A report prepared by “Reuters” agency revealed that mining companies that have obtained concessions in areas in the eastern desert of Egypt are ready to start exploring for gold.
According to the report, these companies will explore under a legislative reform that ultimately seeks to benefit from huge untapped mineral resources.
The report pointed out that despite the abundant reserves and rich mining history that resulted in finely detailed Pharaonic gold jewelery, Egypt is the only commercial mine producing gold, and foreign investment in oil and gas is growing, but mining is weakening.
He continued, “The country is counting on attracting attention on the rise in gold prices and amending mining laws that eliminate bureaucracy and the profit-sharing rule, which is not accepted in the sector.”
Egypt has so far concluded five contracts to explore for the yellow metal in its first round and has kept the bidding system active as it seeks to build momentum.
The Egyptian government is looking forward to attracting annual investments of one billion dollars into the mining sector, a goal that sector sources say may be within reach.
“Success will ultimately be measured by the number of mines that will be discovered and developed for production,” said Patrick Barnes, head of mineral and mining consulting for Europe, the Middle East, Africa, Russia and the Caspian Sea at Wood Mackenzie, which advises the Egyptian government on mining law reforms.
He continued, “Early indications reveal that the bidding round was much better than the rounds that were held in the past.”
In November, Egypt laid 82 exploration blocks on what mineral analysts said was a healthy mix of 11 companies, ranging from small exploration companies to giant companies in the sector such as Barrick Gold, and the proposed areas are located in the geological formation of the Arab Nubian Shield, which borders the Red Sea and is believed to be among the The most mineral-rich regions in the world.
The UK-based Altus Strategies told Reuters it was looking forward to building its technical team, conducting remote sensing operations and mapping out operations on the 1,500 square kilometers of land it was laid on before exploration began.
A spokeswoman for Canada-based BT Gold, which also won a concession, said that the company is looking to start exploration soon, “due to the relative lack of investment in modern exploration, and thus the presence of untapped potentials in the historically hoped-for Arab-Nubian Shield.”
Mining companies welcomed the abolition of the requirement to establish joint ventures with the Egyptian government, and the curbing of government fees to a ceiling of 20 percent.