16 May 2014 Development News Briefs



Ethiopia earns over 1.5 billion US Dollars from tourism during past nine months



The revenue earned by Ethiopia’s tourism sector has increased greatly. Ethiopia has registered more than 1.5 billion US Dollars in earnings from tourism during the past nine months, according to the Ministry of Culture and Tourism.

The stated amount was obtained from the 509,000 foreign tourists who visited Ethiopia during the reported period, said Culture and Tourism Minister Amin Abdulkader when he addressed a work performance evaluation forum in Addis Ababa on Wednesday.

He noted that the government had given due attention to the development of the tourism sector and this had resulted in a continuous growth in the number of tourists visiting the country.

State Minister for Culture and Tourism Tadelech Dalecho said Ethiopia had become one of the top 10 countries visited in the world because of the peace and stability prevalent in the country.

The income earned from the tourism sector had been growing by 12 per cent annually, following the construction of airports in various regions, she added.

The performance during the report period had exceeded that of same period last year and efforts are being exerted to earn more during the remaining months of the current fiscal year, she said.



Sudanese minister calls for strengthening of economic ties with Ethiopia


Sudan’s Minister of Investment, Dr. Mustafa Osman Ismail, said at the meeting of the Sudan-Ethiopia Forum in Khartoum at the weekend that the environment was now conducive for establishing good economic relations between Sudan and Ethiopia.

He called for increased integration in relations between the two countries, noting that Ethiopia possessed water sources and Sudan had vast and fertile land.

He suggested that the policy of the state required the private sector to take over 70 per cent of economic activity and that if civil society organizations were activated they could undertake a greater role than official bodies.

He noted that there were over 700 Sudanese investment projects in Ethiopia and called for the removal of all obstacles that might hinder the expansion of trade between Sudan and Ethiopia.

The Commercial Attaché of the Ethiopian Embassy said the Sudan was on top of Ethiopia’s priorities in terms of economic relations and noted that more than 50 trade agreements had been signed between the two countries since 2000. (MoFA)



President Hadi confirms depth of Yemeni-Ethiopian relations


Yemeni President Abdu Rabbu Mansour Hadi confirmed on Thursday the depth of Yemeni-Ethiopian relations, praising the role of Ethiopia and its position in the region and in the African Continent.

This came during President’s meeting with Ethiopian Foreign Affairs Minister, Dr Tedros Adhanom, who is currently visiting Yemen to take part in the 5th meeting of the Yemeni-Ethiopian joint ministerial committee.

Hadi stressed the importance of enhancing the cooperation relations between the two friendly countries, in particular in the economic and trade fields, emphasizing in this regard the need for activating cooperation and trade exchange between the two countries’ commercial champers.

For his part, Ethiopian Foreign Affairs Minister briefed Hadi on his meetings with Foreign Minister Abu Bakr al-Qirbi along with other relevant institutions, which resulted in signing on nine agreements in various areas.

He noted that there is five other agreements would be signed on the upcoming meeting of Yemeni-Ethiopian joint ministerial committee.

Dr Tedros renewed the President Mulatu Teshome of Ethiopia’s invitation to President Hadi to visit Ethiopia, which he said would open a new horizon between the two friendly countries at different levels.

Early on Thursday, Yemen and Ethiopia signed on a number of agreements and protocols of bilateral cooperation in trade, investment, higher education and standards and specifications.

The agreements and protocols co-signed by Foreign Minister Abu Bakr al-Qirbi and his Ethiopian counterpart Dr Tedros Adhanom at the concluding of the 5th meeting of the Yemeni-Ethiopian joint ministerial committee. (Saba)



Weather-based insurance for African farmers has issues


Flickr/ Pablo Tosco, Oxfam International


Just how well weather index-based insurance will work for smallholder agriculture in Africa is still highly debatable.

This is about investing in insurance to help farmers manage, mostly, drought risks in Africa where agriculture is a prime source of food and earnings for millions of smallholders, but is increasingly facing multiple challenges.

