Saturday, July 13, 2024

Aussie, European companies head south for gold


Another massive gold exploration license is expected to be given to European and Australian partnered companies in an exploration area in southern Ethiopia’s popular gold belt.
Crau Mining, which is under Crau Group, a Madrid based company with a branch in Addis Ababa, and the Australian mining firm Megado which formed a partnership to mine for gold at Adola belt has concluded a pre feasibility study before the application for the exploration license around Shakiso, according to Pablo Artinano, President of Crau, which has been working in other businesses in Ethiopia for the last half decade and wants to expand into real estate and industry.
The partnership is looking at licenses in sites at Mormora and Babicho, which are south and north of Lega Dambi gold mining area at Guji zone of Oromia region, about 400km south of Addis Ababa.
At the Babicho site 20 percent is owned by local geologist and investor Yonas Chemeda and Edossa Etanna, while in Mormora the full ownership is help by a foreign partner. “Local, Spanish and Canadian geologists have assessed the area for resources,” Crau’s President said.
Fikru Birhanu, Business Development Manager of Crau, told Capital that in the mining sector Australia and Canada are well known, “that is the reason we partnered with the well experienced Australian company,” he explained.
The project is expected to be financed by Patersons Corporate Finance, an Australian firm with over a century of experience.
Alex Rovira, Director of Corporate Finance at Patersons, who visited Ethiopian this week, said that his financial firm has supported various mining investments throughout the world. The company has experience in similar projects in Africa. “We are new to Ethiopia,” Rovira told Capital.
Early this week the leader of Patersons Corporate Finance, Megado and Crau met top government officials at the Ministry of Mines, Petroleum and Natural Gas (MoMPNG), Ministry of Finance, and Oromia Water, Mineral and Energy Bureau including Eyob Tekalgn, State Minister of Finance.
During the licensing process experts at MoMPNG provided the technical evaluation and the regional government gave an approval letter for the project expected to be approved by the federal government.
Mormora holds 203 km2 of land 57km to the south of Lega Dembi; Babicho sits on 136km2 just under 20km to the north. On its website Megado stated that the early reviews conducted suggest these two sites exhibit very similar if not exact replicas of the geological formations found at Lega Dembi.
The exploration phase could take four years and the total cost shall be USD 30 million.
The Australian company that filed to be listed at the Sydney Stock Exchange is expected to be approved in October making it the second gold mining company registered on the international capital market that invests in Ethiopia. The other company, Kefi Minerals, which is in the process of developing gold in western Ethiopia, is registered at the London Stock Exchange.
Listing at the international capital market makes the business of the company more reliable and helps it to operate responsibly since it needs clear information for those who would be involved as shareholders.
Lega Dembi, which currently suspended its activity, is the only gold mining company on the industrial level. The Kefi project is in progress to mine the precious metal. The activity of the partnership at Mormora and Babicho would be the other big exploration project.
Pablo stated that the exploration license would be approved in the coming few weeks.

Read more