Ethiopia dicovers two new gold deposits worth $1.7 billion

Ethiopia discovers two new gold deposits
worth US$1.7 billion

6 November, 2009 | Reuters

British and Saudi companies reported finding important gold
deposits in Ethiopia raisin government hopes of significant income
from gold mining.

ADDIS ABABA (Reuters) - Two

mining companies have discovered

gold deposits in Ethiopia that could

yield up to 41 tonnes, a top

government mining official said on

Friday.

Gebre Egziabher Mekonen, head of

the Mineral Operation Department in

the Ministry of Mines and Energy,

told Reuters the Golden Prospecting Mining Co., a British firm, had
found a deposit of about 23 tonnes in western Ethiopia.

"Discoveries by the British firm indicated that there is a viable prospect
for gold mine development in the area. But it takes up to $200 million
further investment to exploit the resources roughly within the next five
to 10 years," he said.

Sakaro, a mining company operating under Midroc Gold Co., owned by
Saudi business tycoon Sheik Mohammed Hussein Al Amoudi, has also
discovered a new deposit estimated at 18 tonnes in the Lege-Dembi gold
belt, Gebre Egziabher said.

The Golden Prospecting Mining discovery is at Tulu-Kapi, about 450
km (279.6 miles) west of the capital Addis Ababa and near the border
with Sudan.

The company is also exploring another site near Tulu-Kapi, which has
indications of a separate reserve of 30 tonnes, Gebre Egziabher said.

Once the two proven gold deposits were developed into mines,
Ethiopia's annual income from the sector could reach up to $1.7 billion
a year at current prices, from the present $105 million a year, he said.

Ethiopia has earned $450.5 million from nearly 48 tonnes of gold
exports in the last 10 years, according to statistics by the National Bank
of Ethiopia.

The country says it has indentified possible reserves of up to 500
tonnes in different parts of the country.

Gebre Egziabher said 44 international and local companies were engaged
in mineral exploration throughout the country.

The government issued mining regulations in 1993 giving foreign
investors incentives such as duty-free imports of equipment and
repatriation of profits

Courtesy