ABDI AND------------

PARTNERSHIP
LIMESTONE BLOCK MINING
PROJECT PROPOSAL
AT
HAKIM GARA

June, 2022
 1. Introduction

Dimension Stone is produced from quarrying. Quarry operations typically involve isolating a
mass of stone by cutting it free from the parent mass on all sides but one. The isolated mass is
then lifted or separated from the parent mass by breaking it free or by undercutting it with a
wire or chain saw. The freed stone can either be a mill block (block suitable for either sale or
resizing) or a quarry block (a much larger block size). Quarry blocks are subdivided by
breaking them into smaller blocks that can be removed from the quarry and sent to the mill.
Typical mill blocks range in size from 12 to 30 t, but they can reach weights as large as 65 t.
Quarry operations thus involve cutting the stone, breaking the stone, and removing the stone
from the quarry.
Uses:
Rough block production represents more than half of the dimension stone produced annually.
Rough blocks of various dimension stone are used mostly in construction and to make
monuments. Dressed stone is used to make curb stones for streets, flagstones for roofs and
walkways, and other decorative uses such as for carvings and statues.
Dressed stone represents more than half by tonnage of total dimension stone sold or used.
So I am interesting to get a license to establish lime stone block mining quarry to provide the
block to the existing demand market.
1.1 location

Hakim Gara limestone deposit is located at 525 km east of Addis Ababa in Harari Regional
State on the gentle slope of mount Hakim, which is 5 km south of Harar town, administrative
center of the region. The concession area (requested area) for the deposit, 15,000 m 2 is
bounded by the geographic coordinate points in the following table.

Corner Longitude Latitude

A 420 07’35.4”E 90 16’50.3”N

B 420 07’37.1” E 90 16’48.2” N

C 420 07’42.1” E 90 16’49.9” N

D 420 07’41” E 90 16’52.3” N

 1.2 Accessibility

The concession area is connected with Harar town to all weather roads leading to old Fedis
road.

1.3 Relief, climate and vegetation

The limestone deposit is situated on the gentle slope of Hakim Mountain and the area is
bisected along East-West direction by a valley which is filled by alluvium which creates
fertile land for the local farmers to produce various kinds of crops. The elevation reaches
2186m at the top where as at the foot of the hill, it is 2126m. The area which is covered by
sparse thorny bushes gets annual average rainfall of 750mm while its annual average
temperature is 200C. There are no seasonal or perennial streams that drain the area.
 2. Geology

The geology of Harar region is characterized by five litho logical units ranging in age from
Pre-Cambrian to Neogen, according to Greitzer (1961). These are, from old young;

Basement complex which is an assemblage of Granites, Gneisses, and schist sandstone unit
(Adigrat sandstone) composed mainly of sand stone alternating with many layers of marl,
chalk, and limestone which is 80m-90m thick resting uncomformably on the former, Lower
limestone unit, which is 170m-180m thick, consisting mainly of Limestone with many macro
fossils, Upper limestone unit which is 40m to 50m thick, composed mainly of grey limestone
and a unit which is neogen in age. The upper and lower limestone units are named together as
Hamanlei formation by other investigators like V. kazmine (1972)

It is within this formation (Hamanlei) that the Hakim Gara Limestone deposit is found.
Detailed geological study has also divided the limestone into two units, namely upper and
lower limestone units.

The lower limestone unit covers the area extending from the foot of the gentle slope exposing
the upper limestone up to the road. It shows vertical variation in which a layer of micritic
limestone overlies intercalation of thick and thin beds. The micritic limestone, having more
than 50 cm unit bed thickness, is very fine grained, light gray to white in colour, compact,
massive and hard whereas the intercalation is fine grained grey to light grey, and has beds
that are up to 1m thick.

The upper limestone unit, which is a calcarenite limestone occupies part of the area forming a
gentle slope and lies over the lower limestone unit. It has colours ranging from light brown
though grey to light grey and is fine to medium grained. An individual bed thickness in this
unit is commonly between 50cm to 1m. Occasional fossil structures of bivalves are also
embedded in this rock type.
The limestone covering the whole area has remained unaffected by large scale tectioc
structure such as faults and folds since its deposition. It is, however, affected mainly by
north-west trending joint set which are vertical to sub-vertical and rarely by south—west
trending joint set.

Measurements regarding the joints are given bellow:

Strike joint spacing

Joint set l 2750 - 3350 0.3m-3m

Joint set ll 1900 -1600 1m-2m

 3. Reserve

To estimate the reserve of the deposit, the following parameters are considered.

T= average thickness of the upper limestone unit measured from geological cross- section
which is 10m.

A= the total area covered by the deposit which is 15,000m2.

