The off-road tracks
deep in Egypt's eastern desert, prospectors are ramping up the hunt for the
treasure once revered by the Pharaohs as the "skin of the gods" —
gold.
Essential for ancient
artifacts like the famed burial mask of Tutankhamun and still highly desired in
Middle Eastern culture today, gold has been mined in Egypt for millennia. But
experts say the country is heavily underexplored and that modern technology now
allows much deeper excavation of the ancient sites shown on Pharaonic treasure
maps.
If developed, gold and
mineral mining could prove a boon to the country at a time it is desperate for
foreign currency, and provide jobs for its burgeoning population of 90 million.
But miners and experts say current legislation is out of step with global
practices and doesn't give enough incentives to bring in foreign investment.http://fuck-dolls.tk
"Mining has been
going on here for over 5,000 years, but in the 21st century it's essentially
virgin ground," said Mark Campbell, president of the Canadian exploration
company Alexander Nubia, which is increasing its drilling this year in a
1,070-square mile area in the desert. "Exploring for gold and minerals in
Egypt today with modern technology is like having a map where X marks the
spot."
The group has
identified six potential mines in the area, filled with barren valleys and pink
rock outcroppings known as the Arabian-Nubian Shield, which stretches south to
Eritrea and east to Saudi Arabia. While veins close to the surface have been
largely excavated by successive Pharaonic, Roman and even British colonial
operations, the sites still hold gold concentrations deeper down that nowadays
can be extracted with heavy machinery.
At the moment, Campbell's
team is drilling core samples that are sent off for analysis in Romania. The
gold can't always be seen by the naked eye, with concentrations of only a few
grams per ton of dense, mineral-filled ore. But it's promising enough for the
team of two dozen explorers and specialists to have undertaken plans to open
Egypt's first new mine by 2019.
One former British
colonial-era mine in the area, known as Abu Zawal, was abandoned in the
mid-20th century after nationalist strongman President Gamal Abdel Nasser
chased away foreigners and ended decades of laissez-faire capitalism in the
Arab world's most populous country. The British also had been following in the
tracks of the ancients — the site is still littered with Roman pottery
fragments, an ancient fort and water well, as well as Pharaonic grinding stones
that lie scattered alongside turn-of-the-century spent rifle cartridges.
But the mining sector
today remains largely dormant, a victim of outdated policies, experts said.
Despite some reforms that went into effect last year amid government promises
to create more favorable investment laws, Egypt's mining legislation still
falls short of international standards, and attempts by the government to
attract foreign investment have largely failed.
"No one wants to
deal with the profit-sharing structure," said Yousef Husseini, an analyst
at Egyptian bank EFG Hermes who follows the mining sector.
"The ideal setup
would be royalty and taxes as opposed to royalty and profit share, as is
currently the case," he said, referring to the current system where mining
companies in Egypt must pay at least half of their profits to the state in
addition to royalties paid annually based on sales figures. In most other
countries, taxes levied on companies in the mining sector range from 25 to 50
percent.
Mark Tyler, an
investment banker with Nedbank in London, agrees that the current split of
profits demanded by Egypt is out of step with global practices. Mines are both
expensive to build and to operate throughout their lifespans, unlike oil and
gas discoveries that run relatively cheaply after the initial investments.
"There's a long
history of small-scale mining in Egypt. Generally that's a good indication
there are minerals in the area," Tyler said. "But those rules are
pretty harsh. Typically you have royalties and taxes and some type of state
shareholding in the company, like is often the case in West Africa and the rest
of the world."
The exception is the
Sukari mine, Egypt's only modern mining operation, which has consistently
increased its profits in recent years. Built over another ancient gold mining
site further to the south, the company that runs it, Centamin, has seen its
share price grow by over 60 percent since the beginning of the year, buoyed by
rising gold prices and a 15.7 percent increase in production in the first
quarter compared to last year.
The company has a
special deal that was approved by parliament during the rule of Hosni Mubarak,
Egypt's long-time strongman who was ousted in a popular uprising in 2011. Its
success was briefly halted the following year, when the country was under the
rule of the elected but divisive Islamist, Mohammed Morsi, and a court decreed
that Centamin's right to operate Sukari was invalid.
But since
general-turned-president Abdel-Fattah el-Sissi led Morsi's overthrow in 2013,
promising a business-friendly government that would protect and streamline
investments, Centamin has regained confidence. Its license was upheld briefly
before Morsi's ouster, although the case is still facing appeal with a decision
due in late May. The company believes it is in a good position, given more
recent legislation that bolsters property rights.
Under el-Sissi, the
government has talked of creating a "Golden Triangle" of development
in the area, one of its favored "mega projects" to spark the fast
economic growth needed to provide jobs. But like investment law reforms
announced in 2015, that plan has so far fallen short, with investors still
regularly complaining of endless red tape when doing business in Egypt.
Still, the players
involved in mining today are decidedly upbeat. Both Campbell and Centamin's
chairman, Josef El-Raghy, envision a future where new mines could sprout up all
over Egypt.
"If there were
more favorable legislation, there'd be dozens of companies all around the
area," said geologist Leonard Karr, an American with Campbell's company
who has worked for 36 years in the industry, as he enthusiastically pointed out
rock formations during a jeep tour of the area.
As Campbell, who has
overseen mining and oil drilling in a dozen or more countries over the years,
put it: "Egypt is a geological Disneyland."
