{"id":18434,"date":"2024-09-22T17:28:03","date_gmt":"2024-09-22T15:28:03","guid":{"rendered":"https:\/\/zawia3.com\/?p=18434"},"modified":"2026-10-09T00:20:07","modified_gmt":"2026-10-08T22:20:07","slug":"sukari-mine","status":"publish","type":"post","link":"https:\/\/zawia3.com\/en\/sukari-mine\/","title":{"rendered":"By the Letter of the Law: Will Egypt’s Rights Be Affected After the Sukari Mine Acquisition Deal?"},"content":{"rendered":"

On 10 September, “AngloGold Ashanti” announced its acquisition<\/a> of “Centamin”, the operator of the Sukari mine, for about USD 2.5 billion. The move comes as gold prices rise globally, as the company seeks to strengthen its presence in Egypt after selling its assets in South Africa. Under the deal, Centamin shareholders will receive 16.4% of the new company’s capital, while AngloGold will own 83.6%. The deal raises questions about Egypt’s share of the revenues and its impact on the local economy.<\/p>\n

Through its acquisition of the Sukari mine, AngloGold seeks to improve<\/a> production, which stands at about 450,000 ounces a year, with plans to expand exploration operations and develop new areas within the concession surrounding the mine. This step is part of the company’s strategy to expand its operations outside South Africa after selling its assets there, which strengthens its presence in Egypt and contributes to developing the mining sector in the region.<\/p>\n

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“AngloGold Ashanti” is one of the largest gold producers in the world, headquartered in Denver in the United States, with roots in South Africa. The company was founded in 2004 following the merger of “AngloGold” and “Ashanti Goldfields”, and currently manages large gold exploration assets in Africa, Australia, the Americas and now Egypt, after its acquisition of “Centamin”. This acquisition helps strengthen the company’s presence in the Egyptian gold market.<\/p>\n<\/blockquote>\n

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The Importance of the Sukari Mine<\/h3>\n

The Sukari<\/a> mine is the largest gold mine in Egypt and one of the largest producing mines in the world. Since it began actual production in 2009, the mine has become an important source of economic revenue, contributing to national income and providing foreign currency. With the recent deal to sell Centamin, questions have been raised about the future of Egypt’s share of this important resource, amid fears that the state’s share of the revenues will be reduced.<\/p>\n

The Sukari mine is located in the Eastern Desert, about 30 kilometres from the city of Marsa Alam, and its history dates back to ancient Egyptian times. It was reopened in 1994 following an agreement between the Egyptian authority and Pharaoh Gold Mines, and it is one of the main pillars of the Egyptian mining sector.<\/p>\n

The Sukari mine’s production life extends to 28<\/a> years, twice the average life of mines in Africa, placing it among the 25 largest mines in the world. About 4,500 people work at the mine, in addition to 1,000 suppliers and 50 contracting companies, which strengthens its role in supporting the Egyptian economy.<\/p>\n

In 2023<\/a>, the Sukari mine achieved revenues of about USD 850 million. Under the agreement between Centamin and the Egyptian government, the state receives 50% of the mine’s profits in addition to a 3% royalty based on net sales. The mine produces between 470,000 and 500,000 ounces of gold annually, making it a vital source of foreign currency and national income. The mine is managed according to the latest technical and environmental standards, which strengthens its status as a world-class mine not only in terms of production volume but also in applying sustainability and environmental conservation standards.<\/p>\n

The large reserves the mine still contains make it a major attraction for foreign investment in the Egyptian mining sector. This highlights the mine’s strategic and economic importance, especially in light of the government’s plans to expand mining activity in the coming years. In 2023, the mine’s cash contribution reached USD 121 million, while the Egyptian government received USD 139 million from the mine’s profits and royalties.<\/p>\n

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Since production began in 2009, the mine has produced about 5.7 million ounces of gold, while Centamin continued to expand the scope of exploration, as drilling campaigns showed promising results at new sites in the Eastern Desert, and the new company is expected to continue these activities.<\/p>\n<\/blockquote>\n

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Evaluation Before the Acquisition<\/h3>\n

