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MIDROC Gold Mine Plc, one of the subsidiary
companies under MIDROC Ethiopia Technology Group,
seems to have finally landed a breakthrough gold
reserve finding in East Sakaro, Guji Zone of the
Oromia Regional State. The reserve, found after four
years of intensive exploration, is estimated to
contain 17,250Kg of the commodity.
“We are pleased to announce that the mining industry
of the country with exemplary competence and
reliability is at an important historic juncture,”
says the press release issued by MIDROC.
The exploration activity was managed and run by
MIDROC Gold and a United Kingdom (UK) company,
Wardell Armstrong International, who was
commissioned to verify the result and present a
comprehensive feasibility and environmental impact
assessment report.
The January 2008 Wardell Armstrong feasibility
revealed that 6,683Kg of the find is proven by
exploration, and drilling will take place from 2009
to 2012. The remaining 10,567Kg will need further
ongoing optimisation work in order to extract the
gold from 2013 to 2017.
MIDROC Gold, the only company involved in
industrialised primary gold exploration, was
established in the late 1990’s by Sheik Mohammed
Hussein Ali Al-Amoudi, his wife Sofia Salah Al-Amoudi
and the government of Ethiopia with an initial
capital of 51.6 million dollars.
Sources told Fortune that the verification of
gold in East Sakaro by Wardell Armstrong has left
Sheik Mohammed, chairman of MIDROC Ethiopia,
overjoyed. Though he was supposedly eager to
announce the good news to the public in February
2008, he left for England for business. The
opportunity was grabbed by Arega Yirdaw (PhD), who
has been serving as the general manager and CEO of
the company since 2001 who on February 5, 2008,
disclosed the leap forward.
MIDROC Gold was created a few years after National
Mining Corporation (NMiC), another subsidiary
company of MIDROC Ethiopia, took the 20-year
concession of Lege Dembi Gold Mine from the
government in March 1998 for 172 million dollars.
The gold mine was transferred from NMiC to MIDROC
Gold, which has been managed by Arega.
Another groundbreaking discovery of a 10,743Kg gold
reserve was found in Lege Dembi.
The underground work of this exploration started in
2000 and was completed in 2007. The 4.2Km tunnelling
work was then excavated allowing Wardell Armstrong
to conduct a similar feasibility study.
“Development and exploration of Lega Dembi mine, the
first of its kind in the country, is in its final
stages and full scale ore extraction is expected to
start by the end of 2008,” said Arega.
MIDROC started production and exploration on the
mine based on the agreement with the Ministry of
Mines and Energy (MoME) in March 1998. The gold
reserve to be mined in an open pit was estimated at
37,215Kg. An open pit mining life was set at 10
years from 1998 to 2008.
The open pit was re-designed in 1998 and accompanied
with further improvements which increased the
estimated gold reserve from 37,215Kg to 51,039Kg
(37pc). The increase in gold reserve helped extend
the planned mining life of the open pit by three
years.
The latest finding will enable the mine life to
extend by 13 more years with an added gold of
70,000Kg amounting to 1.6 billion dollars.
MIDROC Gold started focused exploration work in 2002
and intensified by obtaining more exploration
permits beginning in 2004. Currently, MIDROC Gold is
engaged in two other exploration areas. Exploration
on the 1,965sqm site in Metekel Zone to the west in
the Benishangul Gumuz Regional State started in
January 2004.
“We expect even more from MIDROC Gold,” says Taye
Tafa, head of Metekel Zone.
The second exploration site is in Ulaulo, covering
an area of 441sqm and located south of Lege Dembi
mine. This exploration kicked off in March 2004.
Alemayehu Tegenu, minister of MoME told Fortune
MIDROC’s recent achievement is good news for the
country as the international price of gold (902
dollars per ounce) has been drastically rising.
“Our interest now is to see them kick off the
extraction as soon as they can,” said Alemayehu.
The reserve in East Sakaro was first discovered in
1975 by gold prospectors who mined the Sakaro
Valley, according to an expert. Sakaro was
subsequently visited by two Russian experts; A.
Kozarevitha and Makvin. The reserve was confirmed
after a geological survey was submitted in the
second half of 1979, a time in which visible gold
was found northeast of the Sakaro area.
Although Ethiopia’s total reserve of gold is yet to
be identified; Sakaro as well as areas in
Benishangul, Oromia, Tigray and Gambela regional
states are believed to include gold deposits.
Over 20 companies have shown interest to explore
gold in Ethiopia.
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