The mining industry is involved in the extraction of precious minerals and other geological

materials. Ethiopia’s mining sector has strong potential to contribute to the country’s long-term
development, social progress and economic growth, Economic Commission for Africa (ECA).

Ethiopia is a significant producer of gold and limestone, and also produces smaller quantities of
tantalum, salt and pumice. The latest EITI reporting shows that the mining sector accounted for 1%
of total exports and 14% of total employment in 2019. In its Growth and Transformation Plan,
Ethiopia has set as a target for its mining sector to contribute to 10 percent of GDP by 2025. Oil and
gas exploration activities are ongoing, although no commercially viable discoveries have been
found to date.

Placer gold has been mined in Ethiopia for more than 2000 years, but a significant large scale
mining sector has not yet developed. Artisanal mining is extensive and primarily focused on gold.
The gold is mined mostly from alluvial deposits in the Proterozoic terrains in the south, west and
north of the country, and is being mined by numerous artisanal and small scale miners (ASM).

In the south, there is also a small state owned mine called Adola, where alluvial gold has been
mined for over half a century. There is considerable gem mining, and some 90% by value of this
derives from opal mining at one locality in the North Wollo Zone. Concerning the large scale sector,
there is only one operating mine in Ethiopia, Midroc’s Lega Dembi gold mine, ranked number 170 in
the world in terms of value of production in 2012. A fairly mature gold project at Tulu Kapi, which
has IFC involvement, was on hold during the second half of 2013 but changes in ownership and
additional financing has now allowed for exploration activities to continue. The state-owned
Kenticha tantalum mine is a sizeable project, however production was on hold in 2013, as the state
attempts to privatize the mine.

In the fiscal pear 2011/2012, the Ethiopian mining sector contributed about 1.5% to GDP (tot. USD
32 billion). The sector accounted for USD 618 million (19%) of the country’s exports, with gold
making up close to 100% of the mining sector exports

Abundant mineral potential

Apart from gold, Ethiopia’s mineral potential is vast. With known occurrences of more than
30 metallic, industrial, agro- and construction minerals as well as rare gemstones. Ethiopia is
also home to one of the oldest geological surveys on the continent, the Geological Survey of
Ethiopia (GSE). Data provided by the GSE make both exploration and the acquisition of
brownfield projects easier for investors.
Available maps include:
Ethiopia’s mineral potential
Ethiopia has known occurrences of more than 30 minerals. These include:
Metallic minerals (gold, platinum, iron, nickel, chromite and base metals);
Energy minerals (lithium, graphite, tantalum and coal);
Cement raw minerals (limestone, gypsum, clay, pumice);
Fertilizer raw minerals (potash and phosphate);
Ceramics raw minerals (kaolin, feldspar);
Glass raw minerals (silica sand);
Dimension stones (marble, granite, limestone, sandstone, diatomite, bentonite, soda
ash, salt, graphite and sculpture);
Gemstones (opals, emeralds, sapphires)

Given the fifteen to twenty years that will be needed for the mineral sector in Ethiopia to
generate critical mass, the economic potential from the sector is clearly difficult to
predict. However, three scenarios, conservative, possible and probable, are generated,
and these are concerned with gold, potash, and tantalum and copper (these being the
commodities primarily explored now)

Table 2.1. Mineral and rock occurrences in main geological environments of Ethiopia.
Geological terrain Commodity Deposit types and key areas
Gold Primarily lode gold in greenstone belts
Au-Ag-Cu-Zn VMS-type in the northern terrain
Late Proterozoic Tantalum Pegmatite in southern terrain
bacement
(black, grey, Iron Basic intrusions in western and southern terrains;
green in Figure Quartz- banded sedimentary iron in western
2.1) terrain
PGE (+gold) Ultramafic intrusions, and related alluvial-eluvial placers in
Most important the western terrain
terrain for Phosphate Basic intrusions, together with Fe
metallic
minerals Dimension stone Several areas in the Proterozoic terrains
Refractory raw Southern terrain
Also materials:
dimension kyanite,
stone, graphite, talc
refractory Kaolin Southern terrain and in the Harar area (also in some
minerals and areas with Quaternary volcanics
ceramic raw
materials Feldspar & quartz Pegmatite in southern terrain and in the Harar area
Mesozoic Limestone A number of deposits in all three Mesozoic sedimentary
sediments & gypsum basins
(blue in Figure Silica sand Several deposits in the Mesozoic basins
2.1)