Gamal El-Qalyoubi<\/strong>, professor of petroleum and energy engineering and board member of the Petroleum Society, says that “AngloGold Ashanti” carried out a comprehensive and detailed evaluation before acquiring “Centamin”. The evaluation covered technical, commercial and legal aspects to ensure the soundness of the deal. He also stressed that the acquisition will not affect the Egyptian state’s rights in the Sukari mine, and that the existing agreement on exploitation rights will remain in force without amendment.<\/p>\n

He points out, speaking to Zawia3, that “AngloGold Ashanti” considers the Sukari mine area and its surroundings promising, with the possibility of new discoveries, based on studies it conducted according to international standards. He adds that the company believes the deal will strengthen its financial and operational performance, in light of the major upgrades the Egyptian mining sector has recently seen.<\/p>\n

The board member of the Petroleum Society also explains that the agreement stipulates profit sharing between the Egyptian government and “Centamin” at 50% for each party, in addition to Egypt receiving a royalty of up to 3% of net revenues from gold sales. This agreement prevents any change in Egypt’s share of the mine, which will remain as it is, meaning that any increase in investments would raise Egypt’s revenues from the mine.<\/p>\n

Recommended reading:<\/strong> The New Government Between Pleasing Creditors and the Standard of Loyalty and Obedience<\/a><\/p>\n

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Legal Experts Warn<\/h3>\n

An international law expert stated that Prime Minister Mostafa Madbouly made an inaccurate statement that the sale of the stake of the Australian company “Centamin” to the South African company “AngloGold Ashanti” does not require Egypt’s approval, and that the sale and purchase took place between the companies holding the concession for the Sukari mine under the same previous conditions. The expert indicated that this statement may raise concern about Egypt losing the opportunity to reassess or review the conditions relating to the Sukari mine concessions, and that the government should take this matter seriously.<\/p>\n

The international law expert continues that all concession rights and investments concluded with foreign states and companies, including Emirati and other companies, are supposed to be subject to close oversight: if the original company sells its stake in its country, it must obtain written approval from Cairo for the contract to continue, and Cairo has the right to reject the deal or impose new conditions related to the concession. This protects Egypt and its national security from the risks of foreign or hostile companies buying in, and also constitutes an opportunity to impose new conditions and additional fees that guarantee Egypt achieves its financial interests and strengthens its oversight of concessions and rights.<\/p>\n

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The expert cites the text of Article (21<\/a>) of the gold exploration agreement for the Sukari mine, published in the Official Gazette in 1995, which stipulates that rights or concessions may not be assigned without the written approval of the Egyptian government. This contradicts the statement of the head of government, who stressed that the assignment between the two companies does not require the government’s approval, and the expert asks: has the state given up an inherent right in this deal?<\/p>\n<\/blockquote>\n

For its part, the Ministry of Petroleum explained in a statement<\/a> that the deal between the two global listed companies does not require the approval of the Egyptian government, as it covers all of Centamin’s shares and its global areas of operation.<\/p>\n

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Will Egypt’s Share Be Affected?<\/h3>\n

Responding to Zawia3’s questions about the agreement and whether it may affect Egypt’s share in the Sukari mine, or lead to the mine being sold entirely to the new company, an informed government source says that the acquisition of “Centamin”, which holds the controlling stake in the Sukari mine in Egypt, by “AngloGold Ashanti” was under negotiation several months ago, but has recently been completed.<\/p>\n

The source explains in statements to Zawia3 that the Sukari mine exploitation agreement categorically does not prevent the assignment or merger of the company holding the exploitation rights, pointing to precedents in Egypt’s oil and gas sector indicating that such changes can happen.<\/p>\n

The official adds that “AngloGold Ashanti” analysed samples and previously sent geologists to Egypt to explore the Sukari mine and its surrounding areas before completing the deal, stressing that the analysis and environmental studies showed the mine’s compatibility with the company’s global asset portfolio, which enhances the chances of improving its operational and financial performance.<\/p>\n

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The government official denies that any hidden sale took place, stressing that Egypt’s share will not be affected at all by the acquisition, and pointing out that Egypt’s share will in fact increase over time, as production is expected to be developed, which will in turn increase the mine’s output and therefore Egypt’s share, in accordance with the provisions of the concession agreement issued under Law No. (222) of 1994, which remains in force in all its clauses and governs the relationship between the shareholding parties, “the Egyptian Mineral Resources Authority and Pharaoh Gold Mines”, the latter having been acquired by Centamin, which has now assigned it to the new company.<\/p>\n<\/blockquote>\n

