The South West Ethiopia Peoples’ Regional State’s Mining and Energy Development Agency has revoked the licenses of 32 gold mining producers in the region during the current fiscal year. The decision follows a monitoring and inspection process that identified poor performance among several licensed operators.
According to Ato Gebremariam Setegn, Director General of the agency, the region currently has 58 small-scale and 12 traditional gold producers. However, inspections conducted in July 2024 revealed that 32 of these producers had shown very low performance, leading to the cancellation of their licenses.
The Director General also noted that 12 small-scale and two traditional producers have failed to produce any gold in the past six months. He warned that further action would be taken against those who do not provide a convincing justification for their inactivity.
In addition to gold mining, the agency has issued more than 20 coal production licenses, but only eight producers in the Dauro and Konta zones have commenced production. Others are still in the exploration phase, with some expected to enter production soon.
The mining sector in the region had initially set a target of Birr 20 million in revenue from royalties, new licenses, renewals, and land rent for the first six months of the fiscal year. However, Birr 35 million was collected, significantly exceeding projections. The Director General attributed this growth to macroeconomic reforms, which have led to an increase in gold sales to the National Bank of Ethiopia, boosting overall revenue.
The region is known for its vast mineral resources, with studies indicating the presence of over 36 different minerals. However, the current focus is primarily on gold and coal production. In the first six months of the fiscal year, 75.525 kilograms of gold were produced, falling short of the 150-kilogram target. Similarly, 50,000 tons of coal were produced, reaching only half of the 100,000-ton goal.
The Director General cited illegal activities and inactive producers as major factors contributing to the lower-than-expected production levels. He emphasized that efforts are underway to implement new regulations and procedures aimed at improving productivity and ensuring compliance within the mining sector.
Source: Addis Zemen
