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Chinese construction company CGC Overseas Ltd
requested an extraction permit for silk sand, a
major input in sheet glass manufacturing, in Ejersa
town of the Northern Shoa Zone, Oromia Regional
State, from the Ministry of Mines and Energy (MoME).
According to a Ministry study, there is over one
billion tonnes of silk sand in the area and
additional deposits in Harar, Dire Dawa, and the
Tigray and Oromia Regional States.
CGC, which is currently constructing the only sheet
glass factory in Ethiopia for 1.3 billion Br, needs
increased supplies of the silk sand input.
If approved, the silk sand area will initially be
given to the factory for 20 years. The government
gets a two per cent royalty fee from the
exploration.
MoME has accepted the company’s request and is
consulting the Regional State on the possible
existence of interested parties in the area needing
compensation.
Gebregziabher Mekonnen, minerals department head at
MoME, told Fortune he expects the company
would be granted the plot soon.
Once the survey of the area that is expected to take
two months is completed, the request would be
submitted to the Council of Ministers for final
approval.
Various offices in the capital have been working to
facilitate the factory’s erection.
The Addis Abeba City Land Development and
Administration Authority leased an 114,577sqm plot
to the company near the Jomo River in the Nifas Silk
Lafto District. The Administration has also
committed to making available infrastructure in the
area before CGC commences construction work.
The Addis Abeba City Roads Authority constructed a
road from the factory site to the ring road at the
Jimma gate, west of Addis Abeba, at a cost of 30
million Br. The company made an incentive request to
the City Land Authority, which awarded it 60pc of
the plot free of lease. The balance is based on the
area’s lease fee of 255 Br per square metre.
Sources at the City Administration told Fortune
that the company received the incentive because it
has been engaging in various investments throughout
the capital and the factory is also the first of its
kind.
Ethiopia’s annual sheet glass demand is increasing
with the current construction boom causing the
country loose a substantial amount of foreign
exchange for imports.
The Addis Abeba Bottle and Glass Factory, the
pioneer in the industry, and Day Light, a subsidiary
of MIDROC Group, currently are the only producers of
glass and bottles in Ethiopia.
CGC, established in October 2004, owns a crusher
plant in the Bole-Lemi area that exclusively
supplies aggregate to the Addis Abeba Housing
Development Project Office.
The company invested 15 million dollars to establish
the plant and imported construction materials worth
four million dollars. CGC also has signed its first
construction project with the Ministry of Water
Resources (MoWR) for construction of the Harar
potable water project for 48.9 million Br.
Recently, CGC has agreed with the Ministry of Works
and Urban Development (MoWUD) to supply 2,000 heavy
construction trucks.
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