Oromos Should Boycott MIDROC Ethiopia Products; Force Shut Down Gold Mining in Oromia!

Albasa Dagaga

February 20, 2016

Mohammed International Development Research and Organization Companies (MIDROC)

MIDROC Companies are owned by the Saudi billionaire, Sheikh Mohammed Hussein Ali Al-Amoudi. Al-Amoudi Companies are operating in Africa, Europe, the Middle East, and the United States of America.

Who is Mohammed Hussein Al-Amoudi?

Mohammed Hussein Ali Al-Amoudi is a Saudi Arabian billionaire businessman. Al-Amoudi was born July 21, 1946 from his mother Rakiya Mohammed Yassin (Wollo) and his father Haji Hussein Al-Amoudi (Saudi Arabia). The 69-year-old is close to the Saudi royal family.

He was ranked by Forbes magazine as the world’s 63rd-richest person and was worth $12.3 billion in 2012. In early March 2015, had his net worth estimated at Forbes at $10.8 billion. Mohammed Al-Amoudi’s estimated net worth declined to $8.4 billion as of February 2016, according to Bloomberg, a relative fall in net value was linked to the global fall in oil prices at the time of estimation. This son of Saudi father and Ethiopian mother, Al-Amoudi started investing in Sweden in the 1970s. His construction company MIDROC scored contract to build Saudi Arabia’s nationwide underground oil storage complex in 1988 estimated at $30 billion project. This solidified his fortune. Today the Ethiopian economy is controlled by two large major conglomerates: his MIDROC (Mohamed International Development Research Organization Companies) and EFFORT (The Endowment Fund for the Rehabilitation of Tigrai).

In addition to his economic empire, Al-Amoudi seems to have built a sophisticated security apparatus akin to shadow government inside Ethiopia–Trust Protection and Personnel Services Pvt. Ltd. Co. (TRUST). According to Al-Amoudi, TRUST is “engaged in providing protection and other professional as well as personnel services on contract basis. It also renders services related to customs clearing and forwarding services, as well as safety and modern alarm services for interested organizations. The company started its service activities with the aim of modernizing protection and personnel services within companies in Ethiopia.” Only a country ruled by lawless rebels whose primary aim is robbery of that country will allow a foreign national (Saudi Arabian billionaire) to form such a sophisticated security apparatus inside their country.

MIDROC Ethiopia is a private investment company with about 70 group and affiliate companies that are engaged in multifaceted business sectors across the country.

MIDROC Ethiopia Technology Group

Al-Amoudi’s Ethiopia Business Empire

After TPLF controlled Ethiopia, Al-Amoudi moved to Ethiopia and started buying several companies from TPLF using government privatization program. In 1994, Al- Amoudi created MIDROC Ethiopia. He now has substantial business interests and owns a broad portfolio of businesses in construction, energy, agriculture, mining, hotels, healthcare and manufacturing, security firm amongst others; this makes his business empire one of two controlling the entire economic activity of Ethiopia, the other being EFFORT.

MIDROC operating in Ethiopian are not totally financed from al-Amoudi’s accounts. He usually secures loan from local banks. This enables him to transfer most of the investment risks to the local banks. For example, from 1998-2000, MIDROC was awarded Ethiopian government owned enterprises by acquiring the Lega Dembi Gold and Kenticha Tantalum mines, tea plantations, agriculture enterprises and a soft drink company (Pepsi Cola).  He borrowed from local banks in Ethiopia in order to partially finance these acquisitions. MIDROC’s total borrowing from the Ethiopian local banks is not publicly known.  However, one reliable source indicates, in 2008 MIDROC secured Birr 200 million ($21 million USD) from the Development Bank of Ethiopia (DBE) for its Derba-Midroc Cement factory. In July 2012 MIDROC borrowed 942 million Birr ($52 million USD at the then exchange rate) from the CBE.