V= volume of the deposit

V=TxA

V=10mx15,000m2

V=150,000m3

The total reserve of Hakim Gara limestone deposit is calculated to be 150,000m3 as shown
above. It is, therefore, adequate for many years if mined at a rate of 2,000m3 per year.

4. Objective

The main objective of this project is engaging in the mining of limestone blocks from Hakim
Gara, creating job opportunity, generating income and contributes to the government revenue
in the form of royalty and taxes.
 5. Scope of work

Prior to quarry operation, the main preparatory undertakings that must be accomplished to
facilitate mining are:

1. Site preparation.

2. Power supply and machinery erection.

5.1 Infrastructures

The deposit area is situated around the quarry leased by different associations. Hence, a 5km
all weather road , connects the quarry sites with Harar town. Banking and telephone services,
offices, warehouses and canteen to be rented are all available in Harar town where the
company will station its main office. Regular flights from Addis Ababa to Dire Dawa, which
is only 55km from Harar, creates favorable condition to use air transport whenever necessary.

A constant water supply will be maintained for those quarry machineries which need water
during operation. This can be possible by transporting full tank from the nearest point of the
town water.

Power supply for electrically-operating machines is obtained from a generator which will be
erected at the site whilst those machines which are operated pneumatically will have
continuous flow of compressed air from compressors to be installed at the site.

Earth moving and lifting machinery will also aid the quarry work intensively in clearing out
the overburden, separating blocks from cuts in parent rock body, dragging and transporting
extracted blocks within the site and loading finished blocks which are well trimmed and
squared respectively.

5.2 Mining Plan/Procedure

Before the area is developed into open mining site, pre-operational activities and preparations
will be accomplished.

As the area to be developed is immediately next to the different quarries , it will be necessary
to construct the road which leads to the proposed area. In addition, it needs to remove the
fractured/jointed and weathered overburden with bulldozer by way of baseline (N-W) so that
working bench is prepared and extraction of blocks will then proceed along the dip direction
(E-W).

A compressor which can generate 7 atmosphere of air is stationed at the site to supply
pneumatically operated quarrying equipment with compressed air.

Having been cut by the machine, the block will then be pushed by a jacking plant which can
exert a pressure of 600 kg/cm2 on the block to separate it from parent mass. The block will
also be strapped with a 22mm cable and dragged out with loader to a place where squaring
will be done for final loading or stocking.

After being labeled with numbers and coded with letters, the extracted blocks will be stored
in stocking area and supply to my processing plant as well as to the market demand.

5.3 Environmental Impact

Generally speaking it is well understood that mining is not environmentally friendly activity.
But in block mining no chemical reagents are required and explosives such as dynamites are
not used. Therefore, in comparison to their mining activity the hazardous impact of block
mining is minimum.

Some parts of the project area are naturally covered by floras (small trees) so that it will be
necessary to use the excavator to clear the area with a minimum environmental risk if the
project is implemented. The quarry and stone crushing plant sites are located at a
considerable distance away from settlement area and the existing infrastructures such as road,
power lines, etc. So the exposure of the locals to noise, vibration, dust and any other
environmental hazards resulting from the project operation is minimal. Dust will be
controlled if possible by frequently showering with water for the safety of the workers as well
as the society in relatively distant areas around the site.

For the purpose in the later case, water is available from the nearby source as much as
possible because there is no water source at the site.

Physical impacts on the environment are probable mainly due to excess excavation of the
stone. The process involves excavation and quarrying of the granite, loading and transporting,
which may entail topographical changes and generate noise during the operation.
 5.3.1 Measure to be taken

The following quarry management techniques will be implemented or taken in to account as

to intervention menses for the environmental impact.

- The quarry development activity should be carried out using bench system and
opening different fronts within a single bench that will enable us to control the surface
run off within the confined small area.
- Since the area is a recharge area it is evident for one to anticipate weak krastic rocks
with solution holes. But these rocks are not of desired quality block (Fractured and
affected with solution cavities filled by calcite crystal). So identification of the block
to meet the necessary requirement before cutting is one way avoiding the risk
- Because even after production the blocks are to be discarded so it is important
(valuable) for the project to give special due attention be both profitable and avoid the
environmental impact
- The excavated overburden has to be piled up but not dumped away simply this will
help us to make the rehabilitation method effective. The pilled overburden is
accumulated in such a way that it can easily be used for reclamation activity.
- To reduce the rehabilitation cost, effectively utilize the resource. The abounded
blocks will be crushed and used as raw material for processing terrazzo, cheeps etc.
 6. Resource requirement

The resources required to develop the area into an open mining site are highlighted below.

6.1 Finance

A total amount of Birr 1,218,000 has been invested for all quarry activities. And

Its break down is shown as follows.

