Deal #1189

Location #1

Spatial accuracy level
Administrative region
Location
Oromia, Ethiopia

Target country
Ethiopia
Comment on location
Land in several Woredas in East and West Hareghe Zones

Land area

Intended size (in ha)
56000.0
Size under contract (leased or purchased area, in ha)
[2007] 8000
[2008] 3800
Size in operation (production, in ha)
[2012] 1000
Comment on land area
3800ha in 2008 (Ethiopian Investment Agency). 1000ha castor seeds planted+peanuts (2012). Contradictions about current size under contract- one report states 10 000ha plus an outgrower scheme of 5000ha while another report states 15000hectares, without a mention of an outgrower scheme. Another report states approximately 62 000ha. Included in the original 8000ha- "The agreement with the Oromia government also includes some wild land areas, however, we have refused to start any exploration there and we are expecting to receive different land to be developed. " Another article claims 70 000 ha.

Intention of investment

Intention of investment
Biofuels, Food crops
Comment on intention of investment
The company shifted from castor oil plants to peanuts due to a freeze on edible oil prices by the Ethiopian government in 2011.

Nature of the deal

Nature of the deal
Lease
Comment on nature of the deal
Another data source states 50 year lease.

Negotiation status

Negotiation status
Intended (Under negotiation)
[2007] Concluded (Contract signed)

Implementation status

Implementation status
[2012] In operation (production)
Project abandoned
Comment on implementation status
Operations have been affected by the fighting between Oromos and Somalis. The company has been subject to insolvency proceedings since July 2015, and has been trying to attract investment.

Leasing fees

Annual leasing fee
76
Annual leasing fee currency
Ethiopian Birr
Annual leasing fee type
per ha
Comment on leasing fees
From unofficial source

Contract farming

Contract farming
Yes
Not on leased / purchased area (out-grower)
Yes
Not on leased / purchased area (out-grower, in ha)
72000
Comment on contract farming
Contract farmers were involved, covering 72,000ha in 2008. However, operations collapsed.

Contract #1

Duration of the agreement (in years)
45

Number of domestic jobs created

Jobs created (domestic)
Yes
Planned employees (domestic)
4000
Planned daily/seasonal workers (domestic)
12000
Comment on jobs created (domestic)
One report states that the company failed to pay its employees.

Operating company

Operating company
Comment on investment chain
Formerly known as Flora Ecopower. Acazis AG and Herakles Farms, LLC have signed an extensive Memorandum of Understanding for a collaboration regarding agricultural projects in Africa- particularly in Ethiopia- Herakles Farms came to assess the plantation in 2013- but ultimately no partnership deal was reached.

 

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Data source #1

Data source type
Research Paper / Policy Report
File
Date
2010-01-01
Comment on data source
"German investment funds involved in land grabbing", by Profundo, 2010.

Data source #2

Data source type
Other (Please specify in comment field)
File
Date
2013-03-19
Comment on data source
Sue Mbaya for LSLBI project East Africa

Data source #3

Data source type
Media report
File
Date
2010-04-27
Comment on data source
Afrik News -- Ethiopia: German biofuel company fails as employees abscond with assets

Data source #4

Data source type
Research Paper / Policy Report
File
Date
2013-05-13
Comment on data source
ODI- Scoping Report in Biofuels projects in five developing countries by Anna Locke and Giles Henley

Data source #5

Data source type
Media report
File
Date
2014-01-07
Comment on data source
Biofuel Development

Data source #6

Data source type
Media report
File
Date
2014-01-07
Comment on data source
Bloomberg Businessweek

Data source #7

Data source type
Research Paper / Policy Report
File
Date
2007-06-20
Comment on data source
Castor plant starts in Ethiopia - Long-term lease agreement closed - Environmental and social aspects are key

Data source #8

Data source type
Research Paper / Policy Report
File
Date
2010-01-01
Comment on data source
"Africa: up for grabs : The scale and impact of land grabbing for agrofuels" by FRIENDS OF THE EARTH AFRICA AND FRIENDS OF THE EARTH EUROPE

Data source #9

Data source type
Company sources
File
Date
2008-01-01

Data source #10

Data source type
Research Paper / Policy Report
File
Comment on data source
The role of foreign investment in Ethiopias smallholder farmer focussed .... By Tom Lavers

Data source #11

Data source type
Research Paper / Policy Report
File
Date
2014-11-03
Comment on data source
Commercial Farms in Africa- from Ward.

Data source #12

Data source type
Research Paper / Policy Report
File
Comment on data source
Les entreprises françaises impliquées dans l’acquisition et la gestion de grands domaines agricoles et plantations à l’international

Data source #13

Data source type
Government sources
File

Data source #14

Data source type
Media report
File
Comment on data source
Profile of Acazis in Boersenzeitung

Data source #15

Data source type
Company sources
File
Date
2013-04-30
Comment on data source
Q1 report Acazis AG

Data source #16

Data source type
Media report
File
Date
2017-09-27
Comment on data source
Farmland Grab (article originally from INDIAN OCEAN NEWSLETTER ISSUE 1458). "Game over for Flora EcoPower".

Data source #17

Data source type
Research Paper / Policy Report
File
Publication title
Alarm Bell for Biofuel Development in Ethiopia
Date
2020-01-03
Comment on data source
The Chapter in the Book "Agrofuel Development in Ethiopia: Rhetoric, Reality and Recommendations. Alarm Bell for Biofuel Development in Ethiopia: The Case of Babille Elephant Sanctuary

Promised benefits for local communities

Promised benefits for local communities
Health
Education
Capacity Building
Other
Comment on promised benefits for local communities
drinking water

Former land owner (not by constitution)

Former land owner
Community

Former land use

Former land use
Smallholder agriculture
Forestry
Conservation
Comment on former land use
The area the company acquired was the cause of local and international clamour from environmentalists, given that over 80 per cent the land was part of the Babile Elephant Sanctuary that was established 40 years ago. The area is also a sanctuary for various types of other wild animals including lions, leopards, etc. Despite the controversy, the investment was supported by the regional and federal government, and was even the proud host of Ethiopian Prime Minister Meles Zenawi in early 2007.

Former land cover

Former land cover
Cropland
Forest land
Comment on former land cover
The clearing of the forest and bush land will cause severe environmental damage which will result in loss of biodiversity, and land degradation due to inevitable soil erosion with increased runoff.

Detailed crop, animal and mineral information

Crops area
Peanut (groundnut)

Use of produce

Has domestic use
Yes

In country processing of produce

In country processing of produce
Yes
Comment on in country processing of produce
AGF (Agrofuel production);OIL (Oil Production (in general Cosmetics and pharmaceutical production), Food. The company built an oilseed crushing plant in Fechatu. In 2012 Acazis signed a contract with the company Ethiopian K & S, which would manage its factory for 3 years for a fee of 10 000 US dollars monthly.

Overall comment

Overall comment
formerly Flora Ecopower Holding. Major restructuring of the company after operations failed in 2008/09

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Feb. 15, 2013, 5:01 p.m.

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