Egypt forecasts new gold deposit will attract $1bn in investment over 10 years

THE Egyptian government estimated $1bn would be invested developing a gold deposit in the southeast of the country, according to a report by Reuters.

The deposit currently contains about one million ounces and lies in the concession area of the military-controlled Shalateen Mining Company in the Iqaat area of the Eastern Desert, said Reuters.

Egypt has been seeking to attract investors to its mining sector and in March began an auction of 56,000 square kilometres of exploration concessions in the Eastern Desert. It recently extended the auction’s original July deadline to September 15 as a result of the COVID-19 crisis “… and to have an opportunity for the bidders”, said Reuters.

A new company will be formed between Shalateen Mining Company and the state regulator, the Egyptian Mineral Resources Authority, to develop the deposit.

Naguib Sawiris, the Egyptian billionaire-turned-gold bull, was said in February to be holding talks to buy a 51% stake in Shalateen. Sawiris chairs private gold mining group La Mancha which is the major shareholder in Centamin, the UK-listed gold producer.

Sawiris said previously that he intended to invest in gold and copper mining in Egypt if investment conditions improved.

Egypt in January issued new regulations that appeared to eliminate the need for mining companies to form joint ventures with the government and to limit state royalties to a maximum 20%.

Ramping up gold output would be a future source of growth for the Egyptian economy, which is emerging from a sweeping International Monetary Fund-backed reform program.