Habesha Cement Granted 60-Year Mining License


When Habesha's 2.34 Billion Br factory is completed, it will have the capacity to produce 1.4 million tonnes of cement annually




The Ministry of Mines (MoM) has granted a mining license to Habesha Cement S.C, for the excavation of minerals as an input for the company’s cement production.

The agreement was inked on Monday May 19, 2014, between Tolosa Shagi, Minister of Mines and Mesfin Abi, CEO of Habesha.

The contract allows Habesha to produce limestone, gypsum, clay and sandstone from 112ha of land in the West Shoa Zone, Oromia Region, at four different locations – in the Meta Robe, Ejere and Ada’a Bergag woredas – with a capital of 27 million Br. The land Habesha requested for pumice is a site reserved for forestation and wildlife development, and it has asked for a replacement.

These plants will provide raw materials for the Habesha cement factory, which will have a yearly production capacity of 1.4 million tonnes of cement. The company is expected to begin production in November, 2015.

Habesha Cement S.C was established in September 2008 by 30 shareholders with an initial capital of 600,000 Br. Construction of the factory, which will cost 2.34 billion Br,  is taking place in the Beketa & Koro Odo Kebele, near Holetta town, Oromia region (35kms away from Addis Abeba).

The contract will be valid for 60 years, until the minerals are fully excavated, and Habesha is expected to produce over 100 million tonnes of limestone over the next 60 years, according to Mesfin.

When the company starts production, it is expected to use 1.1 million tonnes of limestone, 70,000tns of gypsum, 288,000tns of clay, 72,000tns of sandstone and 450,000tns of pumice, annually.

“To get the approval, we conducted a feasibility study and environmental assessment on the areas and paid 30.4 million Br as compensation to the former owners of the land,” said Mesfin.

The number of cement factories in Ethiopia is growing. Between 2007 and 2013, the number of factories to join the market reached 24, with two more joining soon, Dangote and Ethio, in 2014/15, and then Habesha in 2015. Messebo, Mugher Derba and National cement are the most prominent cement factories.

The Ministry had licensed over 140 local and foreign companies to conduct the exploration and production of minerals up until December 2013, when North Holdings Investment Inc was given license for limestone, gypsum, clay and sandstone in the Amhara Region on 24,513sqm of land.

In 2011/12, eight mineral extraction and 53 mineral exploration licenses were given, 12 of which are for limestone, clay and gypsum mining, and 11 for the exploration of the same minerals.

Ethiopia’s limestone reserve is 171 million tonnes, mostly concentrated in Oromia, Tigray, Amhara, Harar and Dire Dawa.



By FASIKA TADESSE
FORTUNE STAFF WRITER

Published on May 25, 2014 [ Vol 15 ,No 734]


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