Egypt issues new mining law regulations

Author: 
Reuters
ID: 
1579111906589379600
Wed, 2020-01-15 16:36

CAIRO: Egypt issued new regulations that appear to eliminate the
need for mining companies to form joint ventures with the Egyptian
government and to limit state royalties to a maximum 20%, measures
long advocated by the private sector.
The cabinet released a summary of the executive regulations to the
mining law after its weekly meeting on Wednesday. The law itself
was issued in August.
Mining companies have long complained that Egypt’s system of
mandatory joint ventures, stiff royalties and profit sharing
agreements have made it unprofitable to explore for and exploit
minerals.
Egypt is hoping a change in rules might lead to a bonanza in gold
production. Neighbouring Sudan produced an estimated 93 tons of
gold in 2018, which according to the US Geological Survey made it
Africa’s third biggest producer.
The cabinet statement indicated that although the Egyptian Mineral
Resources Authority had the right to form joint ventures with a
minimum state ownership of 25%, private mining companies would not
necessarily have to do this if their mining agreements were
ratified by law.
The statement also said mining companies would have to pay a rental
value for their mines and quarries as well as royalties at a
separate rate determined for each type of ore extracted.
“The royalty will not be less than 5% or exceed 20% of ore
produced each year by the licensee,” the cabinet statement
said.
Private mining executives said they were waiting for a copy of the
actual regulations, but if the requirement for joint ventures had
indeed been eliminated Egypt could well see huge interest by
exploration companies.
“That is the highlight of the new regulations, something we have
been chasing for a decade,” one executive said, asking not to be
named.

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Source: FS – All-News-Economy
Egypt issues new mining law regulations