Egypt Seeks Midas Touch With New Gold-Mining Exploration Tender
Egypt Seeks Midas Touch With New Gold-Mining Exploration Tender
(Bloomberg) -- Egypt announced a new exploration tender for gold-mining, offering international companies a chance to bid on blocks in the eastern desert after revamping regulations that drew complaints from investors.
The first bid round since 2017 will be held from March 15 to July 15, with subsequent ones taking place every four months, the Oil Ministry said Tuesday. The blocks will be administered under a free carry, tax and royalty scheme, with royalties capped at 20%.
The mining law was changed “after we found it hindered investors,” Oil Minister Tarek El-Molla said while announcing the tender, which he described as having been met with excitement by businessmen both at home and abroad. “We switched to a tax and royalty system to replace the production-sharing system.”
The alterations in legislation are part of a broader push by Egypt to revive its economy and tap new sources of revenue. After a three-year International Monetary Fund-backed program that saw the currency devalued and cuts in spending in subsidies, the latest phase is focused on building sustainable growth by boosting the private sector and finding new income.
Under the new regulations, companies are no longer obliged to form joint ventures with the government.
The government is planning a roadshow in Canada next month to drum up more interest, according to El-Molla. It’s currently in talks with Egyptian billionaire Naguib Sawiris regarding his possible purchase of a stake in Shalateen, a state-run mining company, the minister said.
To contact the reporter on this story: Salma El Wardany in Cairo at selwardany@bloomberg.net
To contact the editors responsible for this story: Nayla Razzouk at nrazzouk2@bloomberg.net, Tarek El-Tablawy, Michael Gunn
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