiring
a Petroleum License
An application in respect of a block
will be presented in a sealed envelope. Application
may be made by a company or a group of companies. An applicant
can apply for more
than one block at a time.
Application should be submitted in
five copies to the Petroleum Operations Department,
Ministry of Mines and Energy, and should contain the following:
a) The identification of the block(s) for which the application
is made;
the name and address of the applicant in full;
the nature of its business;
the place of incorporation;
the principal place of business;
evidence of the financial standing and technical qualification
and experience of the
applicant, including a copy of the most recent audited accounts
of the applicant and any
body corporate having control of such applicant; and
the name and address of a duly authorized agent in Ethiopia, if
such agent has been
already appointed by the applicant at the time of application.
(c) Where the application is made by a group of companies, information
under paragraph
(b) will be provided by each company; the name of the operator
and the participating
interest of each company will be also provided.
d) The terms proposed by the applicant in respect of the major
aspects of the model
agreement.
There is a model petroleum agreement
in the form of production sharing contracts to be
signed by the government and the contractor.
Petroleum promotion document which
describes each potential areas in detail can be
obtained from the Ministry on payment. Investors who would like
to refer to this
document can contact:
Petroleum Operations Department
Ministry of Mines and Energy
61 45 23 or 61 45 22
Fax. 61 51 30
Addis Ababa
Ethiopia
6. THE ENERGY SUBSECTOR
6.1 Energy Resource Potential
Similar to the promising geological
environment, Ethiopia is endowed with a wide
variety of energy resources, both renewable and non-renewable.
Ethiopia's renewable
resources include forest biomass, hydropower, geothermal, solar
and wind energy.
Available data suggest that the major energy potential of the
country lies in biomass and
hydropower, estimated at 1,405 Tons of Oil Equivalent (TOE) and
30,000 Megawatt
(MW), respectively. Electricity generation potential from geothermal
energy is so far
estimated at 700 MW.
Hydropower is probably the most important
source of energy in Ethiopia for many years
to come. All of the country's
basins have enormous potentials, though to varying
degrees, for the generation of electricity. The Omo-Giber River
Basin has long been
recognized as an area with great potential for development. The
Blue Nile Basin
provides ideal sites for hydropower generation on the upper plateau
where good reservoir
sites with low evaporation losses have been identified. Probably,
this Basin represents
the highest hydropower generation potential of the country with
an estimated 10,000
MW of potential capacity. Other important basins having suitable
sites for power
generation include the Tekeze River Basin, Baro-Akobo River Basin,
Wabe Shebele
River Basin and Genale-Dawa-Weyib Rivers Basin.
6.2 Status of the Subsector
Despite the considerable resource potential, none of the above
mentioned resources
has been exploited in substantial amount except for biomass. The
hydropower
development contributes only 1% to the total energy production
and virtually none of
the geothermal resources has been exploited. Currently measures
are being taken by
the Government to exploit a very small portion of geothermal resources
for electric
power generation and the power plant is planned to be commissioned
in 1998.
For the great majority of the population, woody biomass is the
only source of energy.
The modern segment of the energy sector is very small and relatively
few people have
access to modern energy supplies. The total per capita consumption
in 1995 was
estimated to be 0.29 Tonnes of Oil Equivalent (TOE) of which only
about 0.02 TOE
were generated from modern energy sources (electricity and petroleum),
while the
remaining was secured from wood and other biomass fuels.
The new energy policy, which was approved by the government recently,
is now being
implemented with expectation to reduce the misuse of energy, pollution
and imbalance
of natural resources. Among the objectives and priorities of the
Energy Policy are:-
Following the policy, the government has revised the current legal
and regulatory
framework of the power sector and finalized the "electric"
law. To administer activities
related to electric power generation, transmission and distribution,
Ethiopian Electric
Agency has been legally established by Proclamation No. 86/1997.
The main objective
of the Ethiopian Electric Agency is to promote the development
of efficient, reliable,
high quality and economical electricity services.
The Ethiopian Electric Power Corporation
(EEPCO) is a state-owned corporation
responsible for generation, transmission, distribution and sales
of electricity over the
entire country. Currently, EEPCO maintains two supply systems,
the Inter-Connected
System (ICS) and the Self-Contained System (SCS).