Important for
the main
cement raw
materials
Potash Evaporites in the central parts of the Danakhil
depression
Tertiary-Quaternary
volcanics and Pumice A number of areas in the felsic volcanics of the Rift
Valley
cedimentc (olive & Diatomite A number of areas in lacustrine sediments of the Rift
green in Figure Valley
2.1)
Bentonite A number of areas in lacustrine sediments of the Rift
Important for a Valley
number of Rock salt Occurs in some lakes in the central-southern part of the Rift
industrial Valley
minerals and Soda ash Opal occurs in the areas surrounding the northern,
gemstones central and southern parts of the rift valley, in Tertiary
volcanics
Also coal and
Gemstones Other gemstones such as beryl, emerald, sapphire,
epithermal
tourmaline and garnet are found mainly in the
gold
southern parts of the rift
Coal Lignite to bituminous deposits in sediments mostly within
Tertiary volcanic formations in southwestern and
northern Ethiopia
Epithermal gold Low-grade gold occurrences in the rift valley, northern
parts
Sources: Tadesse (2009); various promotional documents available at the GSE (www.gse.gov.et, accessed November
2013); discussions with MoM staff.

2.3. Mining and mine prospects in Ethiopia and the region

The purpose of this section is to provide a broad view of the geological potential by
describing on-going mining as well as mine prospects in Ethiopia and the surrounding
regions.

1. Gold
There is currently one operating large scale gold mine in Ethiopia, the Lega Dembi
open pit mine in the southern Proterozoic terrain, owned by Midroc Gold Mine Plc.
Lega Dembi opened in 1998 and has at an average produced some 4.5 t/yr (3.5
tonnes or 120,000 oz in 2012). In some two years’ time, the operation will continue
underground and also include the Sakaro deposit located right next to Lega Dembi.
Nearby, there is also the state owned Adola mine where alluvial gold (at least in part
derived from the Lega Dembi deposits) has been mined for over half a century.

STRATEGIC ASSESSMENT OF THE ETHIOPIAN MINERAL SECTOR 21

Extensive artisanal (and some small-scale) gold mining shows the potential for gold
in all the Proterozoic areas of Ethiopia. The total artisanal production in later years is
reported to have been about twice that of Lega Dembi, with some 7.2 tonnes of gold
(about 232,000 oz) reported by MoM to have been produced in 2011.

In Sudan, 800 km north of the South Sudanese border there is the 20-year old Hassai
gold mine, which is operated by La Mancha and it has so far produced some about
2.3 million oz of gold. There is also artisanal gold mining being undertaken around
the Hassai mine as well as across the border from western Ethiopia, and further
inland to the west.
One gold prospect in Ethiopia has reached an advanced exploration stage, Nyota
Minerals Ltd’s Tulu Kapi project. The project has established probable reserves5 of
16.9Mt @1.82g/t (totally 986,000oz) and indicated and inferred resources of 24.9Mt
@2.34g/t (totally 1,900,000oz) as of mid-2013. The project was on hold during the
second part of 2013 but recent ownership changes and additional financing has
allowed for exploration activities to continue. The project shows the potential for gold
deposits in the western Proterozoic terrain.

2. Polymetallic deposits
The Arabian-Nubian shield in Eritrea, Sudan, Egypt and Saudi Arabia hosts a number
of VMS-type polymetallic deposits. There are three advanced gold projects in Eritrea,
one of which has reached the mining stage. The Bisha mine commenced production
in 2011 and it is a high-grade deposit with gold and silver oxides at surface underlain
by copper and zinc sulphides. The resource statement of May 2012 estimates
contained metal of 529,371 tonnes of Cu, 1,539,085 tonnes of Zn, 970,000oz Au and
45,060,000 oz Ag in the Indicated and Inferred Resource categories.

