11 August 2015 Economic News Briefs

Circum Minerals completes Definitive Feasibility Study on Danakil project

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Circum Minerals Limited, a 2% owned subsidiary of Premier African Minerals Limited, released details of its recently completed Definitive Feasibility Study on its potash project in the Danakil Basin in Ethiopia.

Circum Minerals’ Danakil project has measured, Indicated and Inferred Resources of 4.9 billion tonnes at 18.1% potassium chloride. It has Proven and Probable Reserves of 107.8 million tonnes of potassium chloride equivalent and an estimated annual production of 2 million tonnes of muriate of potash and 750 000 tonnes of sulfate of potash for the first phase.
The Reserves should be sufficient to support a 26 year mine life for Phase 1 with a ramp-up period of three years. The project has a development capital for phase 1 of $2.58 billion which includes a contingency budget.
The project recorded the lowest quartile mine gate cash cost of $39 per tonne of muriate of potash and $114 per tonne of sulfate of potash, while it ran a total operating cost of $83.89 per tonne of muriate of potash and $158.95 per tonne of sulfate of potash. Circum Minerals’ Danakil project showed an after-tax Net Present Value of $2.1 billion, at a 10% discount rate. The after-tax internal rate of return was at 22.4%.
Circum Minerals is a potash exploration and development company, currently focused on its 100% owned Danakil potash project in Ethiopia.
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Essel targets potash licence in Eritrea

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11th August 2015
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JOHANNESBURG – Essel Group India subsidiary Essel Group Middle East (EGME) has continued its expansion into the African mining sector through the acquisition of Canadian company NGEx Resources’ Bada potash exploration licence, in Eritrea.
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The company aimed to start the first phase of drilling at the little-explored 736 km2 mining area located in the Danakil Depression, about 150 km south-east of Eritrea’s capital city, Asmara, in October.
“We plan on boring approximately five trenches in the initial phase, [and] we have set our targets to be achieved by mid-2016,” said EGME MD Gagan Goel in a statement on Tuesday. The drilling programme aimed to unpack the evaporite sequence and test the shallower portions of the basin for potash mineralisation. While limited historical exploration work had been done in the licence area to date, EGME’s “initial reconnaissance” found extensive shallow alluvium cover, young volcanic rocks or recent marine evaporites, with potential for potash-bearing rocks under much of the licence area.
“The Bada licence area offers several significant advantages; along with being a rich source of the mineral itself, its proximity to mass transit points is favourable as well,” Goel added.
The entry into Eritrea followed the company’s potential investment into the oil and exploration sector through a 60% earn-in of TSX-listed Simba Energy’s existing production sharing contracts in Kenya, Chad and Guinea in June. http://www.miningweekly.com/article/essel-targets-potash-licence-in-eritrea-2015-08-11
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Turbines at Gibe III to begin trial production of electric power

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Turbines at Gibe III to begin trail production of electric powerAddis Ababa, August 11, 2015  – Turbines installed at Gibe III hydropower plant will begin receiving water as of today, thereby enabling the plant to begin trail production of electric power.

Water, Irrigation and Energy Minister, Alemayehu Tegenu, told FBC yesterday that the hydropower dam, which is in the verge of completion, stored water that enable it to commence trail production.

Installation of turbines for the 1,870 megawatt power plant is underway. The plant will have 10 turbines that generate 187-megawatt each.

According to Alemayehu, three of the turbines are currently readied for power generation. The fourth turbine is also nearing completion.

If the trail is successful, the power plant will start generating 500-megawatt electricity this month; if not next September, he said

If sufficient water is available until the coming December, all turbines will begin power generation, he said

Gibe III will be the largest of all the hydropower plant that went operational in the country so far.

Launched five years ago at a cost of 1.8 billion US dollars, Gibe III hydropower dam is now more than 98 % complete, it was noted.

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Ethiopia clears Indian firm to mine marble

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An Indian company has been cleared to mine marble in Ethiopia’s regional state of Benishangual-Gumuz, APA can report Monday.Samaka Stones Private Limited Company has reportedly allocated close to $2.9 million to commence the production of 131,600 cubic meters of marble annually. Ethiopia’s State Minister of Mines Dr. Alemu Sime and Samaka Stones PLC General Manager, Moju Sambeswar Monday signed the agreement in the capital, Addis Ababa. The agreement concluded would give Samaka Stones an exclusive right to carry out large-scale mining within the license area for the coming 20 years. “We believe the marble production by Samaka Stones PLC would contribute to the ever growing demand of marble by the booming construction industry apart from earning of foreign currency, knowledge and technology transfer,â€� Dr. Alemu said He further pointed out that the government is committed to providing the necessary support and creating conducive environment for investors who want to engage in the sector. Samaka Stones PLC General Manager, Moju Sambeswar said his company will perform to fulfill the demand triggered by the huge infrastructural work in the country. http://en.starafrica.com/sport/ethiopia-clears-indian-firm-to-mine-marble.html

