Monday, July 30, 2012

Myanmar attracts potential investors to mining meeting

A mining summit held in Yangon, 22-24 July, showed huge interest in Myanmar’s mineral deposits by attracting 300 attendees from 26 countries, the Myanmar Times reported.

Notable foreign presenters included mining veteran Owen Hegarty, Tigers Realm chairman, Chris de Lavigne, global vice president of industrial practices at Frost & Sullivan and Hideyuki Ueda, executive director, metals strategy and exploration at Japan Oil, Gas and Metals National Corporation (Jogmec).

Mining accounts for only 1% of Myanmar’s of gross domestic product and the country’s lack of international contact was most evident when officials from the Ministry for Mines opened the floor to questions from audience members.

“Inquiries regarding copper and gold production estimates, access to geophysical data archives and the number of exploration drillings that have been done in Myanmar were largely sidestepped by ministry officials. The lack of straightforward answers carried over to pieces of regulatory framework, notably the timeframe for mining and exploration licences to be processed and approved, and what is required to secure a title,” the newspaper reported.

The biggest stumbling block for potential miners is Myanmar’s 30-70 production sharing contract (PSC) between the private party and the Ministry for Mines. Under the Mines Law, enacted in 1994, the Ministry of Mines acts a non-equity partner but is still entitled to 30% of minerals extracted, plus the relevant income tax and royalties owed.

“Until PSCs are reworked or abolished, we won’t be doing business here,” said one Australian industry veteran, echoing the feelings of many delegates.

Minister for Mines U Thein Htaik said the ministry was “trying to amend the Myanmar Mines Law with the advice of experts”, but an exact date of the release of the new laws has not been announced.

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