A Break Trough Milestone – License to Mining Gold in Ethiopia
As part of our strategy to start mining gold in addition to the successful exploring business, Akobo Minerals paves the way for a resurgent Ethiopian mining industry clearing a major hurdle for investors being granted the right to hold and repatriate foreign currency from offshore accounts.
On the 30th of September, Akobo Minerals and the Ministry of Mines and Petroleum (MoMP) entered into an agreement governing the future mining of the Segele project, and also opening up the Ethiopian mining sector by agreeing to the right to hold foreign currency on offshore accounts, and to repatriate profits from the same accounts. This has been the most difficult hurdle in attracting international investors to Ethiopia’s mining sector. Akobo Minerals is very proud to have been able to work closely with the MoM to make this possible.
Probably the most important hurdle for opening up the mining sector in Ethiopia has now been solved by introducing international mining standard for repatriation of profitsJørgen Evjen, CEO Akobo Minerals
The agreement covers vital aspects of the mine development and operation. In addition to other rights and obligations, Akobo Minerals has secured new terms which promote valuable investment partnerships with Ethiopia, including:
- The right to hold proceeds from sale of gold in overseas USD bank accounts
- The right to freely repatriate profits from overseas USD bank accounts
- The right to a 5 year Mining Licence covering 16 square kilometres of the Segele mineralisation and other promising targets – extendable in 10 year increments
- Key clauses include
- Begin development and production programmes within 60 days and 15 months respectively
- Right to sell gold freely in international markets
- Payment of 5% Royalty to the Federal Government
- Payment of 7% free carried interest in the mining project
Akobo Minerals would like to congratulate H.E. Eng Takele Uma (Minister for Mines and Petroleum) in his mission to transform the Ethiopian mining sector into a competitive, proactive and attractive sector for international investments. By creating more transparency and supporting law abiding investors whilst also implementing new international standards making it easier to repatriate profits for mining and companies, the Ethiopian mining industry is now on track for a bright future.
“We are excited to have reached the stage of receiving a mining license, it is a credit to all the hard work that has been laid down over many years. I am impressed also by the changes seen with the Ministry of Mines over the last year, transformed into a partner open to find good solutions. Probably the most important hurdle for opening up the mining sector in Ethiopia has now been solved by introducing international mining standard for repatriation of profits, and also to seek competitive terms and conditions compared to other neighbouring countries.” Says Jørgen Evjen, CEO at Akobo Minerals
As part of the Mining Agreement, the company has committed to develop the Segele Mine in-line with the plans released previously (see press release, 27th September 2021). Akobo Minerals has a drilling program underway to extend the known mineralisation and in line with this, the mining agreement provides the right to extend the mining licence upon continued economic viability of the mine and fulfilment of all legal and contractual obligations.
As is normal for mining licences, the Ministry retains the right to withdraw the mining licence upon failure to perform as pursuant to Ethiopian Law.
For more information contact
Jørgen Evjen, CEO at Akobo Minerals
Mob.: (+47) 92 80 40 14