6.1.1 Pre-investment cost

No. Description Cost (in Birr)

1 Exploration and site preparation 100,000

6.1.2 Fixed investment cost

No. Description Qty. Unit price Total price

1 Machinery and equipments

Loader 1 1,500,000 1,500,000

Compressor 1 500,000 500,000

Pneumatic hammer 3 40,000 120,000

Bindas 3 24,000 72,000

Rubber hose 2rolls 30,000 60,000

2 Office and camping equipment - 240,000

3 Total 2,492,000
 6.1.3 Operating cost

No. Description Amount (Birr)

Production capacity 100%

1 Salary and wages 582,000

2 Spare parts and production accessories 240,000

3 Repair and maintenance 110,000

4 Supplies 264,000

5 Administrative and sales expenses 70,000

6 Miscellaneous 100,000

Total 1,366,000

6.2 Manpower

The personnel required for the quarry work and activity are listed below:

Description Qty

General manager 1

Quarry supervisor 1

Salesman 1

Loader operator 1

Quarry workers 10

Clerk 1

Guards 4
 6.3 Machineries and equipments

The quarry machineries and other equipments that are necessary for the quarry work are
listed below:

Description Qty

Portable air compressor 1

Loader 1

Perforator 2

Jacking plant 1

Pneumatic hand hammers 4

6.3 Consumables and accessories

These are quarry equipments which will wear out through time while being used and they are
also helpful for smooth performance of the large quarry machineries.

Description Qty

Plunges and feathers 50 set

Tungsten carbide chisels

(of various sizes) 64”

Pneumatic tungsten edge sharpener

With replacement disc 1”

Rubber hose (40 mt.) with connections 2 rolls

 7. Revenue and Financial Evaluation

7.1 Revenue

The annual production capacity of the project is about 2,000m3 of limestone blocks.

During the initial year of operation the mine may not attain the envisaged full, capacity,
mainly due to the preparation period which may extend through the first six months, and to
some extent due less gained technical experience, to fully run the project. Hence capacity
utilization in the first year is assumed to the 50% of the annual production capacity that of the
remaining years being 100%.

7.2 Financial Evaluations

The financial and profitability analysis of the project is due considering the following
assumptions.

1. The average price 2,500 birr per m3 of limestone block is assumed to be constant
throughout the project life.
2. The preproduction cost is considered to be cost required to make some verification of the
resource, license acquisition and other pre production operation expenses, amortized in 10
years.
3. The annual operating cost amount 1,366,000 Birr is considered for 100% capacity
utilization, supposed to be attained starting from the second year.
4. The tax, royalty and other similar points considered in the analysis are based on Mining
Laws and Regulation of Ethiopia.
Based on these assumptions and the data in the preceding sections, the projects financial
evolution, in terms of profit and loss statement (in birr), is presented in the following table.
No Description Years

1 Cash flow 0 1 2 3 4 5

A Pre- 100,000
production
cost
B Fixed cost 2,492,000

C Operating 1,366,000
cost
Total 3,958,000
2 Sales rvenue 2,500,000 5,000,000 5,000,000 5,000,000 5,000,000

4 Rayality 75,000 150,000 150,000 150,000 150,000

(3%)
5 Depreciasion 249,200 249,200 249,200 249,200 249,200
6 Operating 683,000 1,366,000 1,366,000 1,366,000 1,366,000
cost
7 Total cost(-) 1,007,200 1,765,200 1,765,200 1,765,200 1,765,200
8 Taxable 1,492,800 3,234,800 3,234,800 3,234,800 3,234,800
income
9 Income tax 522,480 1,132,180 1,132,180 1,132,180 1,132,180
(35%)
10 Net profit 970,320 2,102,620 2,102,620 2,102,620 2,102,620
11 cash flow -2,592,000 -1,621,680 480,940 2,583,560 4,686,180 6,788,800
 8. Benefits and Beneficiaries

8.1 Infrastructural Development

Some kilometer rod will be constructed to provide all season access to the quarry site. As the
path leading to the area is muddy and water logged during rainy season, this will contribute
towards alleviating accessibility problems existing in the area.

8.2 Social Benefits

The planned organizational structure of the projects avails job opportunities for 9 permanent
employee and 10 daily laborers. This is believed to contribute to the reducing of
unemployment existing in the region.

During implementation of the project, employees will acquire experiences in mining industry,
thereby contributing to the development of mining skills in the country.

The project will also contribute to satisfying the demands of the ever-increasing construction
activities in the country.

8.3 Economic Benefits

The project’s employee will benefit from salaries and wages. The revenue to be generated
from the project implementation will benefit the investor and government, in the form of
income from profit and income tax & royalty payment respectively. The investor’s five years
cumulative earning from profit is forecasted to be 9,380,800 birr, while that of the
Government is 5,726,200 birr. The local community will also benefit from community
development fund made yearly starting from the project area land acquisition. The overall
benefit goes to the economic development of the country, in general.