London- and Toronto-listed gold producer Centamin says the framework for the model mining exploitation agreement (MMEA) has been agreed in principle with the Egyptian Ministry of Petroleum & Natural Resources (MoP) and the Egyptian Mineral Resources Authority (Emra).
The MMEA sets out the legal and fiscal framework that will apply to commercial discoveries made on the highly prospective 3 000 km2 of ground awarded to Centamin in 2021 for exploration in the Eastern Desert of Egypt (the EDX blocks).
Alongside industry partners, Centamin CEO Martin Horgan and the Egyptian Minister of Petroleum & Natural Resources Eng Tarek El-Molla, have jointly reached an agreement in principle on the fiscal and regulatory terms associated with the exploitation phase of new mining projects in Egypt.
Following routine Egyptian government and legal procedures, the MMEA will be ratified as a Special Law by Egypt later this year.
“Centamin has successfully operated in Egypt for over 20 years and we believe these terms lay the foundation for developing Egypt’s mining sector, unlocking the undoubted geological potential within the country.
"The 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," Horgan comments.
The MMEA applies to Centamin’s three EDX blocks – Nugrus, Um Rus and Najd – and will take effect once the Egyptian Parliamentary approval is granted and legally ratified.
Under the terms of the MMEA, exploitation licences will be issued for a 30-year stabilised fiscal and legal regime, which includes a 5% government net smelter royalty on revenue; a 22.5% corporate tax rate; a 15% government financial net profit interest; a 0.5% community development contribution; and life-of-mine commitments towards local employment, training and procurement.
The MMEA does not apply to the 160 km2 Sukari Gold Mine mining concession. Centamin's flagship Sukari mine, in Egypt, has been in production for more than a decade and produced 440 970 oz of gold in 2022.