ANS Mining S.C., a company formed by banking and insurance industry gurus, has joined Tulu Kapi Gold Mines as a shareholder.

Founding shareholders of the company gave approval for ANS Mining to own considerable shares of Tulu Kapi through a public-private partnership (PPP) arrangement during their general assembly held on February 15, 2020. With the new ownership scheme, the government will hold 22pc of the shares, while ANS Mining and KEFI Minerals will hold 33pc and 45pc of the shares, respectively.

KEFI Minerals and the government reached an agreement in 2017 to let a local investor join them, and ANS Mining S.C. was invited into the partnership the next year. Formed by a joint venture with KEFI Minerals and the government of Ethiopia in April 2015, Tulu Kapi Gold Mine S.C. signed a long-term mining agreement with what was then called Ministry of Mines.

The aim of having local investors in the company is to give ownership to the local people and let them benefit from the natural resources, according to Harry Anagnostaras-Adams, executive chairperson of KEFI Minerals, the company that operates the mining site.

KEFI Minerals, a London-listed company, specializes in gold and copper exploration with two ongoing gold mining projects in Ethiopia and Saudi Arabia. The company has also secured another concession to explore for gold on 1,100Sqm of land located adjacent to Tulu Kapi, which is situated approximately 360Km west of the capital.

Up to 300 million dollars is required for the development of the Tulu Kapi Gold Mine, of which 60 million dollars has already been invested. The concession period of the Tulu Kapi mining license extends to 2035, which is expected to be renewed. In the partnership, the government is obliged to contribute by developing infrastructure, such as roads and electric power.

"The partners have focused on ensuring a broad investor base with an explicit preference for institutional investors such as insurance and banking entities with a strong presence in Oromia Regional State,” Harry said.

ANS Mining was funded by Hailemelekot Teklegeorgis, former state minister for Finance & Economic Cooperation, Wondwossen Zeleke, a long-standing natural resources senior executive, Zafu Eyessuswork Zafu, former president of the national chamber and one of the founders of United Bank and United Insurance, and Alemshet Degife (Maj. Gen.), former head of the Ethiopian Air Force, among others.

To raise capital, the executives of ANS Mining are planning to start selling shares, according to Hailemelekot Teklegeorgis, a founding member of ANS Mining, which hopes to sell one billion Birr worth of shares with a par value of one million Birr starting this coming September.

The founders of ANS assert that the investment has a 27pc rate of return and will help the banking industry solve the problem of forex, since the company will generate foreign exchange from the export of gold.