US mining giant Newmont Mining plans to expand its presence in Africa, whose extractive industry, it believes, has immense potential.
The company, which is among the largest gold producers in the world, has shown interest in Ethiopia’s gold mining industry and is exploring opportunities in the Tigray regional state.
According to Ethiopia Mines, Petroleum and Natural Gas Minister Tolosa Shagi, Newmont intends to engage in gold exploration and development on two concessions in Tigray.
“We have drafted a new strategy that enables us to attract interna- tional mining companies, and Newmont is among the companies that have shown interest in the sector,” he says.
Estimates show that Ethiopia's gold endowment amounts to 500 t.
Currently, the country produces less than 10 t of gold a year, but government wants to increase output to 40 t by 2020. In the 2012/13 financial year, Ethiopia earned $57.4-million from gold exports.
Although there are about 250 companies licensed in the mining sector, the only large-scale mine is operated by Midroc Gold, in the south of the country. The bulk of the country’s gold is extracted by artisanal miners.
Newmont has mining interests in six countries on five continents.
In Africa, the company has interests in Ghana, where it operates two mines and has invested over $2.7-billion, making it the largest single investor in the gold mining industry in the country.
The com- pany’s plans to expand its presence in Africa come at a time when the gold price has been on a downward spiral in recent years.