The ICS, consisting primarily of
the large hydro generating facilities, forms the national
grid and supplies Addis Ababa, Nazareth, Dire Dawa, Harar, Jimma,
Shashemene,
Kombolcha, Dessie, Debre-Markos, Bahir-Dar and Gondar. The ICS
is being steadily
expanded to incorporate many of the SCS centres.
The generating facility in the ICS
consists of six hydro (Koka, Awash II and III, Tis-
Abbay I, Finchaa and Melka-Wakena) and two diesel (Dire Dawa and
Alamaya) power
plants. The total installed capacity of the system is 378.1 MW.
Of this total capacity,
only 6.5 MW is from the diesel sources. In terms of total installed
capacity in the
country, the ICS represents about 93% of the total.
The SCS comprises local generation
plants serving small isolated loads through local
sub-transmission and distribution networks. Even though mini hydro
plants do exist in
the SCS, the supply is primarily based on diesel generation. The
system has an aggregate
capacity of 32.9 MW of which 6.3 MW represents the mini hydro
contribution, the
remaining 26.6 MW being diesel. The SCS comprises 7% of the total
installed capacity.
The following table provides the installed capacity in MW of the
two systems, i.e., ICS
and SCS.
|
|
|
| |
|
Hydro | 371.6 | 6.3 |
377.9 |
| Diesel | 6.5 | 26.6 | 33.1 |
| Total | 378.1 | 32.9 | 411.0 |
Transmission voltages of 230 KV and
132 KV and sub-transmission voltages of 66 KV
and 45 KV in both the ICS and SCS are used to transfer energy.
The 45 KV level is being
abandoned in favor of 66 KV. The present network consists of 4,945
Kms of
transmission lines in total.
Power distribution occurs at 15 KV primary and 380/220 V secondary
voltage levels.
The two systems consist of roughly, 7,770 km of the 15 KV lines,
4,162 distribution
transformers, and 5,880 km of 380 V low voltage lines. The following
table provides a
breakdown of the distribution network for the ICS and SCS.
|
|
| |
|
ICS | 6,835 | 3,836 |
| SCS | 935 | 336 |
| Total | 7,770 | 4,174 |
EEPCO presently provides electricity to a total of roughly 500,000
customers in more
than 370 towns and communities throughout the country. Service
is also provided
through self-help schemes and local municipalities though to a
very limited extent. Of
the total number customers 92.2% are within the ICS and the remaining
7.8% within the
SCS. Currently, 5% of the population is estimated to have access
to electricity.
Historical data indicate that the bulk of energy sales is concentrated
in very few large
load centres among which Addis Ababa constitutes the largest portion.
System losses,
as determined from generation and sales figures, stand at 19%
which is roughly 271 Gwh.
Losses in the ICS and the SCS are 18% and 28%, respectively. The
figures represent
both technical and non-technical losses and the major percentage
is attributed to the
distribution network.
Several projects are presently at various stages of development
in the power sector.
The projects will mitigate the short-term power and energy deficits
within the ICS. A
total of Birr 9.0 billion has been earmarked for the projects
which include the
rehabilitation and expansion of existing hydro power generating
plants, the installation
of new hydro and geothermal power plants, and the rehabilitation
and expansion of the
transmission and distribution networks. When completed, the projects
will add a total
of 620 MW to the ICS capacity.
Until recently, EEPCO has remained the
sole agency responsible for the supply and
distribution of electric power nationwide. However, according
to recent policy reforms
and legal proclamations, the business of providing electricity
service is not a monopoly
area anymore. The new electricity law "Electricity
Proclamation No. 86/1997"
has
established a new common legal framework under which EEPCO and
other operators
alike continue to function. This new legal framework lays the
groundwork for promoting
development efforts in sector through, firstly, the provision
of autonomy to EEPCO, and,
secondly, encouraging private investors.
Delineation of regulatory and operational
functions under the new legal framework shall
ensure proper national control to customers in areas of safety
and quality of service. Part
of the legal framework addresses tariff setting and approval processes
with the aim of
ensuring that tariffs are regularly reviewed and adjusted to reflect
economic and
financial objectives.
6.3 Potential Areas
of Investment
Ethiopia has an enormous amount of hydropower resources. Slightly
over 1% of these
resources has been put to use presently. The Government highly
encourages foreign
investment in the area especially in putting up large-scale hydroelectric
power plants
for sale of electricity in bulk to the existing national grid
operated by EEPCO. In this
regard, several opportunities exist in the different river basins
mentioned above. Some
of these opportunities involve small-scale hydroelectric power
plants with capacities in
the order of 30 MW or less. A good number offer possibilities
for installing medium (30
MW - 100 MW) and large-scale (greater than 100 MW) power plants.
