AFRICAN DEVELOPMENT BANK

Immeuble CCIA, Abidjan, Côte d’Ivoire

African Natural Resources Center

E-mail: M.HARRATHI@AFDB.ORG       

Telephone : +225 20 26 32 13

Department issuing the request : AFRICAN NATURAL RESOURCES CENTRE

Position : TWO (2) CONSULTANCY SERVICES FOR DEVELOPMENT OF LOCAL CONTENT POLICY FRAMEWORKS FOR ETHIOPIA’S MINING AND PETROLEUM SECTORS

Place of assignment : Addis Ethiopia

Duration of the assignment : 3 months

Tentative Date of commencement : October 2019

Deadline for applications : 6 ^th October 2019

Applications to be submitted to : Maali Harrathi (M.HARRATHI@AFDB.ORG)

PS: Application e-mail must include the name of the Consultant Position that you are applying for. Any questions and requests for clarifications may be sent to: Maali Harrathi (M.HARRATHI@AFDB.ORG)

TERMS OF REFERENCE

CONSULTANCY SERVICES FOR DEVELOPMENT OF LOCAL CONTENT POLICY

FRAMEWORKS FOR ETHIOPIA’S MINING AND PETROLEUM SECTORS 1. Introduction

The African Natural Resources Centre (ANRC) is a non-lending knowledge building entity of the African Development Bank (AfDB) whose mandate is to assist African governments in maximising development outcomes from their natural resources. It does so by providing support to these governments to boost their capacity in achieving inclusive and sustainable growth from natural resources.

The Government of Ethiopia (“GoE” or the “Government”) is working to improve policy, legal and regulatory frameworks of the sector and intends to link the extractive sector to other sectors of the economy. To achieve this objective, the Government has requested for support from the African Development Bank (AfDB) and from the African Legal Support Facility (ALSF) to improve the policy and regulatory frameworks for the mining and petroleum sectors.

Supporting the Government in developing a local content framework for the mining and petroleum sectors is only one of several activities that ANRC and ALSF are providing.

The Need for Mining and Petroleum Local Content Policy Frameworks

 Ethiopia’s known mineral resources include; gold, platinum, coal, iron ore, nickel, and limestone. These are in addition to the oil and gas potential in the country. These extractive resources can be harnessed to support Ethiopia’s socio-economic development. One of the key pre-requisites in realizing this objective is developing the necessary policy and legislative frameworks to promote involvement of domestic companies in the provision of goods and services in the mining sector.

In addition to the active and relatively mature mining industry in Ethiopia, hydrocarbon resources have attracted a number of international companies into exploration. Oil companies actively involved in the country’s petroleum exploration undertakings include; Africa Oil, Calvalley Petroleum, Epsilon Energy., Falcon Petroleum, Southwest Energy, Tullow Oil, Pexco Exploration and GPB Global Resource. The Calub and Hilala gas discoveries in the Ogaden Basin with an estimated reserve of 4.7Tcf has attracted a number of companies. POLY-GCL is developing the fields. The project involves building an 800km pipeline from Ethiopia to the coast of neighbouring Djibouti, where plans are to build a liquefied natural gas (LNG) plant and export terminal.

Ethiopia’s Growth and Transformation Plan II is targeting an annual average real GDP growth rate of 11%. Ethiopian industry is projected to grow at an annual average rate of 20%, with projected growth of 21.9% in the manufacturing sub-sector; 31.6% in electricity, gas and water; 15.4% in construction; and

32.8% in the extractive sector. Transformation to an industrial economy requires strategic and systemic linkages with the rest of the economy. The extractive sector is well positioned to be a driver of this transformation. Aided by the Ministry of Mines, Petroleum and Natural Gas’s 25-year Mineral Sector Development Plan under preparation, the extractive sector aims to increase its contribution to GDP from 2% at present to 10% by 2025.

For the country to meet these growth targets and maximally benefit from the developments of the ongoing mining and petroleum sectors, local content would need to be enhanced. This will require development of local content frameworks.

Objective :

The main objective is to develop two frameworks for designing and implementing mining and petroleum sector driven local content policies in Ethiopia. Subsidiary objectives are to conduct a capacity audit of Ethiopia’s extractive and allied sectors to identify industries that can produce inputs as well as skills needed for the extractive and allied industries.

Scope of Work :

The scope will cover both the mining and petroleum sectors.

 Mining Framework :

• Review literature on local content and related activities in the mining sector ;
• Review current policy and legislation relating to local procurement in the mining sector, including previous and current attempts at local content development ;
• Review programmes of support by other development partners in the country’s mining sector, especially various research works, policy documents and assessments undertaken ;
•  Review Ethiopia’s industrial policy, legislation and other initiatives meant to boost procurement of locally manufactured goods and services ;
• Conduct capacity audit of Ethiopia’s mining and allied industries to produce goods used in the mining industry. The review should include quantitative mapping of skills, goods and services consumed by mining operations etc ;
• Identify successes and bottlenecks or barriers to achievement of local content ;
• Review infrastructure and institutional arrangements, and evaluate their bearing on the sector with respect to local content; and ;
• Share experiences with stakeholders and staff at the ministry of mines and petroleum.

