Ministry Endorses Minerals Exploration Licensing Directive

The Ministry of Mines this week endorsed mineral exploration licensing directive that will enable the minerals licensing and administration core process to issue minerals exploration licenses to companies.

A senior official at the ministry told The Reporter that the Minister of Mines, Sikenesh Ejigu, and the state minister, Tolossa Shagi, on Tuesday endorsed the directive. The legal department presented the draft directive to the ministers for endorsement.

After suspending accepting applications for exploration licenses for almost two years the ministry started receiving applications from companies last March. However, the Ministry did not yet start awarding exploration licenses until this week. A committee established in the ministry has formulated the draft directive and remanded it to the ministers last month.

“Since the directive is now approved the minerals licensing and administration core process will start issuing the exploration licenses,” the official said. However, he said it will not be an easy process like it used to be.

"We have started accepting applications for mineral licenses. Once the directive is approved we will start awarding exploration concessions," Minister of Mines, Sinkenesh Ejigu, told The Reporter two weeks ago. The Sinkenesh said that the ministry used to work on a first-come-first-served basis. That will now be altered into awarding licenses competitively for each concession.

The Ministry has organized a committee comprised of relevant experts to compare the merits of applications before granting a license. "The committee will evaluate each application for a concession and select the best proposal. We will not be working on first-come-first-served basis anymore," Sikenesh said. Dozens of companies have applied for exploration licenses.

Sources at the ministry told The Reporter that the ministry is hard hit by brain drain. Many professionals of the ministry have left in search of better payment. Like any governmental institutions the employees are underpaid. Experts of the ministry are joining the private mining companies and handling the new applications and supervisions work with the existing workforce will not be an easy task.

Dangote Industries, Allied Chemicals Plc, Rusf Gladwuneya Gold mining Plc, Ore Corp Minerals Plc, Sekota Mining Plc, and MSB Steel Plc, Indian mining firm, are among the long list of companies that submitted their applications.

The Ministry of Mines so far granted 262 licenses-206 exploration and 56 mining licenses-to 145 companies.-out of which 149 are owned by foreign companies, 62 by local and 51 licenses are on a joint venture basis. Currently, seven international oil companies-Africa Oil, Tullow, South West Energy, New Age, Falcon petroleum, Pexco and Afar Explorations-are prospecting for oil and gas in different parts of the country. The ministry this year anticipates earning 849 million dollars from minerals export-gold with the lion’s share. Last year the country earned 654 million dollars from mineral exports.
Source: The Reporter