Billionaire Saudi Finds 113 Tons Of Gold In Ethiopian Sands

Sau­di bil­lion­aire Mohammed al-Amou­di and reg­u­lar all round geezer has just found even more gold. In fact 113 Tonnes of it. Could be one for the port­fo­lio in the Gold-Bull run-up, but 24 months sounds very opti­mistic, but let’s see. Check back here in 24 months. OK?

Here is the Bloomberg report:

Nation­al Min­ing Corp., a close­ly held com­pa­ny owned by Sau­di bil­lion­aire Mohammed al-Amou­di, said it found gold deposits in south­ern Ethiopia that may pro­duce at least 10 met­ric tons a year, almost dou­bling nation­al out­put.

Explo­ration con­duct­ed over 15 years shows the Okote site in Ethiopia’s Oro­mia region has more than 550 tons of gold, of which 73 tons may be ready for extrac­tion with­in 24 months, Chief Exec­u­tive Offi­cer Melaku Beza in an inter­view on March 12 in Addis Aba­ba, the cap­i­tal. The com­pa­ny plans to invest $150 mil­lion in the ini­tial phase of pro­duc­tion, he said.

This area has huge poten­tial,” he said. “The rev­enue will be about $4 bil­lion in 20 years’ time” from the 73 tons and the gov­ern­ment will receive $1 bil­lion from tax and roy­al­ty pay­ments over that peri­od.

Ethiopia, the world’s third-biggest cof­fee grow­er, is diver­si­fy­ing its econ­o­my to reduce its reliance on agri­cul­ture, which accounts for 43 per­cent of the gross domes­tic prod­uct, accord­ing to African Devel­op­ment Bank data. Gold exports surged 75 per­cent to 11 tons in the fis­cal year through July 7, 2011, gen­er­at­ing $485.3 mil­lion. Earn­ings totalled $258.8 mil­lion in the first half of the cur­rent fis­cal year from $179.2 mil­lion a year ear­li­er, accord­ing to Trade Min­istry data.

I think min­ing devel­op­ment in Ethiopia will be the future hope of the coun­try for for­eign-cur­ren­cy income,” Melaku said. Last year, cof­fee ship­ments earned the coun­try about one-third of its total for­eign-exchange rev­enue of $2.8 bil­lion.

Gold Survey

Sur­veys con­duct­ed by South Africa’s Ven­myn Rand Ltd. have shown deposits of 113 tons of gold in the south­ern part of Okote, which is about 600 kilo­me­ters (373 miles) south of Addis Aba­ba, Melaku said. The area may con­tain more than 425 tons, Melaku said.

Ethiopia’s only com­mer­cial pro­duc­er of the pre­cious met­al is Midroc Gold, anoth­er com­pa­ny owned by al-Amou­di that was formed out of NMC to devel­op the Leg­edem­bi deposit. That mine, which is about 100 kilo­me­ters north of Okote, pro­duces about 4 tons of gold a year, said Melaku.

At peak pro­duc­tion, Okote may employ 5,000 work­ers and earn the com­pa­ny more than $500 mil­lion a year from 10 tons of the met­al, he said.

NMC, which is based in the cap­i­tal, was formed in 1993 when al-Amou­di bought the state-owned Ethio-Libyan Joint Min­ing Co. The sale was the first of a state-owned com­pa­ny to pri­vate investors by Prime Min­is­ter Meles Zenawi’s two-decade old gov­ern­ment, accord­ing to Melaku.

The state owns 5 per­cent of all gold oper­a­tions, levies an income tax of 35 per­cent and col­lects roy­al­ties of 8 per­cent, accord­ing to Melaku. Aus­tralia’s Nyota Min­er­als Ltd. (NYO) and Van­cou­ver-based Tigray Resources Inc. (TIG) both have dis­cov­ered gold deposits in the Horn of Africa nation. NMC also has found 18 tons of gold in the north­ern Tigray region, said Melaku.

Ethiopi­an-born Al-Amou­di is the world’s 61st rich­est man and is worth $12.5 bil­lion, accord­ing to Forbes mag­a­zine. His Ethiopi­an invest­ments include cement, hotel, soft drink and agri­cul­ture com­pa­nies.

See the full sto­ry at : http://www.bloomberg.com/news/2012–03-15/saudi-billionaire-s-gold-find-may-double-ethiopian-production.html

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