The Ministry of Mines has revoked the potash extraction concessions it had previously granted to two companies, with officials citing their failure to get projects off the ground in the Afar Regional State.
letters Signed by Minister Habtamu Tegegn on January 31, 2025, and Obtained by The Reporter instruct Circum Minerals and United Potash PLC to pack up their projects and finalize the transfer of their respective land plots within a month’s time.
Circum secured its license to mine potash in Afar’s Berhale and Dallol woredas in 2017. The terms of the concession obliged the firm to begin commercial production of potash within nine years. However, officials have revoked the license due to a lack of progress.
“Your company has not conducted mining development activity and has failed to commence commercial production as per the provisions and the agreement. In line with this, a notification letter was written to you in May 2024 to fulfill your obligation. But there has been no progress on your side and you are unable to finalize the development work and start commercial production,” reads the Minister’s letter to Circum.
The letter notifies Circum’s managers that failure to respond within five delays would lead to the “immediate revocation of the license.
– Advertisement –
According to Circum Minerals’ website, the project site rests on an enormous 365 square kilometer plot in Afar, which is purported to hold several billion tons of potash that can be mined for more than 100 years.
United Potash secured a potash exploration license in August 2022, also in the Berhale and Dallol woredas. Mining laws compel the holders of exploration licenses to begin working within a month of receiving the license.
United’s license initially expired in August 2023, but the Ministry granted it a year-long extension. However, the company failed to make use of the time, and the license expired in August 2024, according to the Ministry.
“Accordingly, you are strongly advised to fulfill obligations including, but not limited to, customs formalities for goods imported free of customs duties and taxes within one month and settle land rent to the region (if unpaid),” reads Habtamu’s letter to United.
Biruk (Brox) Worku, the owner and general manager of United Potash, is also a major shareholder and manager of Kurmuk Gold, which is under the Allied Gold Corporation.
On the other hand, Nejib Ababiya is the major shareholder of Circum Minerals Potash Ltd. Nejib was a key player behind Allana Potash, a once notorious firm that was caught up in a highly publicized legal dispute with the government a decade ago. Nejib is also involved in Tuyu Moye Geothermal, Tigray Resources Incorporated, and a number of other projects.
Potash extraction has been a long-held ambition in Ethiopia as successive governments have looked to use the mineral as a stepping stone for the domestic production of fertilizers.
However, sources say neither Circum or United are able to bring those ambitions closer to fruition as they lack the necessary capital and technical capacity. Sources also raise questions about how the companies acquired the concessions in the first place.
.
.
.
#Mines #Ministry #Terminates #Circum #United #Potash #Concessions
Source link