MIDROC paid Public Enterprise Supervising Agency, 860 million birr Ethiopia for one of the country’s biggest farms, Upper Awash Agro-Industry Enterprise. The Al-Amoudi-owned Saudi Star Agricultural Development Plc plans to develop up to 500,000 hectares (1,200,000 acres) of Ethiopian land for sugar, edible oil, and grain production. In March 2011, Saudi Star announced a further investment of $2.5 billion in Ethiopian rice projects. Some 10,000 hectares have been taken up in 60-year leases and the company plans to rent an additional 290,000 hectares. The company had reportedly purchased $80 million in equipment from Caterpillar Inc.

In this article, I will highlight the negative impact of one of Al-Amoudi’s enterprises on Oromia and show why the enterprise must be shut down as soon as possible through people revolt.

MIDROC Gold Mine Pvt. Ltd. Co. (MGOLD)

MIDROC Gold Mine Pvt. Ltd. Co. (MGOLD) is one of about 30 major corporations with about 70 group and affiliate companies owned and operated by the Saudi billionaire Al-Amoudi. MGOLD is engaged in Mining and Exploration activities mostly in Oromia region. MIDROC Gold Mine PLC is led by the CEO who is also the General Manager. The company has four Operation Units: Mine Operations, Heavy/Light Duty Maintenance Operations Metallurgy Operations, Exploration; and seven service units. The company is actively involved in mining gold while being engaged in exploration to find new gold deposits.

According to 2014 data acquired from World Bank presentation on MIDROC, Gold Mine PLC employs a total workforce of 1,359 of which 1,328 are permanent and 31 are expatriates working at various capacities. MIDROC Gold also employs 492 employees on “secondement” basis from Trust Protection and Personnel Services PLC. MIDROC gold is exported in Doré form to a refinery in Switzerland. The gold doré bars are shipped to Argor Heraus refinery in Switzerland; the gold is then refined and sold to Commerzbank in Zurich Switzerland.

The Legadembi Gold Mine in Southern Oromia, is an open pit operation with annual production of 1.6 million tons of ore. The mine was privatized and awarded to MIDROC Ethiopia in 1997. According to MIDROC statement, yearly average production is about 4500kg of gold-silver doré (fine gold production is in the order of 3,500kg). MIDROC Gold Mine PLC owns and operates the Legadembi Gold Mine, which is located 500km south of Finfinnee. During the past 16 years, over 52 thousand Kilograms of gold and about 15 thousand kilograms of silver were produced from Lagadambi alone, bringing a total of $1.3 billion US dollars. See table below.

Legadembi mine in operation for the last 16.5 years.

Total production / Sale

Gold 52,044.71 kg

Silver 14,670.6 kg

Revenue from sales

Gold USD 1,249,428,016 (Birr 17,168,007,555)

Silver USD 5,860,253 (Birr 80,671,938)

Total USD 1,255,288,269 (Birr 17,248,679,493)

Midroc Gold Mine paid $175 million to acquire the Laga Dembi mine in 1997 to run the mine for 20 years. Laga Dembi is in the Adola gold belt 300 km southeast of the Finfinnee. In 2012, the World Bank said in its report “Diagnosing Corruption in Ethiopia” that “The mining sector in Ethiopia is a hotbed of corruption and hub for graft and fraud.”  There are “seven areas of corruption risk” in the Ethiopian mining sector”, according the World Bank, including the “three main risk areas” of “license issuing, compliance with license conditions, and mining revenues”. And fraudulent practices in “compensations and obligations to local inhabitants, contracts with contractors and suppliers to the mining companies, falsification by mining companies of product quality, and theft of mining products and equipment.”

The regime has no independent means of verifying the revenues of mining companies. According to the WB, “Collection of royalties and income tax apparently depends almost entirely on the mining companies’ self-certification of output and profit.  Whereas, in the area of revenue, “mining companies may deliberately understate output and profit and overstate costs to reduce royalties and profit taxes.”  