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The Economist’s Summit hopes to showcase Ethiopia’s potential

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By Eskedar Kifle   
Monday, 10 August 2015
Ethiopia’s GDP per capita is expected to grow by 37 percent between 2015 and 2019, according to the Economist Intelligence Unit. This was stated during a press conference held on Thursday, August 6, 2015 at the Sheraton Hotel to announce the Economist’s Ethiopia Summit, which is scheduled to be held from October 28 to 29. The summit is expected to have an attendance of over 250 participants and is set to be officially opened by Prime Minister Hailemariam Dessalegn. “This is a very exciting time for Africa. We talk a lot in The Economist, Europe and the Americas about the next billion consumers and how much influence and potential there is going to be in Africa. Ethiopia, with its huge population and consumer market represent 10 percent of that, so this country is obviously going to play a very important role in Africa’s growth. The positivity we have felt in this city especially, on the economics and business side things, is really going to be captured at the summit we will be holding here in October,” said Michael Oakes, Head of Programs at The Economist Events. Oakes further stated that the upcoming event features many high-level officials who will be discussing the Ethiopian economy and the massive opportunities it presents. “From our Economic Intelligence Unit, when you look at East Africa, foreign direct investment flows increased to USD 6.8 billion in 2014, of which USD 1.2 billion went into Ethiopia, which reflects the huge interest in this country, and we feel that that number should and will be higher,” he said. According to the Economist Intelligence Unit, Ethiopia’s GDP is forecasted to grow on average by 7 percent annually in the periods between 2015 to 2019. “We think the figure could and should be much higher, but actually 7 percent is pretty good, especially compared to Europe. A lot of this growth is from the agricultural sector, which is expected to grow by 7.7 percent in the forecasted period,” Oakes said. Among the several points of discussion at the summit will be the challenges in the Ethiopian banking sector, which is currently closed for foreign investment. The energy sector will also be given attention through several discussions with panelists including Brian Herlihy, CEO and Founder of Black Rhino, as well as Tewodros Ashenafi, founder and CEO of Southwest Energy. http://www.capitalethiopia.com/index.php?option=com_content&view=article&id=5351:the-economists-summit-hopes-to-showcase-ethiopias-potential-&catid=35:capital&Itemid=27

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Energy talks to be held in Ethiopia in October

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Energy talks to be held in Ethiopia in OctoberAddis Ababa, August 10, 2015  – A meeting on energy and power investment is set to be held in Addis Ababa from 26 to 29 October 2015, aiming at finding ways for increased energy investment in Africa to unlock its energy potentials as well as review evolving climate policies and emerging resilience challenges.

The meeting which is expected to bring energy ministers and investors engaged in energy and power investment is organized by the World Energy Council Executive Assembly. The meeting will also deliberate on how to create key enabling conditions for both policy makers and investors to work in tandem in areas ranging from tackling hurdles in reversing investment inflow to Africa to developing its energy potentials in hydropower, solar and natural gas. Christoph Frei, Secretary General of World Energy Council said, “With a resilient energy infrastructure, cross border co-operation and investment, there are energy resources which could be exploited to the benefit of African prosperity.” Christoph Frei also went on to note that “there are enormous energy resources in sub-Saharan Africa, 30 percent of the world’s energy commodities can be found here,” stressing that “regional integration, market creation and development of long value chains will be essential to maximize their potential for the region where regional co-operation is a key factor.” Christoph Frei referring to World Energy Council Scenarios Report further said an estimated   “investment of between USD 1.2 trillion and USD 1.4 trillion is needed to meet the energy demands of the region by 2050.” http://www.fanabc.com/english/index.php/component/k2/item/3621?Itemid=674

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Ethiopia wants to raise mining profile

Ethiopia wants to raise mining profileAddis Ababa, August 10, 2015  – The government wants to showcase the opportunities available in mining by hosting an international conference next month in Addis Ababa.

