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Resolute Mining explores like an Egyptian

Resolute Mining explores like an Egyptian

Fri July 07 2017


Perth-based gold producer Resolute Mining will follow in the footsteps of the pharaohs as it becomes one of the few Western companies with exploration ground in Egypt.


Resolute yesterday said it had been awarded two licences east of Luxor, both of which were home to extensive artisanal goldmining more than 2000 years ago.


The company aims to identify the source of those ancient workings in the hope of replicating the success of London-listed (and formerly ASX-listed) Centamin, which owns the huge ­Sukari goldmine nearby.


But the latest exploration ­effort carries a high degree of legislative uncertainty, with the current framework in Egypt not conducive to supporting the development of new goldmines in the country. Instead, Resolute plans to talk to the government about alternative tax and royalty arrangements that would help it get any future gold discovery off the ground.


“There’s a reason they built all those pyramids; it was to hide all their gold in,” Resolute managing director John Welborn told The Australian.


“But it doesn’t look like anyone’s gone back to those mines since they built them, with the exception of Centamin.”


The vast amount of ancient Egyptian gold artefacts is testament to the mineral potential of the country, but it has been largely off the radar for gold explorers due to the production sharing agreement fiscal terms that govern the sector.


Centamin pointedly abstained from bidding for new exploration licences under the recent process, noting that its ­Sukari operation would not have gone ahead if it was subject to the current fiscal regime.


Mr Welborn acknowledged that the entry into Egypt did come with significant challenges but said he was optimistic the company could replicate the success it has had in coming to agreements with other governments elsewhere in Africa.


“The interests of the region are not going to be advanced unless there are mines,” he said.


Resolute currently operates the Syama goldmine in Mali and the Ravenswood mine in Queensland. The company was expected to produce about 325,000 ounces of gold in the 2017 financial year.


Source: http://www.theaustralian.com.au/