Saturday, 07 June 2014 21:19

Mining & Energy

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Blessed with natural resources Ethiopia has one of the world’s largest potash reserves and presently inviting many foreign and domestic investors in Hydropower, natural gas and platinum, with affordable labor force Ethiopia is the second leading the continent staggering 48 million labor forces.

With the GDP growth of almost 11% in the last decade Ethiopia has become a destination to foreign investors across many business sectors. This business opportunity did not become an overnight success. Blessed with natural resources Ethiopia has one of the world’s largest potash reserve and presently inviting many foreign and local investors in Natural Gas, Platinum and also in Hydro power.

This emerging country in the hemisphere is becoming a giant attraction for investment either for roads, dams, electric city, mining or any other essential infrastructures.

For instance,

  • Seeking investment in renewable energy projects involving hydro, wind, geothermal, and bio fuels to take advantage of the global focus on renewable energy.
  • Increasing mobile telephone subscribers from 7 to 40 million and Internet service subscribers from less than 200,000 to 3.7 million.
  • Building a 1,500 mile-long standard gauge rail network and creating manufacturing plants for locomotive engines and railway signaling systems.
  • Quadrupling power generation from 2,000 to 10,000 megawatts, building 82,500 miles of new power distribution lines, and rehabilitating 4,800 miles of existing power transmission lines.

These in fact are a few to mention for a country of 95 million people, sitting second in population next to Nigeria with 100 million people.

Ethiopia offers excellent opportunities for mineral prospecting and development. Geological studies have identified a favorable geological environment hosting a wide variety of mineral resources.

According to the Ministry of Mines, Ethiopia has a substantial deposit of gold, tantalum, platinum, nickel, potash and soda ash. Among construction and industrial minerals are marble, granite, limestone, clay, gypsum, gemstone, iron ore, coal, copper, silica, diatomite, etc. geothermal energy resource also exists in good quantity. With regard to fossil energy resources, there are significant opportunities oil and natural gas exploration and development in the major sedimentary basins, namely the Ogden, the Gambella, the Blue Nile and the Southern Rift Valley.

Steps are being taken to improve the situation, including the creation of an environment conducive to private, local and foreign investment. While there is no restriction on private investors in developing any type of mineral resource, the greatest potential is in gold and rare metals, petroleum, precious and base metals, industrial minerals and dimension stones (marble and granite). Prospecting, exploration and mining licenses have been issued to foreign mining companies with an aggregate capital of ETB 11.7 billion in 2008/09. Of the total capital, Birr 509.6 million was injected into the petroleum project alone. In 2012/13, the proceed from the export of gold alone was USD 430.6 million.

The Ministry of Mines is responsible for the processing of license application, regulation of the mineral operations and the promotion of investment opportunities in the mining sector. The Mineral Operations Department is the focal point in the Ministry for the receipt of mining license application of a foreign investor.


The potential of Ethiopia’s renewable and nonrenewable energy resources is large, with the economically feasible hydropower potential estimated at 45,000 MW. It has large potential for geothermal energy generation. Nine of its major rivers are suitable for hydroelectric power generation.

The private sector can participate in electricity generation from any source and without any capacity limit. Transmission and supply of electrical energy through the Integrated National Grid System is, however, exclusively reserved for the Government.

But, private investors, both foreign and domestic, are allowed to operate an off-grid transmission and distribution of electricity.

Moreover, private investors are highly encouraged to engage in generating electricity in bulk and reach an agreement of power purchase with the Ethiopian Electric Service, a public enterprise, for transmission and supply of electricity through the grid system.


One of the most influential actors is the EEP. The EEP is basically responsible for approving approve electric power purchase and network service agreements; and also promote energy efficiency and conservation at national and sectorial levels;  issue energy audit code, energy efficiency standards code, energy efficiency labeling code, grid code, customers' service code, technical inspection code, quality service standard code, building electrical installation code, technical standard code and other codes; and supervise the implementations of same. This emerging country in the hemisphere is becoming a giant attraction for investment either for roads, dams, electric city, mining or any other essential infrastructures.

For those who are very much interested to invest in Ethiopia with the GTP 2015-2020) EEP planned to expand its general capacity to 28,000 MW.
Among those that are open for investments are as follows.

  • 7900 MW form Hydro                 
  • 420 MW from Bio Mass                 
  • 5200 MW from Solar
  • 500 MW from Geothermal        
  • 5200 MW from Wind

Lists of power supply from each station in Ethiopia.



Capacity (MW)





Awash II



Awash III






Finchaa Amerit Neshe



Melka Wakena



Tis Abay I



Tis Abay II



Gilegel Gibe I



Dire Dawa



Awash 7 killo






Gilgel Gibe II





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