This also comes when KEFI Minerals (KEFI), the gold exploration and development company with projects in Saudi Arabia and Ethiopia, announced final bidding has opened for the contracts for construction of the process plant and operation of its Tulu Kapi gold mine. Tulu Kapi Gold Mine is situated 28 kilometres east of Ayra-Gulliso town in the state of Oromia, Ethiopia. The mine is now owned by KEFI Minerals, who bought 100% of the license held earlier by UK-based gold exploration and development company Nyota Minerals (Ethiopia) by 2014. The property lies in the Tulu Kapi-Ankore license area and has a surface area of 8.44 square kilometres. Harry Anagnostaras-Adams, executive chairman of KEFI Minerals, said last week, “We are pleased to be reaching another milestone in the development of Tulu Kapi, our key asset, and are delighted with the high calibre of the bidders. “Progress on the project remains on schedule for optimization of development funding this quarter, commencement of works next quarter and production in early 2017.” Last October, Tolosa Shagi the minister in overseeing the mining sector said during the past four years, Ethiopia had earned more than $2.3 billion from exports of gold, tantalum, opal, marble and other minerals. “Ethiopia is endowed with a favorable geological environment that hosts a wide range of mineral and geo-energy potential,” he said during the launch of a World Bank report that backed this view. The Ethiopia International Mining Conference 2015 (EIMC 2015) is scheduled to take place at the United Nations Conference Centre between September 23 and 24. It is being organized by AME Trade Limited United Kingdom in association with the Ministry of Mines of Ethiopia. The event will feature a two-day conference and an associated trade exhibition. EIMC 2015 will showcase and explore developments in Ethiopia’s thriving mining sector and focus attention on potential opportunities, lessons learned by key investors and the creation of new business partnerships. The event will offer a unique opportunity for senior representatives from the global mining industry, development partners and other stakeholders to network, share experiences and discuss best practices through case studies while addressing opportunities, challenges and other pertinent issues. In addition, the forum will feature a deal-driven exhibition allowing companies to market products and services directly to a qualified target audience. With forecasted GDP growth of 7.2% for 2015, Ethiopia remains one of Africa’s top performing economies. EIMC 2015 provides the optimal platform to promote and unlock Ethiopia’s mineral potential. The main theme of the conference is: ‘Utilising Ethiopia’s Natural Resources as the Engine for Sustainable Development’. According to the organisers, topics to be discussed include  investment issues surrounding Ethiopia’s developing mining sector; artisanal and small-scale mining; ensuring mutually beneficial partnerships; update on exploration projects; infrastructure development to support the mines going into operation. Other issues are electrification and consolidating power provision to the mines. http://www.fanabc.com/english/index.php/component/k2/item/3617?Itemid=674

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Edible oil processing factories increasing

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Edible oil processing factories increasingAddis Ababa, August 9, 2015 – The number of factories engaged in processing edible oil has been increasing from time to time so as to benefit from the huge local market, the Food, Beverage and Pharmaceuticals Industry Development Institute said.

Three factories with a combined capital of seven billion Birr have joined the industry in the concluded fiscal year alone. The government has been encouraging local and foreign investors to engage in edible oil processing so as to meet the ever-increasing demand, estimated to exceed nine million liters per annum. Edible oil products by four processing factories, namely Belayeneh Kinde, Addis Mojjo, Hamaresa and Bahir Dar enable the nation meet 20 percent of the demand, Spice Processing Industry Development Acting Director Tamrat Tesema told ENA. The government has been forced to meet 80 percent of the total demand by importing products. http://www.fanabc.com/english/index.php/component/k2/item/3609?Itemid=674

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Dutch, Indian Companies Engage in Floricultural Development

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Dutch, Indian Companies Engage in Floricultural Dev'tAddis Ababa, August 8, 2015 –  Three foreign floricultural companies have become operational during the past six months, according to Ethiopian Horticultural Development Agency.

The agency said two of those are Indian companies and the third a Dutch company. Agency Public Relations Coordination Head, Mekonnen Hailu said the companies have started work on 190 hectares of land in the Amhara Regional State. The engagement of the companies in horticultural development would help increase the foreign currency earning of the country by supplying flower for the export market in quality and quantity. According to him, the Bahirdar Airport Cargo is also supporting investment by building refrigerated warehouses and other facilities. Due to the attention the government has been giving to the sector, many foreign companies have expressed their desire to engage in floricultural development, he added. Foreign companies would also create jobs and contribute to technological transfer. Ethiopia has earned 226 million USD from floriculture and horticulture last Ethiopian fiscal year. Of this, 184 million USD was secured from the floriculture sector, it was indicated. Ethiopia is among the leading countries with huge potential for floricultural and horticultural development. http://www.fanabc.com/english/index.php/component/k2/item/3607?Itemid=674

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