Ethiopia revokes over 50 mining licences

A woman washes mine dust in search of gold: Ethiopian law requires a company to commence exploration or mining within 90 days of signing a contract with government. FILE PHOTO | DAVID MUCHUI | NMG 

By ANDUALEM SISAY

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Summary

• State says action followed failure by several licence holders to commence operations on schedule.
• The law requires a company to commence exploration or mining within 90 days of signing a contract with the ministry.
• Local and foreign mining firms will be affected by the move.
• Gold ranks among Ethiopia's major mineral exports, generating around ...$440 million in 2011/12.

Ethiopia has cancelled over 50 mining and explorations licences, a government official has said.

The communications director at the Ministry of Mines, Petroleum and Natural Gas (MoMPNG), Mr Bacha Faji, said the action followed the failure by several licence holders to commence operations on schedule.

“We cancelled over 50 mining licences recently, mainly because the companies have not started operations on time as per their agreement,” said Mr Bacha.

The law requires a company to commence exploration or mining within 90 days of signing a contract with the government.

Over 200 licences cancelled

Mr Bacha said MoMPNG had registered 530 mining companies so far, including, the active, cancelled, transferred and under evaluation/ investigation licences owned by local and foreign entities as well as joint ventures.

The ministry statistics indicate that a total of 211 mining licences have been cancelled since 2004.

They include 130 owned by foreign firms, 49 joint ventures and 32 fully local-owned licences.

Though one out of three Ethiopians lives below the poverty line, earning less than $1.90 per day, recent reports show that the country was endowed with many natural resources, including gold, iron, natural gas and oil.

Gold ranks among Ethiopia's major mineral exports, generating around $440 million in 2011/12.

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