3. Potash
There is as yet no potash mining in Ethiopia but the Danakhil depression in the far
northeast of the country holds significant potash reserves. Allana Potash has been
granted a full mining license and is planning to commence construction during the
first half of 2015 and start-up production in the latter half of 2017. Proven and
probable sylvinite reserves amount to 94Mt@28-29% KCl. Measured, indicated and
inferred sylvinite resources amount to 418Mt@28-29% KCl. The current mine plan is
for 1Mt/yr over 24 years. The sylvinite occurs in the uppermost sediment horizon.
Large carnallite and kainitite resources are present in lower horizons, which may be
extracted in the future. Other companies are pursuing exploration at nearby
localities.

4. Tantalite
The state-owned [Ethiopian Minerals Development Enterprise (EMDE)] Kenticha
tantalum mine located in southern Ethiopia has been producing tantalum in the
recent past and shows the potential for pegmatite-hosted tantalum in the area. The
production is currently on hold due to attempts to privatize the operation. This seems
to have failed and the current plans are for EMDE to continue production in 2015. The
uranium content of the ore is quite high (0.5%) and local processing to remove the
uranium would be required for many export markets.

5. Cement raw materials

The Ethiopian cement production capacity has increased from 2-3Mt to some 10-
15Mt/yr over the past couple of years. Raw materials for cement (limestone, gypsum,
clay and pumice) are plentiful in the Mesozoic formations of Ethiopia and mined
locally, often in close vicinity to the cement factories.

6. Other industrial minerals

Rock salt has been mined for a long time in the Danakhil depression through non-
mechanised artisanal mining. In the recent past, there have been attempts to
commence larger scale industrial production of salt in the area. Kaolin, silica sand,
soda ash quartz and feldspar, are or have been mined through artisanal and small-
scale mining.
7. Dimension stone
The most important producer of dimension stone in Ethiopia is the National Mining
Company (Midroc group). Marble from the Benishangul-Gumuz area in the west and
granite and limestone from around Harar in the east are turned into finished products
at the manufacturing facility in Awash, central Ethiopia. Sandstone and volcanic rocks
such as ignimbrite and basalt have also been quarried, mostly on a small scale for
local dimension stone use.

5 Mineral resources (inferred, indicated and measured) and mineral reserves

(probable or proven) are established in accordance with international standards, such
as the Jorc Code and the NI 43-101. They include estimations of the amount of ore
contained within a mineral deposit and form a central part of feasibility studies.

22 FINAL REPORT

8. Coal
Coal was mined on a small scale in 2008-2010 in the Delbi-Moye area, mainly in
attempts to substitute for import to provide cement industry with energy. There has
recently been renewed interest in this deposit.

9. Gemstones
Gemstones are produced through artisanal mining, and the major types of
gemstones found in Ethiopia include garnets, emeralds, rubies and opals. Opals
account for nearly 98% of precious stone exports of the country.

Opals from deposits in Mezezo (Shewa province) were mined from 1993, but were of
low quality and unstable (opals are sensitive to heat and water and can crack easily)
and therefore did not gain traction as an exportable product. Opals were allowed on
the exportable items list in 2005, but it was not until 2008 that the opal potential for
Ethiopia was more fully realised, with the discovery of opal from the North Wollo
Zone, in Amhara region. These opals were of much higher quality and considered
more stable than those of other areas in Ethiopia. The Wollo Opal (also known as
Welo) was presented at the Tucson Gem and Mineral Show in 2010 and has gained
popularity in the wider global markets since then.

Challenges
Lack of A clear legal framework
The existence of a modern and well-functioning Mining Cadastre and Registry System
and clear rules for the award of licenses
coordination between federal, regional and sub-regional
lack of skilled staff
land use related conflicts and/or disagreements in mining areas
infrastructure,
Geological data and information Airborne geophysical data
Mining reforms by the current Homegrown Economic Reform