The World Bank in its 2012 report cover the entire spectrum fraudulent practices ranging from bribes, falsification of records, shakedowns and take downs of mining companies and stealing compensation designated for local inhabitants to criminal use of insider information and fraudulent shell corporations.

When local banks lend those millions to MIDROC Corporation it dries up the money supply to local small business that is the main engine of economic progress.

POTENTIAL FUTURE PROJECTS

According to MIDROC officials, there are currently two potentially economic projects within MIDROC Gold’s portfolio of ALEL, namely East Sakaro and Werseti Projects in Oromia. Sakaro is expected to contribute close to one tonne of gold production per annum, in the coming five years. Overall gold production is estimated at 17.5 tonnes. Both projects lie on the newly identified Tibiro-Sakaro-Ulaulo mineralized prominent shear zone, which extends for more than 20km, and are considered to have considerable upside potential. A 5-Year Strategic Exploration Plan is in place to advance the East Sakaro and Werseti Projects to feasibility within the next five years. Intensive trenching, geophysical surveys and prospecting drilling are also planned to test other targets already identified, with the aim of generating further drill-ready targets. MIDROC Gold is actively involved in exploration projects, which are located near the mine (Adola-Legadembi Exploration License – ALEL), and in another area some 600km northwest of Addis Ababa (Metekel Exploration License – MEL).

MEL covers 1964 sq km and is situated within the Tulu-Dimtu-Baruda Shear Belt of the western Ethiopia greenstone belt, known for numerous occurrences of gold and poly metallic minerals. Four key exploration gold targets of significant potential have been identified to date, namely Egambo, Aware-Doshe, Epar and Aydot-Fiti. Two other targets, namely West Tangoy and Meb-Anjakoya, have also been identified for copper and other rare metals.

The company’s 5-Year Strategic Exploration Plan has already been put in place and is being implemented. An underground mine is currently being developed beneath the open pit to extract deeper level ore – the commencement of full-scale underground mine operations is planned. The underground mine resources are planned to be developed and mined between 2007/08 and 2018.

MIDROC Gold is also planning to mine the deeper level resources of the present open pit mine, for this purpose an underground project is in progress. To date more than 3km of underground workings have been done, and the deeper resources have been evaluated for a minable vertical depth of 115m and a strike of 350m. The evaluation was done by 50m x 25m grid core drilling, which was conducted from underground cubbies. The ore bodies are open both down dip and along the strike, exploration drilling will continue for the deeper levels and other lenses that have not yet been evaluated.

Chief Executive Officer Melaku Beza in an interview with William Davison of Bloomberg news on March 12, 2012 in Finfinnee told him that the company plans to invest $150 million in the initial phase of production at Okote site in Oromia. Exploration conducted over 15 years shows the Okote site has 550 tons of gold deposit. The CEO said that the company can earn about $4 billion from harvesting just 73 tons from the more than 550 tons of gold deposit estimate.

Why MIDROC Gold must be shut down

Environmental Disaster in Oromia

Over the past two decades, the Saudi billionaire, Al-Amoudi’s MIDROC Companies have expropriated billions of dollars from Oromia natural resources and billions more from Oromo consumers from his diversified consumer products. One of these is MIDROC Gold.

During the past 16 years, MIDROC Gold has had a devastating impact on ecosystems of Oromia. In the immediate mining areas, there are lethally polluted lakes, toxic, acidic water that kills animals. The water, many people fear, has already tainted the area’s groundwater supply. The community experiences deforestation as a result of additional forest logging done in the vicinity of mines to increase the available room for the storage of the created debris and soil. Besides creating environmental damage, the contamination resulting from leakage of chemicals has also affected the health of the local population. The environmental impact of mining includes erosion, formation of sinkholes, loss of biodiversity, and contamination of soil, groundwater, surface water by chemicals from mining processes.