There are a
significant number of reservoir sites with possibilities for generating
600 MW - 1,000
MW of power.
The domestic demand for electricity has been growing, on the average,
at 10% per year.
Additional generating capacities should be provided from time
to time to meet this ever
growing demand. Other than the domestic market, there are good
prospects for
exporting electric power to neighboring countries including Eritrea,
Kenya, Djibouti
and the Sudan. Suitable sites in close proximity to these countries
may be selected for
developing export-oriented hydroelectric power plants.
Potash
1. Project title: Dallol Potash
Development
2. Location of the Project:
The Dallol potash deposit is located in the Danakil
depression, in the Afar National Regional State. The Project area
is 110
meters below sea level.
3. Project Summary: The existence
of potash was first noted in 1901.
Between 1901 and 1972 a succession of seven companies had taken
concessions in different parts of the area for exploitation of
potash, and
sometimes magnesium from the hot brines and sulfur. In the period
between 1949 and 1954 one of the companies is reported to have
exported
about 70,000 tons of potash. The most extensive work on potash
was
carried out by the Ralph. M. Parsons company between 1954 and
1968.
The work has resulted in the
definition of proven 66.3 million tons of potash
together with further possible and probable of 32 and 61.9 million
tons,
respectively.
The Ralph M. Parsons company
abandoned its concession when its
underground works were flooded by ground water.
In 1982 a joint venture company,
Ethio-Libyan joint mining company took a
concession in the area with the intent of carrying out a feasibility
study and
eventually entering into mining and refining potash.
The feasibility study has
been planned to be carried out into two phases.
During the first stage of work of the first phase the following
has been
carried out:-
examination of all technical
information available in the reports of previous
concessionaires,
confirmation of the ore reserve
in the quantities that have been established
earlier,
confirmation of the existence
of a mining technique that is appropriate to the
ore body and
determination of any additional
geological exploration work that may be
necessary. As the result of the work of this first stage of the
first phase of the
feasibility study the ore reserve estimation has been confirmed.
It has also been concluded
that 35 million tons of kyanite is also available for
open cast mining. Laboratory tests have shown that the sylvanite
part of the
ore body can appropriately be mined using solution mining technique.
Phase two of the feasibility
study was concerned with the finalization of the
economic and technical evaluation of the project study and preliminary
design of the mine, refinery, production transport and other support
facilities
required.
4. Project Documents Available:
The project had been thoroughly
studied. The documents currently available
in the Ministry include the above mentioned various studies made
on the
deposit and market feasibility study made on Potash, financed
by the
Economic Commission for Africa (ECA), which might require updating
of
the information.
5. Contact Person
Ministry of Mines and Energy
Mineral Operations Department
PO. Box 486
Tel 61 45 73
Fax 61 45 74 or 61 51 30
Addis Ababa, Ethiopia
Soda Ash
1. Project Title: Soda Ash
Industrial Plant
2. Location of the Project:
Abijata, in the rift valley, Southern Peoples
Regional State about 200 Km from the capital, Addis Ababa. There
is
Asphalt road that leads to the proposed project area.
3. Project Summary: The Ethiopian
Rift Valley lakes are known to be rich in
Soda Ash. The reserve is estimated to be 400 to 500 million tons
of
contained Soda Ash, and their development is expected to have
a
significant contribution to the economic development of the country.
A
feasibility study had confirmed that the development of Soda Ash
potential of the lakes; especially Abijata and Shalla Lakes, can
be taken
undertaken in three stages:
Stage 1: a semi-industrial plant of 20 thousand tons of annual capacity.
Stage 2: an industrial plant 200 thousand tons annual capacity.
Stage 3: a layer industrial
plant of up to 1.2 million tons annual capacity.
As a result of the feasibility
study, Ministry of Mines and Energy decided to
initially construct a 20 thousand ton annual capacity semi-industrial
plant
and the plant design and construction supervision was carried
out by Giulini
Chemie (GCG) which is a subsidiary of Israel Chemical Projects
(ICP).
The construction of the 20
thousand tons capacity plant was completed at the
end of 1989 and production is under way.
4. Project Document Available:
The above mentioned feasibility study and
the geological exploration works report done on the area are available.
