The Ministry of Energy and Minerals and Minerals Development Oman (MDO), an affiliate of Oman Investment Authority (OIA), signed on Wednesday a total of 12 exploration-to-mining concession agreements in the largest such mining-related concession awards.
The agreements were signed by Dr Mohammed bin Hamad al Rumhy, Minister of Energy and Minerals, and Dr Bader al Kharousi, Chairman of Minerals Development Oman.
The total size of the concession areas included in the agreements is around 21,480 square kilometres/km2. They include a number of potential minerals, mainly strategic minerals (metallic) such as Copper, Gold and Chromium. The agreements cover eight sites mostly located in Al Batinah North and South, Al Dhahirah, Al Buraimi, Al Dakhiliyah and Al Sharqiyah North and South. All are exploration-to-mining concession areas. One site located in the Wilayat of Yanqul with an area size of 20 square kilometres/km2 is a copper concession area that reached an advanced exploration phase to be ready for mining.
The landmark pacts coincide with the Ministry’s adoption of a new strategy to develop the minerals sector through concession agreements including legal, technical and financial terms to be signed between the Ministry and investors as an investment management method to lead the mechanism of managing the exploited minerals identified in concession areas.
Dr Al Rumhy stated that the Ministry is working towards the development and management of minerals in an effective and professional manner that aligns with the government’s aspirations to tap the sector in support of its economic diversification strategy. To this end, the Ministry has adopted a new methodology to develop this sector by creating mining concessions covering large areas similar to the methodology currently in vogue in the Oil and Gas sector. These areas will be offered to local and international companies specialised in exploration and minerals extraction against an Exploration and Mining Concession Agreement (EMCA). The agreements are underpinned by committee to support in country value (ICV) development in mineral ores in the Sultanate of Oman and the establishment of downstream mining and manufacturing industries, in addition to creating more job opportunities.
Commenting on the agreements, MDO’s Dr Bader al Kharousi said: “By signing these agreements, we mark a significant milestone for MDO’s future. MDO has a promising aspirations to invest in exploration activities across Oman targeting several strategic commodities and we hope that the promising results of these exploration activities will be a solid cornerstone to attract strategic investors and ultimately promote the entire Omani mining sector, in collaboration with our esteemed partner, the Ministry of Energy and Minerals.”
He added that these agreements are a starting point for exploration and evaluation of the current and new mineral resources. MDO plans will commence by launching an ambitious programme of Airborne Geophysical Survey will be followed by geochemical studies, aiming at identifying the potential of several minerals in these areas. Moreover, these concessions will enable mining and exploitation of resources especially copper in Wilayat of Yanqul and industrial minerals in Wilayat of Shaleem.
The industrial minerals (non-metallic) included in the agreements are Dolomite, Silica, Gypsum, and Limestone in the four other areas located in the governorates of Muscat and Dhofar. Three of them are concession areas that have reached an advanced exploration phase and are ready for mining. Covering a total area of 1,489 sq km in Shaleem, they include ores like Dolomite, Limestone and Gypsum.
The Ministry, by identifying the concession areas in minerals sector, aims to overcome the challenges facing the licensing mechanism (which is limited now to public sites only), through the following objectives:
• Contributing in creating an integrated database includes geological, geophysical and exploration surveys that cover most of the Sultanate of Oman in order to create an organised and sustainable source of mining opportunities in Oman where the investor can explore all the minerals available in the concession areas.
• The concessions include all the terms related to the competent government entities such as environmental conditions, which will enable investors to obtain theses approvals from these entities to smoothly move from exploration to mining phase.
• Providing the required size and quantities of the primary metallic ores so it can be commercially invested in the minerals processing operation to increase the concentration levels and consequently increase its market value. These quantities of minerals reserves will facilitate the creation of in country value to the mineral ores available in the Oman through establishing downstream mining and manufacturing industries.
• Facilitating funding from the bank sector for investment in mining sector through developing a long-term agreement with the investor.
• Focusing Ministry efforts resources in the high strategic minerals (metallic minerals) especially the ones related to Fourth Industrial Revolution, while enhancing industrial mineral production (non-metallic minerals) through attracting international specialised companies and enable the establishment of mining industries and creating various job opportunities.
The Ministry is also working towards regulating investment in the mining sector to insure the optimal utilisation of the mineral reserves locally, by creating a mechanism to ensure the sector’s sustainability. By offering ‘Ready for Investment’ mining opportunities based on concession areas, the Ministry hopes it will help in the development of an investment portfolio and organised sector, in addition to reducing the environmental impact.
