The Egyptian Ministry of Petroleum and Natural Resources and the Egyptian Mineral Resources Authority (“EMRA”) launched the first international bid round in mid-March 2020 for the exploration of gold and related minerals. The round was expected to close on 15 July 2020, but given the impact of COVID-19, the bid currently extends to 15 September 2020. As stated in the bid announcement, EMRA invites international companies specialized in gold and associated minerals exploration to participate in the international bid round no.1/2020, in relation to some sectors in the Eastern Desert (area under EMRA’s Authority) in Egypt.
Since 2014, the Egyptian Government has started the process of modernising the petroleum and natural resources sector. The initial focus was on oil and gas with the issuance of the new natural gas law in 2017 and its amendment in 2019. Soon to follow, the mining legislation was amended in 2019 and the executive regulations were issued in January 2020.
While the Mining Law no. 198 of 2014 had already brought a major change in the mining legal framework by breaking away from the production sharing agreement regime to a rent, royalty and taxation regime, it lacked detailed information about the fiscal regime and the licensing process. The Amendment no. 145 of 2019 together with the Executive Regulations no. 108 of 2020 highlight a trend to decentralise licensing powers and offer more detailed information on the fiscal regime and the licensing process.
It does not come as a surprise that, following the issuance of the Amendment and the Executive Regulations, international investors have expressed a clear interest in the Egyptian mining sector.