5. Contact Person
Ministry of Mines and Energy
Mineral Operations Department
PO. Box 486
Tel 61 45 73
Fax 61 45 74 or 61 51 30
Addis Ababa, Ethiopia
Diatomite
1. Project Title: Diatomite
Evaluation and Development project
2. Location of the project:
The project is located in Oromia National
Regional State, 170 km. South of Addis Ababa and 7 km. west of
the
Adamitulu town.
3. Summary of the Project:
The deposits are found in the township of
Adamitulu. The deposits are compact, impure and Miocene to Lower
Pleistocene age. All the deposits are of lake origin. In most
of the deposits
the diatomite is found associated with bentonite clay and volcanic
ash.
A systematic exploration program
for diatomite was started in 1981 and
more than 15 deposits and occurrences were investigated. Six deposits
with
high quality and optimum reserve
were studied in detail.
| Deposits | Pitting | Sampling | Mapping |
| Adamitulu | 23 pits dug with pitting interval 100-200m | 40 samples collected and analysed technological tests carried out. | mapping at 1:2000 reserve were calculated |
| Chefe Jilla | 33 pits dug with pitting interval 100m | 53 samples were analysed, technological tests carried out | Mapping at a scale 1:2000 reserve calculation |
| Gedemotta | 98 pits dug with pitting interval 200-800m | 658 channel samples analysed, technological tests carried out | Mapping at a scale 1:2000 and 1:5000 reserve calculation |
As can be seen from the above
summary table detailed exploration of the
deposits has been done. In addition to these preliminary market
survey has
been carried out and technological tests have been conducted in
a
Czechoslovakian testing center and the products thus obtained
were proved
to be of applicable for the industry.
4. Project Documents available:
The detail geological exploration
information, the preliminary market study documents are available
in the
Ministry of Mines and Energy.
5. Contact Person
Ministry of Mines and Energy
Mineral Operations Department
PO. Box 486
Tel 61 45 73
Fax 61 45 74 or 61 51 30
Addis Ababa, Ethiopia
Bentonite
1. Project Title: Bentonite
Evaluation and Development Project
2. Location of the Project:
The deposit is located in different parts of the
country. The locations are Gewane, Mille and ounda Hadar in Afar
Regional National State, Lake Abaya, Gidicho island.
3. Summary of the Project:
The deposits are part of the thick sequence of
lacustrine and reverine clays, silts sands and calcareous grits,
gravel
conglomerates and halites interbedded with basalt and ash beds.
The
sediments were deposited near the western margin of the southern
part of
Afar Depression which throughout are late tertiary and quaternary.
A systematic geologic exploration
and mapping along a total of 50 parallel
profiles using air photos, 262 samples for chemical and physical
tests and 27
technological samples were collected and tested. As in the case
of diatomite
preliminary market survey has been carried out and technological
tests have
been conducted in a Czechoslovakian testing center and the products
thus
obtained were proved to be of applicable for the industry.
4. Project Documents Available:
Documents are available for the above said
tests and report on detail exploration works.
5. Contact Person
Ministry of Mines and Energy
Mineral Operations Department
PO. Box 486
Tel 61 45 73
Fax 61 45 74 or 61 51 30
Addis Ababa, Ethiopia
Coal and Oilshale
1. Project Title:- Delbi -
Moye Coal and Oilshale Project
2. Location of the Project:-
The Delbi- Moye area is located at about 50 km
south of Jimma town in Oromia National Regional state, which is
close to
the urban center and is accessible by four wheel drive.
3. Project Summary:- Geological
investigation for coal of economic potential
has been carried out on coal occurrences of Delbi - Moye, Mush
valley
(North Shoa), Chilga (Gondar), Nejo (Wollega), as well as in many
other
sites. Among the coal occurences some have shown economic importance,
of these the Delbi - Moye and Mush deposits are the most promising
deposits, while few others such as the Chilga and Nejo deposits
are
presumed to possess some economically exploitable portions.
Geological exploration work,
from reconnaissance through regional to detail
mapping and preliminary to detail prospecting have been undertaken
successively in the project area. The results of the study were
encouraging to
start subsurface study into two steps, preliminary and detail
prospecting
stages. The potential area, where economical coal and oilshale
resources
expected to occur were delimited using prospecting criteria and
a total of 18
bore holes were sunk.
4. Project document available:
Relevant documents are available at the
Ministry of Mines and Energy.