The insurance is meant to cushion farmers against the vagaries of weather; prolonged droughts and in some cases flooding. And climate change-related impacts are complicating matters for the needy seeking to eke a living out of scratching the earth bare and sprinkling seeds and water, sometimes hoping against hope.

At the Building Resilience for Food and Nutrition Security conference organised by the US-headquartered International Food Research Institute (IFPRI) in Addis Ababa, Ethiopia, this week (15-17 May), I have gathered that weather index-based insurance faces myriad challenges.

According to Ruth Hill, senior economist, Africa Region Poverty Reduction and Economic Management Network at the World Bank, it has two contrasting positions.

On one hand, it can manage agricultural risk in rain-fed production systems that require a financial product to pay many farmers at once for weather-related failures.
“Weather index insurance is a unique financial product that provides the only realistic solution to managing risk for rural households,” Hill says.

But on the other hand it is a hedging product and as such the basic risk is too high for it to offer much value to farmers.

Not just these two positions: There are too many pilot projects, but few are being implemented on a large scale, according to Guush Berhane, associate research fellow at IFPRI, Ethiopia. The product design is complex and the actuarial or insurance skills needed are missing.

It suffers from the lack of required extensive data that is still unavailable in most parts of the continent

Berhane adds that its implementation by stakeholders is often weak, and lacks infrastructure such as meteorological equipment for weather monitoring.

Next to that, Berhane says, is the challenge of transferring risk internationally — linking to re-insurance can be a nightmare.

More still needs to be done to shape weather index-based insurance into a more workable and viable fall-back outfit for smallholders across Africa.

This article has been produced by SciDev.Net’s Sub-Saharan Africa desk.


GTP, Green Strategy Helping to Improve Agricultural Production, Ensure Food Security: Premier

GTP, Green Strategy Helping to Improve Agricultural Production, Ensure Food Security: Premier

Addis Ababa May 16/2014   Prime Minister Hailemariam Desalegn said the implantation of the growth and transformation plan, and the green strategy as well as building resilient agricultural system helped Ethiopia improve agricultural production and ensure food security.

While addressing the 6th building resilience for food and nutrition security conference here yesterday, the Premier said Ethiopia has been taking various policy measures and investments to anticipate, adopt and recover from shocks.

According to Hailemariam, Ethiopia have approached the challenge in anticipating, adopting and recovering from shocks such as droughts through several ways.

The Premier said the government has recognized that unrelated policy decisions and shocks could cause disaster to the global and local food systems.

Considering this, the country has started to implement the five-year growth and transformation plan in 2010 to build resilient economy. The plan consists of investments and policy approaches for enhancing agricultural productivity, expanding key infrastructures and promoting industrial growth.

This exemplifies the government’s key strategy in enhancing resilience to shocks of many forms, which is to build a ‘robust and diversified’ economy, he remarked.

Another move the government has taken to build resilient economy was the adoption of the green economy strategy in 2011, Hailemariam explained. Rehabilitation of degraded land, afforestation and reforestation, and increasing crop and livestock productivity, are the major elements of the strategy.

The government has invested in raising productivity of small-holder farmers, strengthening agricultural marketing systems and increasing area of land developed through irrigation, among others.

The country has put in place a successful social protection scheme, safety net program, to help poor farmers ensure their food security. Apart from ensuring food security of poor households, the program supports the creation of assets such as roads and irrigation schemes which enhance resilience of communities.

These and other investments and policy efforts have helped ‘to raise economic growth, improve food and nutrition security, reduce poverty and, we believe, make us more resilient country, better able to cope with shocks as they arise.’, Hilemariam added.

Ethiopia is the fastest growing non-oil economy in Africa with growth of about 10 percent, and the second largest floriculture supplier in Africa, said Kanyo Nwazne, President of International Fund for Agricultural Development (IFAD).