Development and Communities shared value—NONE for Oromia

MIDROC Gold Mine in Lagadambi alone brought in about 1.3 billion US dollars over the past 16 years for the Saudi billionaire. MIDROC Gold Mine contribution to development and to our communities- zilch. An incredible arrogance and demeaning of our people; dishonoring of Oromo goodwill; hatred of our people –pure evil. As a matter of good business practice, mining, executed responsibly, has the potential to provide socio-economic benefits to all stakeholders—investors; the communities who own or occupy the surface rights; the country as a whole, as a force for sustainable growth. But to succeed in achieving these, long-term relationships of trust and mutual respect must be established between the communities that owned the land and mining companies. Local communities expect to gain jobs, local procurement and community projects such as capital and know-how, creating value from such resources. In addition, communities expect mining companies to make significant contribution to physical infrastructure surrounding the mines. Gold mines often need access roads, water pipelines and electricity grids. Hospitals and medical facilities to monitor the health and environmental aspects of the community and the surrounding area. Increasingly these are built with an eye to creating regional or community benefits rather than being solely focused on the mine.

In the case of MIDROC, the entire community that owned the land is totally neglected and maltreated; the Oromia region is ignored. The Saudi billionaire loves exploiting Oromia resources, but loathed the people who owned the land, and so shared none. Oromia suffered all the negative attributes associated with mining, but none of its benefits. No employment, no infrastructure development, no schools and no hospitals for communities. Not a single Oromo is employed as head of the 30 or so corporation at a CEO level; out of 40 million Oromo. The communities experience deforestation, lethally polluted lakes, toxic, acidic water, too many very sick people and animals with symptoms related to toxicity and pollution.

All the benefits went to his sponsors TPLF, and to his kin and kinfolks. The Saudi billionaire showers TPLF fascist clique with millions of dollars and with highest positions his corporations. Over the past decades, Al-Amoudi gave military and financial support to TPLF tyrants and fascists with the full knowledge and awareness that these group is committing human rights abuses against Oromo and others. Thus, Oromos should force the shutdown of MIDROC Gold from Oromia. Oromos should also boycott MIDROC other consumer products at grassroots and professional levels.

Our boycotts will have a very clear outcome and a moral premise.  We should also understand the power of boycott when used appropriately and targeted correctly. During the 80s, growing international horror at the injustices of apartheid prompted a proliferation of boycott campaigns. The anti-apartheid movement insistence that a consumer buying WHITE South African products such as wine was as culpable as a multinational investor. Such international ostracism had a powerful effect on the ruling government. The rest as we know is history. Oromos can achieve the same now.

MIDROC ETHIOPIA AND CORPORATE LEADERSHIP LIST

MIDROC ETHIOPIA LEADERSHIP

CHAIRMAN

H.E. Sheik Mohammed Hussein Ali Al-Amoudi

Chairman and Owner

MIDROC Ethiopia

CEO

Dr. Arega Yirdaw

Chief Executive Officer (CEO)
MIDROC Ethiopia Technology Group and
General Manager, MIDROC Gold Mine Plc

MIDROC CEO Management and Leadership Services is organized under the Office of the Chief Executive Officer of MIDROC Ethiopia Technology Group and is led by a Deputy President. The company has three Management Leadership services namely Corporate Governance Service, Corporate Marketing & Business Development and Corporate Engineering, Quality & Technology Services and four operational leadership classifications where all the MIDROC Ethiopia Technology Group companies are categorized, Sub-Group A companies, Sub-Group B companies, Sub-Group C companies and Sub-Group D companies.

In order to facilitate an effective management of the company, the Management has placed different Policies and Procedures into practice.

MIDROC Gold Mine Management

CEO

Dr. Arega Yirdaw

Chief Executive Officer (CEO)
MIDROC Ethiopia Technology Group and
General Manager, MIDROC Gold Mine Plc.

