Centamin, Egyptian Ministry of Petroleum set to bolster mining sector with new agreement
In a significant development for the mining industry in Egypt, Centamin has announced that the Model Mining Exploitation Agreement (MMEA) framework has been agreed in principle with the Egyptian Ministry of Petroleum & Natural Resources (MoP) and the Egyptian Mineral Resources Authority (EMRA).
This agreement pertains to the commercial discoveries made on the promising approximately 3,000km2 ground granted to Centamin in 2021 for exploration in Egypt’s Eastern Desert (EDX blocks).
Centamin CEO Martin Horgan and the Egyptian Minister of Petroleum & Natural Resources, Tarek El-Molla, together with industry partners, have negotiated the fiscal and regulatory terms related to the exploitation phase of new mining projects in Egypt. Pending standard Egyptian government and legal procedures, the MMEA will be ratified as a Special Law by the Arab Republic of Egypt in late 2023.
Both Centamin and the MoP share the vision to establish a flourishing mining sector that benefits Egypt and its citizens. Through employment, education, and training, as well as direct financial and infrastructure investment, mining could contribute up to 5% of the country’s GDP by 2030. The MMEA serves as a pivotal regulatory and fiscal framework that balances the risk and reward between stakeholders, while providing a stable operating environment for the international mining community and its investors.
“MMEA provides a clear regulatory and fiscal framework that fairly balances risk and reward between the stakeholders while providing a stable operating environment required by the international mining community and its investors,” Martin Horgan, CEO of Centamin, stated, praising the agreement as a milestone for Egypt.
The MMEA, once legally ratified following Egyptian parliamentary approval, will apply to Centamin’s three EDX blocks (Nugrus, Um Rus and Najd).
The agreement outlines a 30-year stabilised fiscal and legal regime that includes government net smelter royalty, corporate tax rate, government financial net profit interest, community development contribution, and life of mine commitments towards local employment, training, and procurement. Notably, the MMEA does not apply to the 160km2 Sukari Gold Mine mining concession, which operates independently under the Sukari Concession Agreement.