5. Contact Person:
Ethiopian Geological Surveys
P.O. Box 2302
Tel 15 91 72
Addis Ababa, Ethiopia
Platinum
1. Project Title: Yubdo Platinum
evaluation and development
2. Location: Yubdo Platinum
deposit is located in the Oromia region at 520
kilometers distance from the country's main capital, Addis Ababa.
About
60% asphalted road and the rest gravel road makes it accessible
at all
seasons of the year.
3. Project Summary: Platinum
metal has been mined in Yubdo since ancient
times. It was believed by some authors that platinum from Yubdo
may
have been a jewellery source for Egyptian Pharoanic kings. Despite
this,
the first documented evidence of platinum occurrence at Yubdo
was
reported by a Russian geologist, Kurmakove in 1925. E.W.Molly
(1934)
first described on the geology of the deposit.
The first systematic prospecting
work to assess the reserve of the deposit was
carried out by D.A..Jelence (1956 and 1966). During the same period
S.S.Augustithis (1965, 1967) made the study of the mineralogy,
geochemistry of the platiniferous dunite-birbirite-pyroxenite
complex of
Yubdo/Birbir and on the origin of "platinum nuggets"
in lateritic covers from
ultrabasic rocks. B.Megersa (1965) estimated the reserve of platinum
in
Yubdo based on some drilling works and mining data collections.
Rudis
organization of Yugoslavia (1965) dug 147 pits and came up with
platinum
grade ranging from 0.019 gm/m3
- 0.144 gm/m3
.
During periods between 1967-1972
a joint UN-Ethiopian mineral survey
team produced geologic map o the area at a scale of 1:30000. The
same team
also produced a map of total magnetic field, as well as maps showing
the
distribution of Cu, Ni, Zn, and As in the weathered soil.
Yubdo platinum deposit covers
an area of 30 sq.kms. The deposit along side
platinum contains platinum group metals and some gold and iron
in the
following proportios:- Platinum 77.6%, Osmium 1.7%, Iridium 0.6%,
Rhodium 0.7%, Palladium 0.3%, Gold 2.1% and Iron 15.2%.
Despite all differences in
reserve content, all sources indicate the presence of
economic grade platinum in the area.
4. Project documents available:
Relevant documents are available at the
Ministry of Mines and Energy.
5. Contact Person
Ministry of Mines and Energy
Mineral Operations Department
P.O.Box 486
Tel 61 45 73
Fax 61 45 74 or 61 51 30
Addis Ababa, Ethiopia
Phosphate
1. Project title: Bikilal
Igneous phosphate project
2. Location: Bikilal is located
in Oromia region, 464 kms. west of Addis
Abeba near Ghimbi. The target area is bounded by latitude 9 15'33''
and 9
20'36'' north, and longitudes 35o51'42''
and 35o54'49''
east. The deposit
could be reached by an all weather road from Addis Abeba to Ghimbi
and
a feeder road whichmay need regular repair from Ghimbi to Bikilal.
3. Project Summary: The Bikilal
layered gabbro as a whole extends from
Bikilal to as far as south of Ghimbi for about 30 kms. distance.
The
mineralized section which has been studied to date is in the elliptical
part
("head") of the intrusive. The ore zone has 0.7-1.2
km width and about 10
km lingth. There are also scattered exposures of apatitie bearing
rocks
throughout the extent of the intrusive.
The mineralization is represented
by massive magnetite-ilmenite ore,
disseminated magnetite-ilmenite ore, and disseminated apatite-magnetite-
ilmenite ore. The iron ore, i.e. magnetite-ilmenite bodies, has
average grade
of 41.0% Fe, 0.36% P2
O5,
0.77% S, 16.72% TiO2
and 0.24% V2
O5.
Total
reserves (C1+C2)
of iron ore are at 57.8million tons.
The phosphate resource which
is composed of apatite, ilmenite and
magnetite has the following compositions and resources: 3.59%
P2
O5,
6.04% TiO2
, 0.09%V2
O5
and 21.87% total iron. Reserves of the phosphate
resource is placed at 127 million tons of ore at inferred category.
4. Project documents available:
Relevant documents are available at the
Ministry of Mines and Energy.
5. Contact Person
Ministry of Mines and Energy
Mineral Operations Department
P.O.Box 486
Tel 61 45 73
Fax 61 45 74 or 61 51 30
Addis Ababa, Ethiopia