All Africa reported that Vale South Africa Exploration Limited, a subsidiary of Vale Inco Limited, has acquired an industrial mining exploration licence in the Southern Regional State upon depositing one million dollars in a closed book account.

Vale Inco Limited has 500,000 shareholders and a market capitalization of around USD 160 billion. It has acquired a 1,822 square meters plot of land in Konso, Southern Regional State, 441 kilometers from the capital. Vale is seeking to explore copper, cobalt and nickel, which are used as raw materials for industrial and food production industries.

The company is the second largest nickel producer, which is used to produce stainless steel aircraft, mobile phones and fertilizer nutrients. Vale acquired a prospecting licence to assess the region's potential last year, before applying for the mining licence.

Mr Gebre Egzihabher Mekonen director of Mineral Operations at the Ministry of Mines said that "Since there is no detailed geological data's developed by the ministry, which requires heavy processing materials, the exact potential of the country is not known. The area is not considered to be a particularly lucrative field for this type of mine exploration, but since the company has made its own study before acquiring licence, they might be successful."

Vale is the second company engaged in industrial exploration, next to BHP Billiton, a British company engaged in potash exploration on 17,000 square meters in Dalol, located 603 kilometers from the capital. The lack of road infrastructure has created a lag in exploration works.

(Sourced from www.allafrica.com)