 Formalizing and supporting artisanal and small-scale mining

 Reviewing gold pricing to reduce incentives for illicit trade
 Addressing political and legal issues with local communities and
 incentivizing miners to engage and invest in local communities
 Addressing technical and institutional barriers against large-scale mining
 projects
 Developing policies and institutional capacities to create a sustainable,
 inclusive mining sector with strengthened geological information and a
 diversified product base with a focus on industrial input
Table 2.2. More or less advanced exploration projects in Ethiopia. Mineral reserves or resources (see
footnote, page 22) have not as yet been established in accordance with internationally
recognized standards for any of these projects, except for Tulu Kapi.
Licens
Licensee Region/Localitp Mineral Exploration activities
e
Name Numb type
er
Benshangul Gumuz:
Stream, Soil, Rock Chip
Baruda-Bulen, Precious,
MOM\ Sampling, Trenching &
Ablarus, Bahu- Base &
026- Pitting, Ground
Anjakoya, Yabanja & Rare
124\97 Geophysics & Intensive
Midroc Gold West Tangoy Metals
Drilling
Mine Plc. Localities, Metekel
Zone
Benshangul Gumuz
Stream, Soil, Rock Chip
and Amhara: Base
MOM\ EL\ Sampling, Trenching &
Mentaweha Locality, Metals,
352\2010 Pitting, Ground
Guangua/ Dibate Gold, Iron
Geophysics & Intensive
Wereda, Agew Awi and Rare
Drilling
and Metekel Zones Metals
Stream, Soil, Rock Chip
Sampling, Trenching,
Ascom MOM\ Benishangul Gumuz: Gold and
Aster image interpretation,
Mining Plc. 387- Shungu and Nazali Base
Ground & Airborne
429\199 Metals
Geophysics & Intensive
9
Drilling
Donia Gonda Beneshangul Gumuz: Stream, Soil, Rock Chip
MOM/ Gold &
Mineral Sherkole Locality, Sampling, Trenching,
EL/4359/200 Base
Resource Asossa Zone Ground Geophysics &
9 Metals
Corporation Ltd. Drilling
Benishangul-
Gumuz: Oda Stream, Soil, Rock Chip
Rayan MOM\ EL\ Gold &
Godere Locality, Sampling, Trenching,
Investment 251\2007 Base
Mengi & Oda Ground Geophysics &
Plc. Metals
Godere Weredas, Drilling
Assosa &
Kamashi Zones
Stream, Soil, Rock Chip
Benshangul Gold &
056-319/99 Sampling, Trenching
Gumuz: Asosa Base
Airborne Geophysics &
and Kurmuk Metals
Initial Drilling
Benzu Gold
Mining (Eth) Oromia: Girja
Plc. Haramfama and
Gold & Stream, Soil, Rock Chip
MOM\ EL\ Genale Korcha, Meda
Associate Sampling, Trenching
409\2010 Wellabu, Adolana
d Airborne Geophysics &
Oddo Shakiso
Minerals Initial Drilling
Wereda, Bale and Guji
Zone
Tigray: Terakemti, Stream, Soil, Rock Chip
Harvest Mining Gold &
326-354/99 Nefasit, Hamlo, Sampling, Trenching &
Plc. Base
Igub, Adi-Nebrid Pitting, Ground Geophysics
Metals
& Drilling
 Tigray: Rahwa Locality,
Stream, Soil, Rock Chip
Ezana Mining TIG\ EL\ Asegde Tsimbela and Gold &
Sampling, Trenching,
Developmrnt 344\2008 Tsilemti Weredas, West Base
Pitting & Drilling
PLC Tigrat Zone Metals
1597-
Stream, Soil, Rock
Sheba 1602/2002 Tigray: Una Gold &
Chip Sampling,
Exploration (MOM/ Deriam Locality Base
Trenchingn& Drilling
Ltd. EL/73/2010) Metals
Tigray: Adi Dairo
Stream, Soil, Rock Chip
Locality, Laelay
Precious and Sampling, Trenching,
056-319\99 Adiyabo and Tahtay
Base Metals Ground & Airborne
Adiyabo Weredas,
Geophysics & Intensive