Because of the strong leadership and policies to address macroeconomic issues and increased investment in drought preparedness and small holder farmers, the impact of the 2011 Horn of Africa drought on Ethiopia was very limited, he added.

The country’s determinedness in allocating 15 percent of its annual budget for the agriculture sector is one of the highest in Africa.

The World Food Program has decided to change its way of supporting poor countries, which was only providing with emergency aids during shocks, the Executive Director, Ertharin Cousin told reporters.

WFP has recognized that his traditional way of assistance is not helping poor countries ensure food production, she added.

Soon WFP will anew its system and work in collaboration with the countries to support their efforts and bring change in this regard, the Director said.

The three-day conference brings 800 participants from 75 countries across the world to deliberate on investment in resilience for food and nutrition security.


Ethiopia’s ‘Super Grain’ Teff Finds Its Way To European Supermarkets

By Kevin MwanzaEthiopia, one of the world’s poorest countries, is also the native home of teff, a highly nutritious ancient grain increasingly finding its way into health-food shops and supermarkets in Europe, CCTV reported. Teff’s tiny seeds are high in calcium, iron and protein, and boast an impressive set of amino acids.

Naturally gluten-free, the grain can substitute for wheat flour in anything from bread and pasta to waffles and pizza bases. Like quinoa, the Andean grain, teff’s superb nutritional profile offers the promise of new and lucrative markets in the west.

Tedd is grown by an estimated 6.3 million farmers in Ethiopia, with fields of the crop covering more than 20 percent of all land under cultivation. But growing appetite for traditional crops and booming health-food and gluten-free markets are breathing new life into the grain, increasingly touted as Ethiopia’s “second gift to the world”, after coffee.

Source (with video) here   http://sodere.com/profiles/blogs/ethiopia-s-super-grain-teff-finds-its-way-to-european-supermarket




May 14, 2014 (AOI–TSX, AOI–NASDAQ OMX First North) … Africa Oil Corp. (“Africa Oil” or the “Company”) is pleased to provide first quarter 2014 financial results and an update on its operations in Kenya and Ethiopia.

The Company currently has six rigs operating in Kenya and Ethiopia which are focused on three main activities; 1) Drilling new basin opening wells; 2) Drilling new prospects in the discovered basin in Northern Kenya; and 3) appraising and testing existing discoveries.

Two basin opening wells are currently drilling with results expected in the second quarter of 2014. The Sala prospect, on Block 9, is being drilled in the Cretaceous Anza graben and will test a large anticlinal feature along the northern basin bounding fault. This well is operated by Africa Oil which holds a 50% interest and operatorship with partner Marathon Kenya Limited B.V. holding the remaining 50%.

The other new basin opening well is the Shimela well being drilled in the Chew Bahir basin on the South Omo block in Ethiopia.  This basin is located along the Tertiary rift trend and has many similarities to the recent discoveries in Kenya. The rig will move to the Gardim prospect following the completion of Shimela which is a basin bounded fault prospect located in the southern portion of this basin. The Company holds a 30% working interest in this block along with operator Tullow Oil plc (“Tullow”) (50%) and partner Marathon Ethiopia Limited B.V. (20%).

Plans are also underway to drill prospects in three additional new basins this year.  The Dyepa-1 well will spud in the second quarter and will target the South Kerio basin which is proximal and geologically similar to the discovered basin in Northern Kenya in Block 10BB.  This well is designed to test a basin bounding fault prospect on the western flank of the basin similar to the string of pearls field discoveries such as the initial Ngamia discovery.  A number of additional prospects have been identified in this basin which would be de-risked if Dyepa is a discovery. This rig will then move to test the Aze prospect which is located in the North Kerio basin and is comprised of a large, four-way dip closed anticline on the southern shore of Lake Turkana.