According to the official, in previous years some investors showed interest in acquiring the Sukari mine, but those attempts bore no fruit because of the previous owner’s insistence on continuing to invest in the mine, as it believed it could achieve more profits with investment and operating costs that suited it at the time.<\/p>\n

He points out that Centamin’s acceptance of the acquisition deal is due to its desire to invest new capital in research and exploration projects in other markets. The company has also achieved large profits over previous years, which made it more open to completing the acquisition deal at present.<\/p>\n

The official concluded his statements by stressing that Centamin was listed on the London Stock Exchange, and that the gold extracted from the Sukari mine was sold there.<\/p>\n

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The New Investor’s Relationship with the Israeli Occupation<\/h3>\n

Yahia El-Kazzaz, professor of geology at Helwan University and an opposition politician, pointed to the presence of shareholders in “AngloGold Ashanti”, which has taken over the operation of the Sukari mine, who have strong ties with the Israeli occupation. El-Kazzaz added in a post on the X platform that these shareholders have close ties with Tel Aviv and have investments in banks that directly finance the construction of illegal settlements in the Palestinian territories.<\/p>\n

El-Kazzaz explained<\/a> that the shareholders in “AngloGold Ashanti” are not only linked to financial investments but also have ties with partners who provide advanced technology to the Israeli occupation army and its security services. These ties may raise questions about the nature of the investments and their impact on the region.<\/p>\n

On the other hand, Reuters reported that the acquisition<\/a> deal expands AngloGold Ashanti’s portfolio to include other major gold-producing areas. The company owns assets in nine different countries, including Tanzania, the Democratic Republic of the Congo, Ghana, Guinea, Australia, the United States, Brazil, Argentina and Colombia.<\/p>\n","protected":false},"excerpt":{"rendered":"

AngloGold Ashanti’s acquisition of Centamin, operator of the Sukari gold mine, raises legal questions about Egypt’s rights and share of revenues.<\/p>\n","protected":false},"author":11,"featured_media":10651,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"footnotes":""},"categories":[409],"tags":[19512,19513,19514,19517,19516,19229,738,19518,19515,19511],"kateb":[710],"class_list":["post-18434","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economics-en","tag-anglogold-ashanti","tag-centamin-acquisition","tag-egypt-gold-mining","tag-egypt-mining-royalties","tag-law-222-of-1994","tag-marsa-alam-gold","tag-mostafa-madbouly","tag-pharaoh-gold-mines","tag-sukari-concession-agreement","tag-sukari-gold-mine","kateb-zawia3-com"],"jetpack_featured_media_url":"https:\/\/zawia3.com\/wp-content\/uploads\/2024\/09\/\u0645\u0646\u062c\u0645-2.png","_links":{"self":[{"href":"https:\/\/zawia3.com\/en\/wp-json\/wp\/v2\/posts\/18434","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/zawia3.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/zawia3.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/zawia3.com\/en\/wp-json\/wp\/v2\/users\/11"}],"replies":[{"embeddable":true,"href":"https:\/\/zawia3.com\/en\/wp-json\/wp\/v2\/comments?post=18434"}],"version-history":[{"count":1,"href":"https:\/\/zawia3.com\/en\/wp-json\/wp\/v2\/posts\/18434\/revisions"}],"predecessor-version":[{"id":18435,"href":"https:\/\/zawia3.com\/en\/wp-json\/wp\/v2\/posts\/18434\/revisions\/18435"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zawia3.com\/en\/wp-json\/wp\/v2\/media\/10651"}],"wp:attachment":[{"href":"https:\/\/zawia3.com\/en\/wp-json\/wp\/v2\/media?parent=18434"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zawia3.com\/en\/wp-json\/wp\/v2\/categories?post=18434"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zawia3.com\/en\/wp-json\/wp\/v2\/tags?post=18434"},{"taxonomy":"kateb","embeddable":true,"href":"https:\/\/zawia3.com\/en\/wp-json\/wp\/v2\/kateb?post=18434"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}