ELFORA Agro-Industries Pvt. Ltd. Co. (ELFORA)

ELFORA Agro-Industries Pvt. Ltd. Co. member of the MIDROC Ethiopia Technology Group was established in 1997 to be a partner in the development of the Agro-Industries in Ethiopia. The Company operates in distinct sectors: Poultry, Abattoir and Agro-Processing, Farm and Real Estate Development Operations

Trans Nation Airways Pvt. Ltd. Co. (TNA), a member of the MIDROC Ethiopia Technology Group, is rendering the safest and most reliable Passenger & Cargo Air Transportation Services and Aerial Spray Services to its customers. TNA was established in April 2004, after receiving Air Operator Certificate (AOC) from Ethiopian Civil Aviation Authority and Business Operating Certificate from the Ministry of Trade.

addis Gas and Plastics Factory Pvt. Ltd. Co. (aGP), a member of the MIDROC Ethiopia Technology Group, was established in July 2003 and is engaged in producing Gaseous Products and Plastic products, as well as providing testing and repairing of high pressure cylinder bottles and valves.

addis Gas supplies equipment such as High Pressure Cylinders and Fire fighting equipment and related parts. It also gives services of inspection and refilling fire extinguishers.

Wanza Furnishings Industries Pvt. Ltd. Co. (WANZA), a member of the MIDROC Ethiopia Technology Group, was established in July 2003 and is engaged in manufacturing of wooden furniture used in offices, home and industries.

Daylight Applied Technologies Pvt. Ltd. Co. (DAYLIGHT), a member of the MIDROC Ethiopia Technology Group Companies, has introduced the first lamp factory in Ethiopia. DAYLIGHT was established in August 1994 and joined the MIDROC Ethiopia Technology Group Companies in April 2004 and currently the company is engaged in the production of glass bottles and glass related products, manufacturing of different crown corks, electro-mechanical installations and as cash register machine service provider.

Summit Engineered Plastics Pvt. Ltd. Co. (SEPCo), is a member of the MIDROC Ethiopia Technology Group, has become under the leadership of the Chief Executive Officer, MIDROC Ethiopia starting from March 2006. SEPCo is engaged in manufacturing and selling of plastic packaging products.

Blue Nile P.P & Craft Paper Bags Manufacturing P.L.C (BN), member of the MIDROC Ethiopia Technology Group, , has come under the leadership of the Chief Executive Officer starting from September 11, 2006 and is engaged in the manufacturing & selling of P.P. and Poly Products in Ethiopia.

United Auto Maintenance Services Pvt. Ltd. Co. (UAM), a member of the MIDROC Ethiopia Technology Group, was established in May 2007 and engaged in Auto Maintenance Services and Selling of different type of spare parts of vehicles.

Queen’s Supermarket P.L.C., a member of the MIDROC ETHIOPIA Technology Group deals with whole-selling and retailing of all kinds of other consumable products and provision of catering services at a large scale.

ADAGO MIDROC Trading P.L.C., a member of the MIDROC Ethiopia Technology Group, is engaged in the import and wholesale distribution of merchandizes such as construction materials, hardware, plumbing and heating equipment & supplies, Iron and steel, furniture, home furnishings, household electronic items, crockery, cutlery & kitchen utensil, Office machines and equipment, Fast Moving Consumer Goods such as food products, edible oils, beverages, confectionery products, hygiene products, pharmaceuticals, paper and stationary, beauty care products.

Summit Partners Pvt. Ltd. Co. is a member of the MIDROC Ethiopia Technology Group, and is under the leadership of the Chief Executive Officer, MIDROC Ethiopia. Summit Partner is engaged in plant, machinery equipment and Facility lease and rental as well as in the provision of skilled and professional manpower services.

Mr. Tadesse Habteselassie
General Manager

MIDROC GEO Exploration Sevice P.L.C. (MGEO)

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SOURCE: MIDROC CORPORATION HOME PAGE