The last basin to be targeted this year is the West Turkana basin in Block 10BA in Kenya and the first well in this program is expected to spud later this year. The first prospect to be drilled will be the Engomo (formerly Kiboko) prospect on the western shore of Lake Turkana. It is also a basin bounding fault prospect and has similar potential to prove a petroleum system that would lead to accelerated drilling on a number of identified prospects. In both of these basins, as in the discovered basin in Northern Kenya, the Company holds a 50% working interest along with Operator Tullow Oil plc (50%).

The only well which is currently being drilled on a new prospect in the discovered basin in Northern Kenya is the Ekunyuk-1 well which is located on the eastern flank play, on trend with recent discoveries at Etuko and Ewoi. The well has now reached a final total depth of 1,802 meters and has encountered some 5 meters of net oil pay, within approximately 150 meters of reservoir quality water-bearing sandstone and an equal thickness of a basin-wide rich oil shale. This rig will now be moved to the Agete-2 location.

Three additional rigs are currently pursuing appraisal and testing activities on the existing discoveries.  The Sakson PR5 rig is continuing drilling operations on the Twiga-2 up-dip appraisal well. The initial wellbore was drilled near the basin bounding fault and encountered some 18 meters of net oil pay within alluvial fan facies, with limited reservoir quality. A decision was made to sidetrack the well away from the fault to explore north of Twiga-1 and some 62 meters of vertical net oil pay has been discovered in the Auwerwer formation, similar in quality to the initial Twiga-1 discovery. The well is currently being deepened to evaluate the Lower Lokhone sand reservoirs and a testing program for this successful well is planned to be conducted later this year. This rig will then move to drill a down-dip appraisal of the Amosing discovery, which appears to have high quality reservoir and may be one of the largest discoveries in the basin to date.

The PR Marriott 46 rig is currently drilling ahead on the Ngamia-2 appraisal well which is expected to be completed by the end of the second quarter.  This rig will then drill the Ngamia-3 appraisal well.

Testing operations are ongoing on the Agete-1 well using the SMP-5 rig and expected to be completed by the end of May. The plan is for this rig to continue testing operations on discovery and appraisal wells in the discovered basin in Northern Kenya.

Additionally in Ethiopia, the Company has recently completed the drilling of the El Kuran-3 appraisal well on Block 8.  El Kuran-3 was an appraisal of a discovery made by Tenneco in the 1970’s, and encountered a significant but tight gas-condensate zone in Jurassic Hammanlei carbonates. The well has been suspended pending a decision on conducting a fracture stimulation, which will be required to assess the long-term productivity of the formation.  Discussions are ongoing with the Government of Ethiopia to secure an extension to the Exploration Period under the PSC to assess the economic viability of the discovery.

Africa Oil CEO Keith Hill stated “We are looking forward to the results of the new basin opening wells which have the potential to unlock significant value in terms of new prospects and resources. The ongoing drilling in the discovered basin in Northern Kenya has been quite helpful in understanding the distribution of the best reservoir facies and will no doubt be enhanced by the ongoing 3D seismic survey.  We remain very bullish in not only the existing discoveries but in the remaining prospects in the discovered basin in Northern Kenya such as Etom, the largest remaining prospect along the Western ‘String of Pearls’ trend, which will be drilled in the third quarter of this year. Our goal is to open up at least one new basin and to move a significant number of barrels from prospective to contingent resources by the end of 2014 as we move the field development program forward.”

The Company is also actively pursuing development studies in the Block 10BB/13T area including commencement of the pre-front end engineering design (pre-FEED) and environmental and social impact assessment (ESIA) studies for the pipeline, export terminal and field facilities. It is the goal the Government of Kenya and the joint venture partnership to achieve project sanction, including the approval of an export pipeline, by the end of 2015/early 2016.

As was previously announced, the company has now graduated to the main board of the TSX and plans to apply for graduation to the NASDAQ OMX Stockholm main board.