Tigray Western Tigray
Drilling
Resources
Incorporated Tigray: West
Stream, Soil, Rock Chip
Plc. Shire Locality,
MOM\ Precious and Sampling, Trenching,
Adiyabo and
0138- Base Metals Ground & Airborne
Tahtay Adiyabo
0182\200 Geophysics & Intensive
Weredas,
0 Drilling
Western Tigray
Tigray: Enticho
Locality, Kola Stream, Soil, Rock Chip
MOM\ EL\ Temben, Werie Precious and
Sampling, Intensive
254\2011 Lehe, Ganta Base Metals
Trenching, Airborne
Afeshum and Geophysics
Hawzen Weredas,
Central and Eastern
Orecorp Tigray Zones
Minerals Plc
Oromia: Yubdo Gold, Silver,
Stream, Soil, Rock Chip
MOM\ EL\ Locality, Yubdo Dile Copper,
Sampling, Trenching,
243\2011 Lalo and Nole Kaba Lead, Zinc
Airborne Geophysics &
Weredas, Western and Nickel
Drilling
Wellega Zones
Oromia: Genji Locality,
Gold, Silver,
Boji, Gimbi, Haru, Lalo Stream, Soil, Rock Chip
MOM\ EL\ Copper,
Asabi,Nole Kaba and Sampling, Intensive
244\2011 Lead, Zinc
Yubdo Weredas, West Trenching & Airborne
and nickel
Wellega Zone Geophysics
Gold & Stream, Soil, Rock Chip
MOM\ Tigray: Chini & Work
Associate Sampling, Trenching &
060- Amba
National Mining 067\90 d Pitting, Ground Geophysics
Corporation Plc. Minerals & Drilling
MOM\ Stream, Soil, Rock Chip
Oromia: Okote, Gold &
EL\ Sampling, Trenching &
Borena & Guji Zone Base
121- Pitting, Ground Geophysics
Metals
148\8 & Drilling
8
Stream, Soil, Rock Chip
Gold &
Nyota Oromia: Tulu Kapi Sampling, Trenching
127-128/97 Platinum-
Minerals & Anchore, Ground & Airborne
Group
(Eth) Ltd. W.Wellega Geophysics Geophysics &
Metals
Intensive Drilling
Stream, Soil, Rock Chip
MOM/ Oromia: Guji & Ankore, Gold & Sampling, Trenching
EL/372/201 Yubdo, W.Wellega Base Ground & Airborne
0 Metals Geophysics Geophysics &
 Intensive Drilling
Oromia: Siyo Hawi
0320- Gold & Stream, Soil, Rock Chip
El Mining Plc Wele & Metu
Associate Sampling, Intensive
0384/2000 Darimu and Gawa
d Trenching & Ground
Locality, Western
Minerals Geophysics
Wellega Zone
Stream, Soil, Rock Chip
Somali: Haramsam Sampling, Trenching,
MGM Gold MOM\
and Hasamite Locality, Gold Landsat Image
Mines PLC 016-
Liben Zone Interpretation, Airborne
022\99
Geophysics & previously
some Drilling
0002-
Gold,
0080/2002 Stream, Soil, Rock
Afar: Tendaho Siliver and
Stratex MOM/ Chip Sampling &
Base
International Plc. EL/4326/200 Drilling
Metals
9
MOM/ Afar: Gabala and Precious and Stream, Soil, Rock
EL/139/201 Gira Locality Base Metals Chip Sampling &
0 Drilling
SNNPR: Dizi, Gold & Stream, Soil, Rock Chip
ETNO MOM\
Sheka and Surma Associate Sampling, Intensive
Mining Plc. EL1262\20
Weredas, Bench d Trenching/ Pitting & Ground
02
Maji Zone Minerals Geophysics
Amhara: Sekota Pitting/Trenching, Ground
Access AMH\ EL\
Locality, Sekota Iron Ore Geophysics and Inferred
Capital 422\2010
Wereda, Zone one resouce estimation
Services S.C.
0130- Afar: Musley and Drilling & Down Hole
Yara Dallol B.V. Potash
0134/2000 Crescent Localities (Logging) Survey
MOM\
G&B Drilling & Down Hole
EL\240- Afar: Bada Potash
Central (Logging) Survey
242\200
African 1
Resources
3137- Drilling & Down Hole
Ltd. Afar: Dallol Potash
3150/2000 (Logging) Survey
(Ethiopia)
Source: MoM, Mineral Licensing and Administration Directorate (February, 2014).
s