In your sector, National Mining Corporation is famous. Could you then give to our readers a brief historical background of the Corporation?
National Mining Corporation is the first private mining company in the country. It was established in 1993, and concentrated mostly on dimension stones. Then, it went on exploration of precious metals, specifically gold. Recently, we are on the exploration of base metals, which includes silver, and copper. In our activities with dimension stones, we are already exporting our products to the foreign market, to middle East, Europe, and to the United States through an Italian Company. In our first exploration, we have found good resources of gold, silver, and copper. With the privatization policy of the country, we have got the only existing gold mining in the country. We are already producing, and exporting gold at this stage. Our activities cover not only metals, but also exploration in oil and gas. In fact, we were the first to assist the Calub Gas Company, to get the maximum share of the company, and when the government decided to privatize this company, we were among the three big companies to bid for it. However, we have our own program for exploration in the Ogaden basil for oil and gas. With our diversification program, we already got into the distribution of LPG in the country. We have now our own retail shops, we are going to have our own retailing plant in the country, and storage at Djibouti port. If our exploration activities were to be delayed in the Ogaden, we will for sure continue with the distribution of LPG in the country. With the exploration, in the northern part of the country, we started with prospecting, as there was nothing done in the area. We started from scratch, and we got good results, which transferred us to the next stage, that is exploration. We have now good results of gold, silver, and copper. In the southern part of the country, we also have got another 500 square km of exploration area, where we already drilled and got very good results from gold. For the Legedembi gold mine, we updated the mine, improved the plant, and are now producing good amount of gold, and better than the government did. We are in a good shape.
Could you give us you recent financial results including the turnover, and the profit of the company?
Our turnover for the last years concentrated only on the dimension stones, that was about 70 million birr of total turnover. Since we have got a lot of investments in exploration, all our profit cost is underestimated. In general, we do not have net profit at this stage, because we are investing a lot in exploration. In our two projects, we have got an investment over 60 million birr for exploration investment. We are financing our exploration investment from our income, that is from the dimension stones. Of course, we have got some funds from the owners coming in from abroad in hard currency. That help us to cover consultancy expenses, and machinery purchases.
Ethiopia has lack of infrastructures, and you are operating mainly in some lost areas of the country. How do you challenge these problems?
Roads are skeptic problems. For exploration it does not make any change, because we are moving into remote areas, where we do not expect any infrastructure. Of course, poor infrastructure, has got an impact on our costs, specially on our export prices which makes it higher, and less competitive to the international market. We think that things are improving. Big roads have been constructed, and upgraded. In the future we think we will get relieved.
How do you confront the lack of skilled manpower?
For dimension stones, we have got several potential of human resources. We are training our people outside, in Italy, and we are also bringing technicians to the sides, and to the plant, to train the people. For the dimension stone, it is 100% performed by Ethiopians. For the exploration, we have got good potential geologists from the Addis Ababa University, and we do not really need ex-pats. However, for the mining sector, we have a problem of skilled manpower. The tradition is not still developed. Therefore, we are bringing in, more mining engineers from abroad.
Do you think that the current mineral policy of the government is competitive enough to invite, and encourage foreign investors in the sector?
The National Mining was the first foreign company to come in, with this new proclamation. The proclamation is getting improved from year to year, and I think this is to be competitive. It gives a lot of incentives. For instance, we had got a depreciation law of 25 % for four years, it gives a loss coverage for 10 years, that is also an incentive to invest more in exploration. Corporate tax has been decreased now to 35%, so I think the code is progressive.
Are you independent in making decisions, or is there an organizational correlation?
We are establishing a corporate office that is called Midroc Ethiopia. It will be a holding company when the law comes. So far, there is no law for holding companies. We are 100% autonomous, and we are a private limited company. We have got corporate guidelines which we respect, otherwise all our financial decisions, human resources decisions, are limitless independent, and 100% autonomous. We report to our corporate office, in budgeting, and accounting, so that they will be aware of what we are doing. Otherwise, all the companies are 100% autonomous. We are now establishing this holding company.
What was your strategy to export and penetrate into the international market?