Further Significant Events During The First Quarter of 2014:

  • Africa Oil ended the quarter with cash of $434.3 million and working capital of $360.1 million.
  • In January, the Company announced a new oil discovery at Amosing-1 located seven kilometers southwest of the Ngamia-1 discovery along the Basin Bounding Fault Play in Block 10BB.  Logs indicated 160 to 200 meters of potential net oil pay in good quality sandstone reservoirs.
  • In January, the Company announced a new oil discovery at Ewoi-1 located four kilometers to the east of the Etuko-1 discovery in the Basin Flank Play on the eastern side of the discovered basin in Northern Kenya in Block 10BB.  Logs indicated potential net pay of 20 to 80 meters to be confirmed by well testing.
  • In February, the Company announced the results of five well tests conducted on five Lokhone pay intervals at Etuko-1 located on the Basin Flank Play in Block 10BB.  Light 36 degree API waxy crude oil was successfully flowed from three zones at a combined average rate of over 550 barrels of oil equivalent per day.  In March, the Company announced the results of the Etuko-2 exploration well drilled to test the upper Auwerwer sands overlying the previously announced Etuko discovery.  Etuko-2 penetrated a potential significant oil column identified from formation pressure data and oil shows while drilling and in core, with good quality reservoir but flowed only water on drill stem test.  The results are considered inconclusive and analysis is underway to consider further options to evaluate this reservoir.
  • In March, the Company announced the results of a well test on the Ekales-1 discovery drilled in 2013 and located on the Basin Bounding Fault Play between the Ngamia-1 and Twiga South-1 discoveries.  Testing operations on the Ekales-1 well confirmed this significant oil discovery.  Two drill stem tests were completed and flowed at a combined rate of over 1,000 bopd from a combined 41 meter net pay interval.  The upper zone had a very high productivity index of 4.3 stb/d/psi.
  • In March, the Company announced the results of the Emong-1 well located four kilometers northwest of Ngamia-1 field discovery in Block 13T (Kenya).  The well encountered oil and gas shows while drilling, however the Auwerwer sandstones that are the primary reservoirs in the Ngamia field were thin and poorly developed in Emong-1 and the well was plugged and abandoned.  It is believed that the reservoir was poorly developed due to its proximity to the basin bounding fault and its location within what appears to be a local isolated slumped fault margin.  This well, which was trying to establish an additional play, has no impact on the potential of the Ngamia oil accumulation or any other prospectivity in the discovered basin in Northern Kenya.
  • In Blocks 10BB and 13T, the acquisition of a 550 square kilometer 3D seismic program over the discoveries and prospects along the Basin Bounding Fault Play in the discovered basin in Northern Kenya is ongoing and is scheduled to complete at the end of the third quarter.
  • In March, the Company completed a farmout transaction with Marathon whereby Marathon acquired a 50% interest in the Rift Basin Area leaving the Company with a 50% working interest. In accordance with the farmout agreement, Marathon was obligated to pay the Company $3.0 million in consideration of past exploration expenditures, and has agreed to fund the Company’s working interest share of future joint venture expenditures to a maximum of $15.0 million with an effective date of June 30, 2012. Upon closing of the farmout, Marathon paid the Company $3.0 million in consideration of past exploration expenditures. Subsequent to the quarter end, Marathon paid the Company $10.2 million being Marathon’s and the Company’s share of exploration expenditures from the effective date to the closing date of the farmout.
  • In March, the Company completed a farmout transaction with New Age whereby New Age acquired an additional 40% interest in the Company’s Adigala Block leaving AOC with 10% working interest. In accordance with the farmout agreement, New Age is obligated to fund the Company’s 10% working interest share of expenditures related to the acquisition of a planned 1,000 kilometer 2D seismic program to a maximum expenditure of $10.0 million on a gross basis, following which the Company would be responsible for its working interest share of expenditures.
  • The Company has a significant exploration and appraisal program set out for 2014 which will see over 20 wells completed.  The program is focused on drilling out the remaining prospect inventory in the discovered basin in Northern Kenya, appraising existing and future discoveries with the aid of the new 3D Seismic survey, drilling six new basin opening wells and progressing development studies towards project sanction in the discovered basin in Northern Kenya.  This significant program in 2014 is fully funded.

