Mining firms see little appeal in Egypt's gold exploration terms

CAIRO -- The gold beneath Egypt's desert could make it a top global producer, but the investment terms on offer are driving away small explorers whose skills the country needs to unlock its mineral wealth.

The Egyptian government launched its first international tender for gold mining concessions in eight years last week, potentially an exciting opportunity for global miners to help develop a relatively untapped gold-mining frontier.

Though it has a history of gold-mining stretching back to the pharaohs, Egypt today has a single commercial gold mine, Centamin's Sukari, which produced 551,036 ounces last year.

In Egypt's mineral-rich Eastern Desert alone, some exploration companies estimate potential gold reserves could be higher than 300 tonnes, although the government declines to give an estimate.

But mining companies active in Egypt and Africa say the new exploration round, which offers five concession areas and closes on April 20, is unlikely to lure investors because of commercial terms they say are among the least attractive in the world.

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http://www.reuters.com/article/us-egypt-gold-idUSKBN158263