Our products penetrate into the market by themselves. We have got unique dimension stones that are sky blue marble, and unique white marble with pink and green tint. We export the white marble to its birth place that is to Charara, Italy. We are exporting our pink tinted white marble to Bahrain, and we are exporting beige line stone, like the ones found in Sheraton, to the United States, North Carolina, through an Italian company. Our gold normally is exported to Switzerland. | Are you the only one in the marble market, or do you have some competitors? If yes, what are your competitive advantages against your main competitors?
We are the sole owners of the unique marbles. We explored ourselves, and got the unique marbles by ourselves. However, we have got competitors in other types of marbles, who are also exporting to some countries. We are strong in the marble installation in the country, because of our strong design consulting office.
Where do you see the best opportunities in the future growth of the National Mining Corporation?
National Mining Corporation will go in three sectors. Dimension stones will go as it is started, and mainly will concentrate on exports to far East, and the United States market. We are already looking towards new markets. We in fact exhibited our products in most international exhibitions, and got good results. We have also got a sister company in the United States, which is promoting our marble. Additionally, we are a member of the marble institute of America, and I myself am a board director of the institute. We have got a good access to the Unites States market. The other sector is the mineral sector. we will concentrate on gold as we have started it. The results of the gold exploration are very encouraging both in the South and North of Ethiopia. We will also look for other exploration sides, and targets. We will very much proof on the oil exploration, because we know there is abundant natural gas in the country. We will develop the natural gas in the future not only for fuel, but for fertilizers, and energy. We first explore, then process, and finally export.
Our readers are always interested in new business opportunities. In which areas of your activities are you really interested to attract new partners, and new investors?
We will be very much interested in attracting investors in the oil sector. In that sector we need expertise. We are not looking for finance, as our group is strong in financing, but we need the know-how in the oil sector, although our partners have got experiences. The oil sector is new, and not touched yet. Therefore, investors should be attracted to the oil and gas sector.
Being the general manager of the Ethiopian National Mining, how confident are you in the future of the country?
Sheik Al Amoudin, and the National Mining have contributed a lot in attracting investors to this country. National Mining was the first mining company, when privatization was started in this country. Now, we have over 10 companies, which followed the trace of the National Mining. I think sheik Al Amoudin has played a great role, the same with other investments. His investments in all sectors of the country have built confidence to other foreign investors to come in. Sheik Al Amoudin is half Ethiopian, but is confident in investing in this country. Every year, we are investing more. In our sector we are investing big amount of money in exploration, that will take a long time to get repayment. We are confident, and we think others will follow us, as they have already done it.
We also came to interview you as a businessperson. Could you give to our readers a brief historical background about your own professional experience?
By profession, I am a geologist, and specialized in mining and geology. I studied 6 years in Russia. After finishing my studies, I worked in the Legedembi gold mine. There I started as a mining engineer, then I was promoted as a general manager of a small balser gold mine near Legedembi. Afterwards, I joined the Ethio-Lybian joint mining company, which was also doing the dimension stones. There, I made all the projects in the dimension. We started the first quarry and then the plant. I was also involved in potash exploration, where huge amount of potash is used for fertilizers in the Danakil depression. I was the project manager for that exploration, and development program, which we did with a French group. Then, I had my own small mining company of dimension stone quarry, when the government started privatization. Since I grew up with Sheik Al Amoudin, and as he is a friend of mine, I told him to purchase this dimension stone plant which belonged to the government. I am now working with him as a friend and a manager.
As a more personal issue, what has been your most satisfying personal achievement, since you are the general manager of the Ethiopian National Mining?
When we took over the government dimension stone plant and quarry, they were bankrupt. We had to bring up that plant and those quarries. We made them profitable. That was a big satisfaction for me, and since I worked with the previous company, it was a success for me. The gold business have got a touch for me. Winning the Legedembi gold mine, and competing with over 11 international mining companies was also a success for me and for my company.
As a final message, what will be your final message to our readers?
I will suggest to your readers that, Ethiopia is a new country. It is not anymore the country which was known only for its starvation and war. The mining sector is not touched, and we have got a lot of mineral occurrences. There is a big opportunity in the mining sector, and investors who come to this country will not loose. I hope the war will end up very soon, and we that will come back to our development plan. I hope we will be a new country for investment. |
