With more than $20 billion at a single mine, and 100 unexploited gold mine sites, Egypt is sitting on a proverbial gold mine.
Speaking to Al Sherouk yesterday, Sukari Gold Mining Company chairman Ali Barakat stated that the gold mine holds an estimated 14.5 million ounces of gold which is worth upwards of $20 billion, which could have major implications on investor interest in Egypt's mineral sector. Barakat continued that $2.7 billion worth of gold was produced from Sukari since January 2010 and that production was set to increase, coming at a time when the government could make the most from it.
At the same time, Oil Minister Tarek El Molla is in Canada today to participate in the Prospectors and Development Association of Canada mining convention to promote Egyptian Mineral Resources Authority (EMRA)'s gold exploration in Sinai and the Eastern Desert. There has been some concern from investors over the government’s insistence on a 50-50 profit sharing deal. However, El Molla dismissed them, stating that the Egyptian gold concessions are a sure bet for investors after a map from ancient Egypt showed the locations of all the major goldmines in the country, Sukari among them.
Nationally, EMRA expects gold extraction to take place at 100 sites across the country in 2017. London-based research firm BMI estimated that Egypt’s mining sector is expected to increase by 6% from now till 2021.
In October, Centamin recovered the $1 billion cost of the mine and has begun paying 40 percent of profit to the government, which will continue until 2019, followed by a 55/45 split, and finally an even 50/50 after an additional two years, set to begin in 2021. Centamin profited greatly from the concession, stating 2016 was a "bumper year" in Egypt after the company nearly lost everything following the 2011 revolt.
The value of gold is expected to continue its rise due to political and economic instability with the election of Donald Trump, further Quantitative Easing in the EU, and the UK’s departure from the Euro has made the Dollar, Euro, and the British Pound no longer seem as safe currencies for international investors.