Ministry in talks with international companies to develop gas reserves

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By Kaleyesus Bekele

The Ministry of Mines disclosed that it is holding talks with various international oil firms to develop the natural gas reserves found in the Ogaden basin. 

Briefing journalists on the ministry’s six month performance report Minister of Mines Engineer Takele Umma said that his ministry was holding discussion with giant global oil companies on ways how it can develop the natural gas reserves found in the Ogaden basin, in the Somali Regional State. Takele said the ministry is talking to GAZ Prom of Russia, ADNOC of U.A.E, Baker Inc of America and SINOPEC of China.   

“Certifying our reserves has given us a big advantage to attract major companies in addition to the better negotiating power,” Takele said. 

Netherland, Sewell & Associates, Inc (NSAI), a U.S.-based petroleum property analysis and consulting firm, certified the natural gas reserves in the Ogaden basin last August.

The firm’s final assessment and economic evaluation report put the total volume of natural gas reserves in Calub, Hilala, and Dohar areas at 7 trillion Cubic Feet (TCF).

“We will select a well-known global firm which has the knowhow, technology and financial capacity to develop the gas reserves,” Takele told journalists.

It is to be recalled that Ministry of Mines has revoked the petroleum development license of Poly GCL, the Chinese firm,which was licensed to develop the gas reserves in 2013 after it failed to execute the project, according to schedule.  

Meanwhile Ethiopia has generated 117.4 million USD from minerals export in the last six months, gold contributing the lion’s share. Takele said gold export has a promising future. According to him, 1,910 kg of gold was produced in the last six month. 

Two gold mines are being built in the Gambella Regional State in Kumruk and Akobo localities. The minister said the gold mine built by Akobo Minerals will commence production after three months. “We are trying to bring global mining companies to engage them in gold production in Ethiopia. We may need four or five giant mining firms. There are massive gold reserves,” he said. 

With regards to the steel industry Takele said local steel manufacturers used to import billet to produce reinforcement bar at a huge cost. According to him, more than one million tons of billet was imported ever year. Following a directive issued by the Ministry of Mines state enterprises and governmental organizations are selling scrap metals to steel factories. Local foundries are now producing steel using scrap metals. Takelesaid that the steel factories didn’t import billets in the last six month. “We will not import billets in the coming year and half,” he added.  

The minister said coal manufacturing plants are being built in various parts of the country. Cement factories used to import coal mainly from South Africa. And that costs the country direly. Initiated by the ministry, the cement factories are now using locally produced coal. Large coal deposits are found in the Benishangul, and Oromiya regional states.

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