Egypt hits the jackpot with the discovery of a large gold deposit
Stake: For Egypt, to increase its gold production capacity in a favourable economic context.
A modest gold producer, Egypt could soon see its industry strengthened. The Egyptian Minister of Petroleum and Mining Resources, Tarek El-Molla, announced on Tuesday 30 June the discovery of a major deposit in the south-east of the country.
According to the first information made public, the updated reserves would be more than one million ounces, or nearly 30 tonnes. Better yet, it was the national mining company, Shalateen Mining, that identified the deposit in an area it is mining, the minister said in a news release. In any case, the announcement comes in a particularly favourable context: with the crisis linked to the Covid-19 pandemic and its « safe haven » status, the price of the yellow metal is at its highest level in nine years (close to $1,800 per ounce), which mechanically increases the profitability of gold projects. In addition, Egypt has published a series of new mining regulations in 2019, with the aim of attracting new investments in this sector. A process that already seems to be bearing its first fruits: in the wake of these new regulations, Canada’s Aton Resources became this year the second foreign company to obtain a mining and exploration licence, after the Australian-British company Centamin, which has been active in the country since 1995. As for the investment required to develop the new deposit, the Ministry of Petroleum and Mineral Resources estimates that it could reach $1 billion over the next decade.
This could, in time, significantly increase the North African country’s gold production, which remains low (less than 15 tonnes of yellow metal produced in 2019) compared to the continent’s heavyweights Ghana (158 tonnes), Sudan (127 tonnes) and South Africa (119 tonnes). At present, Egyptian gold production is concentrated in three sites, located in the eastern desert (south-east of the country): Sukari, Hamash and Wadi al-Alaqi.
Evolution of Egyptian gold production (2010-2019, production in tons).
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