Mining

Minerals come into focus as Egypt wrestles with oil reforms

November 8, 2024, 2:37 PM

Egypt minerals — Crushed core samples are placed into sacks for mineral concentration analysis in Egypt's Eastern Desert: the Western Desert remains largely unexploited

Deposits include gold
Western Desert untapped
Energy sector undergoing reforms

Egypt’s proposed platform to encourage investment into their minerals sector is likely to launch early next year, the minister of petroleum and mineral resources said this week.

The so-called Mining Portal, which was originally scheduled to be operational by the end of 2024, is part of a drive to exploit what the government says is untapped commodities wealth.

The country can provide critical minerals that are “fundamental for all technologies needed for the energy transition”, Karim Badawi said at the Adipec energy conference in Abu Dhabi this week.

Egypt has deposits of minerals including gold, copper, uranium, silver, zinc, platinum, titanium, phosphate and iron ore in the Eastern and Western Deserts and the Alaqa Valley in the far south of the country.

The country plans to launch the website early in the first quarter of 2025, Badawi said.

While the Eastern Desert has been explored, the Western Desert remains untapped. If developed, the mining sector has the potential to earn more than hydrocarbons, reports have suggested.

Badawi said that mining contributes less than 1 percent of Egypt’s GDP but has the potential to grow to 5 percent over the next few years “easily”.

However, for nearly 60 years, Egypt has focused on oil and gas, while the mineral sector has been ignored. The minerals sector “is gaining a lot of importance, and rightly so,” Badawi said.

The investment portal is intended to be similar to the one created for upstream oil and gas, the Egypt Upstream Gateway (EUG).

EUG is an integrated online platform which gathers data about the subsurface of the oil and gas sector, including new plays and prospects, to “enable the world to evaluate investment opportunities”, Badawi said.

Egypt’s petroleum minister is striving to revitalise the country’s ailing oil and gas industry.

A government report last month said Egypt’s extraction sector contracted by nearly 5 percent in 2023-2024, primarily because of reduced oil and gas production, due to a “decline in foreign investments, in new well discoveries, as well as a slowdown in the development and enhancement of existing wells”.

Reforms

As a result, Egypt has become unable to meet its growing energy demand.

The decay is partially attributed to overdue payments to international oil companies. Egypt has been reimbursing investors gradually as it received funds from the IMF and Gulf investors.

Since the establishment of the new government, the Egyptian oil and gas sector has been undergoing significant reforms, Badawi said.

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“Over the last few months, we’ve been working on introducing a reform in oil and gas which provides flexibility to our partners, whether it is looking at the price of gas, different fiscal regimes or providing incentives for incremental production,” he said.

Egypt plans to drill nearly 600 exploratory oil and gas wells, with a total investment of more than $7 billion, by 2030.

“We are actively collaborating with our partners to foster an environment that encourages expanded production from fields and enhances exploration,” Badawi said.