Faith Nyasuguta
Ethiopia is preparing to join the ranks of Africa’s major gold producers with the upcoming launch of the Kurmuk Gold Mine in Benishangul-Gumuz. Backed by an investment of around $500 million, the project is expected to deliver its first gold by mid-2026 and is being hailed as a potential game-changer for the country’s mining industry.
The Kurmuk project, developed by Allied Gold in partnership with the Ethiopian government, marks Ethiopia’s first industrial-scale gold operation, moving the country beyond decades of reliance on small-scale and artisanal production. The government has secured a 7% stake in the mine, ensuring that national revenues flow directly into public coffers.
Production targets are ambitious. In its first five years, the mine is expected to deliver about 290,000 ounces of gold annually, with life-of-mine production averaging more than 240,000 ounces per year. This output would make Ethiopia an overnight entrant into Africa’s mid-tier gold producers. Importantly, the mine is structured to be cost-efficient, with all-in sustaining costs projected below $950 per ounce – thanks to a favorable $0.04/kWh hydropower deal.
The mine’s design will draw on two open pits, Dish Mountain and Ashashire, which will feed a six million tonne per year processing plant. Initially set for a 10-year life span, the Kurmuk Gold Mine holds expansion potential that could extend its operations significantly.
The economic implications are far-reaching. At current global gold prices of $2,000 to $2,300 per ounce, Ethiopia could earn between $580 million and $670 million in annual export revenues, injecting much-needed foreign currency into the economy. For the government, expected royalties, taxes and profit shares could bring in $100 to $150 million annually, while dividends from its equity stake would provide an additional revenue stream.
Beyond state revenues, the project promises significant job creation and community development. At peak, Kurmuk is projected to employ 1,500 workers directly, with thousands more benefiting indirectly through contractors, suppliers, transportation, and service sectors. Allied Gold has already spent over $100 million locally in 2024, underlining the scale of domestic economic activity linked to the mine.
The project is also leaving a long-term infrastructure footprint. A new 75-kilometer transmission line built for the mine will not only power the operations but also enhance the electricity grid around Asosa, improving energy access for nearby communities.
Currently, construction is advancing with civil works, camp building, and contractor mobilization well underway. Mining is scheduled to begin ramping up by mid-2025, paving the way for first production the following year.
For Ethiopia, Kurmuk is more than a mining venture. It represents a milestone in the country’s quest for economic diversification and industrial development. If the project stays on track, Ethiopia could soon find itself positioned as a serious player in Africa’s gold sector, gaining stronger foreign currency stability, job creation, and critical infrastructure growth.
By 2026, the Kurmuk Gold Mine may not just be producing gold -it could be shaping Ethiopia’s economic future.
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