For complete report see attached file.

Africa Oil’s Certified Advisor on NASDAQ OMX First North is Pareto Securities AB.

For further information, please contact: Sophia Shane, Corporate Development (604) 689-7842.



Ethiopia: First Overseas ‘China-Standard’ Electric Railway Laid


Beijing — The first overseas electric railway built to Chinese standards started having its tracks laid on Thursday in Dire Dawa, an eastern city of Ethiopia, China’s railway authorities said.

The railway, which will stretch 740 kilometers linking Ethiopian capital Addis Ababa with Djibouti’s capital Djibouti, is expected to be completed by the end of 2015, with a total investment of 4 billion U.S. dollars.

An inland country, Ethiopia depends on imports and exports on the port of Djibouti. It takes around one week for cargo to be transported between Djibouti and Addis Ababa by road.

“The railway, once in operation, will reduce the traveling time to seven or eight hours,” said the Ethiopia Railway Corporation, adding that the railway will also cut transportation costs.

The train will run at a speed of 120 kilometers per hour, the fastest ever in Ethiopian railway history.

“The track-laying marks an important construction stage of the Ethiopia-Djibouti railway,” said Yuan Li, general manager of China Civil Engineering Construction Corporation, one of the two major constructors.

Yuan said the railway will follow Chinese standards as tracks, trains and signal systems are all made-in-China. The whole process ranging from design, construction to supervision will be run by Chinese companies.

The construction is the second transnational railway to be built by Chinese enterprises after the landmark Tanzania-Zambia construction in the 1970s.  – Xinhua



Ethiopia life expectancy increased by 19 years, second top achiever in the world


Life expectancy in the globe’s poorest countries has risen by an average of nine years over the past two decades, thanks to major improvements in infant health, the United Nations said Thursday.



In its annual statistics, the UN’s World Health Organization (WHO) said that six of the countries had even managed to raise life expectancy to over 10 years between 1990 and 2012.

The top achiever was Liberia, where average lifespans increased by a full 20 years, from 42 to 62.

Next in line were Ethiopia (from 45 to 64 years), Maldives (58 to 77), Cambodia (54 to 72), East Timor (50 to 66) and Rwanda (48 to 65).

“An important reason why global life expectancy has improved so much is that fewer children are dying before their fifth birthday,” WHO chief Margaret Chan said in a statement.

Globally, average life expectancy rose by six years during the same period.

Based on global averages, a girl who was born in 2012 can expect to live to around 73 years, and a boy to the age of 68, the WHO said.

“But there is still a major rich-poor divide: people in high-income countries continue to have a much better chance of living longer than people in low-income countries,” Chan said.

A boy born in 2012 in a high-income country can expect to live to the age of around 76 ?- 16 years longer than a boy born in a low-income country.

For girls, the difference is even wider, with those in high-income countries likely to live to the age of 82 and those in poor nations to 63.

Female life expectancy in all the top 10 countries of the globe is 84 years or more, the WHO said.

Women in Japan enjoy the world’s best life expectancy, at 87 years, followed by Spain, Switzerland and Singapore on 85.1 years each.

Life expectancy among men, meanwhile, is 80 years or more in nine countries, with the longest in Iceland (80.2), Switzerland (80.7) and Australia (80.5).

“In high-income countries, much of the gain in life expectancy is due to success in tackling non-communicable diseases,” said Ties Boerma, head of the WHO statistics division.

“Fewer men and women are dying before they get to their 60th birthday from heart disease and stroke. Richer countries have become better at monitoring and managing high blood pressure for example,” he added.

Declining tobacco use is also a key factor in helping people live longer in several countries, the WHO said.

At the other end of the scale, life expectancy for both men and women is still less than 55 in nine sub-Saharan African countries: Angola, Central African Republic, Chad, Democratic Republic of Congo, Ivory Coast, Lesotho, Mozambique, Nigeria and Sierra Leone.





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