Petroleum Framework :

1. Review literature on local content and related activities in the petroleum sector ;
2. Review past and on-going extractive sector projects especially, various research works, policy documents and assessments undertaken under the Supporting the Ministry of Mines (SUMM) project ;
3. Carry out an assessment of existing capacity gaps with the objective to ensure coherence between proposed local content requirements and the pace and scheduling of petroleum sector’s activities. The assessment should include quantitative mapping of skills and services needed in the petroleum sector ;
4. Review Ethiopia’s industrial policy, legislation and other initiatives meant to boost activities in the petroleum sector. Analyse which subsectors or clusters should be promoted (for example, oil field services, equipment and tools, petroleum products, petrochemicals, fertilizers etc.), and how these may enable the development of other subsectors and clusters that make use of the same input or output (engineering services, construction, etc.) ;
5. Identify business opportunities that the proposed 800km natural gas pipeline and the LNG infrastructure can generate ;
6. Identify successes and bottlenecks or barriers to achievement of local content ;
7. Review infrastructure and institutional arrangements, and evaluate their bearing on the sector with respect to local content; and
8. Share experiences with stakeholders and staff at the ministry of mines and petroleum.

Methodology and Duties of the Consultant :

The work will require a full time consultant working with the ministry of mines and petroleum. He/She will undertake desk research, complemented by interviews with relevant regulators and industry analysts. Field visits to obtain relevant data is highly recommended.

The consultant will report to the task manager appointed by the ministry. The duties and responsibilities of the consultant will include the following :

1. Prepare an acceptable work plan for the work ;
2. Review, analyse data and undertake the activities in accordance with the scope of work ;
3. Undertake interviews with relevant stakeholders and distribute questionnaires where necessary ;
4. Prepare inception and draft final reports with input from relevant stakeholders in Ethiopia and within the African Development Bank ;
5. Regular sharing of experiences with relevant stakeholders and staff of the ministry ;
6. Prepare PowerPoint presentations for validation and dissemination workshops; and
7. Analyse and integrate all stakeholder comments into the final report.

A meeting with the consultant will be undertaken to harmonise the methodology and agree on reporting, content and format of the draft and final reports.

Outcome :

The consultant(s) will produce a detailed report covering the scope of work, which should be useful to the Government of Ethiopia and to the African Development Bank. The capacity audit aspects of the study should indicate :

1. Capacity gap analysis and alignment of policy with the state market conditions ;
2. Number and capacity of existing industries producing inputs for the mining and petroleum sectors ;
3. Volume of goods imported as input into production in the mining industry ;
4. Local manufacturers of goods and their capacities, capabilities and main challenges faced. Etc ;
5. Service providers in the country’s mining and petroleum sectors ;
6. Imported services and complexity of providing the services in-country.

After the capacity audit, there should be a high level roadmap for engaging the government of Ethiopia and its partners in the development of local content policies in the mining and petroleum sectors. In addition, there should be local content policies developed and implementation plan generated for Ethiopia’s mining and petroleum sectors .

Timeframe

 The consultant(s) will be awarded a contract of up to 3 months. The activities will be undertaken in accordance with an agreed work program which fits well within the allocated timeframe.

Project Monitoring and Evaluation

In addition to the inception report, the Consultant(s) shall also submit a draft final report for review by relevant Government Ministries in Ethiopia and the African Development Bank. The Consultant(s) will subsequently analyse and address the comments from reviewers and integrate same in the final report.

The Consultant(s) will propose a table of contents of the report, which will be discussed at the pre-project meeting.

Consultant Qualifications :

If a single consultant is identified to cover both assignments in the mining and petroleum sectors, the duration of the consultancy will be revised accordingly. If no single consultant is identified, the services of two consultants will be procured to undertake the assignment.

The consultant(s) must meet the following criteria :

1. Possess at least a Master’s degree in geosciences, law, economics, engineering related disciplines of petroleum or mining ;
2. Adequate competence with a minimum of 10 years working experience in the extractive industry, covering policy, regulation, strategy, private sector and business development among others ;
3. Accomplished at least two related research studies in the last three (3) years ;
4. Expertise on local content will be an added advantage ;
5. Excellent written and oral English.

Consultant Selection Criteria :

The Consultant(s) will be selected in accordance with the African Development Bank’s Implementation Manual relating to the Procedures for Acquisition of Consulting Services funded by the Administrative or Capital Expenditure Budget of the Bank Group. The consultant shall be evaluated based on the following criteria:

Only the best candidates earning 70% and above will be shortlisted and requested to submit financial proposals.

Service Conditions :

The African Development Bank conditions for retaining short-term consultants will apply.