Mena Mining eBook a4 10p Screen

7/29/2019 Mena Mining eBook a4 10p Screen

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A Qck G toMg t Kgom

o Sa Aaa

Discover the most exciting opportunities,projects and players in the Saudi Arabianmining industry


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1. What opportunities Saudi oers the global mining industry

Discover the scale and types o mineral and metal wealth available and see howthe Ministry or Mines (DMMR) and Saudi Geological Survey are opening upopportunities to exploit this wealth.

2. Who is driving these opportunities?

Who are the major contacts to talk to or data, to secure licences, to invest, toconsult and to supply? Take a look at who is pulling the strings and who is rmlyentrenched in this highly lucrative rontier market.

3. What the most exciting projects are

From Jabal Sayid to Khnaiguiyah, we give a brie overview o the majorproducing projects in numbers. We also share the hottest exploration projects tolook out or. Look out for our next report on production challenges and opportunities

associated with these projects.

Ow Saudi Arabia is among the richest and

most diverse countries in the Middle Eastand Arica in terms o metal andmineral potential.

In line with the country's push to diversiyits economy away rom hydrocarbons,Saudi Arabia's mining sector is targetedto become the "third pillar" o the

country's economy.

To achieve this, the Saudi governmenthas oered many incentives to investorsin mining and mineral basedmanuacturing in the Kingdom over thelast decade. The issuance o a newmining investment code has made iteasier or international rms to becomeinvolved in the nations ast developingmining industry.

Wat w oa o t

oowg ags?

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Cot ow Total area: Approximately 2.5 million square

kilometers in size and 1 third o that(more than 650,000 km2) encompassesthe Arabian Shield.

According to the Ministry o Petroleumand Mineral Resources there are 1,270sources o precious stones and 1,170sources o other minerals in Saudi Arabia.

Composed o 4 major geologic divisions:Arabian Shield, Arabian Platorm, Harrats,and the Red Sea Coastal Plain.

The majority ometallic mineral depositsare completely present within the bordero Districts and Belts inside theArabianShield, whereas non-metallic, industrialminerals and/or construction materialsare located within theArabian Platormsedimentary cover.

Map displaying the geologic divisions that orm Saudi Arabia

Arabian plate

Plate boundary

Outcropping Precambrian

Transorm aults

Eurasian plate

Arican plate

Turkish plate

Sutsurace Cambrian salt basins



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Deputy Ministry or Mineral Resources

DMMR is the sole agency responsible or implementing the provisions o the Mining Code andRegulations. All enquiries and applications should be addressed to DMMR.

A major objective o the DMMR is to stimulate the development o a sound mineral industry. Theintention is to provide reliable geologic and economic data to prospective investors.

DMMR has compiled a comprehensive database on the geology and mineral resources o theKingdom, which is readily available or examination or purchase by investors and other interestedparties. This includes maps, databases, archives and reports.

The Mining Investment Law in use today is the version introduced in 2004. It is the basicramework or controlling exploration and mining activities in the Kingdom.

AReconnaissance license allows its holder to examine the area covered by the license or allminerals not excluded by the Law. It is issued or a period o two years and may be renewed orextended or a single two-year period.

An Exploration license conveys two important rights -- the exclusive right to explore within thelicense area, and the exclusive right to obtain a mining lease. It is issued or a period o ve yearswhich may be renewed or extended or a period or periods not exceeding ve years in total.

AMining license coners the exclusive right to produce and exploit specied minerals in thelicense area. The area is restricted to a maximum o 50 sq.km. and is issued initially or a periodo up to 30 years. A maximum surace rental o SR10,000 (approximately US$2,667) per square

kilometer per year is payable.

Incentives

The Mining Law permits all document holders to use water resources within theirconcession area, subject to any existing arrangements that may have been made or thesupply o towns or villages.

All equipment required or the implementation o a concession is exempt rom import andexport duties.

Attractive terms are available or nancing mining projects, rom government institutionssuch as the Saudi Industrial Development Fund (SIDF), and the Public Investment Fund(PIF). Details o these unds' requirements are available rom the respective institution.

Prots and capital may be repatriated without any restriction.

There are large tracts o geologically avorable land available. Many prospects areavailable or urther exploration and evaluat ion. Comprehensive reviews o both metallicand non-metallic mineral resources have been published.

K ogasatos



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Saudi Geological Survey

Established as an independent entity attached to the Ministry o Petroleum and Mineral Resourcesollowing a Council o Ministers Decision in 1999.

Currently producing the rst Metallogenic Map or the Kingdom o Saudi Arabia.

Stated mission to use trained proessionals, consult the government and the community onearth sciences, utilize advanced technology to produce geoscience inormation, and developsustainable mineral and water resources. They also aim to protect the environment and monitorgeohazards to secure a better lie or our people.

Headquarters are in Jeddah, which is located on the Red Sea and is the second largest city inthe country. Jeddah is also adjacent to the western margin o the Neoproterozoic Arabian Shield,and studies o that geologic region orm one o the primary oci o the Saudi Geologic Survey. Abranch oce is maintained in Riyadh , the capital o the country and houses acilities or making

and printing topographic maps.

Alara Resources

Alara Resources Limited (ASX Code: AUQ) have zinc and copper properties in the Kingdom o SaudiArabia as well as several copper and gold interests in the Sultanate o Oman and the El Quillay copper-gold properties in Chile, South America.

Alara Resources is a committed explorer and miner, with its Head Quarters in Perth, Australia ocusedin the Gul Region o the Middle East and South America with substantial existing inrastructure.

The company has been successul at integrating services rom around the region. It aced challengeslocating certain services and equipment, including drilling machines eventually obtained rom Turkey.

Alara Resources cites the ollowing attributes as being what attracted them to KSA: Low tax rates,permitted ownership o 100%, royalties nil, prots are repatriable, excellent tenure certainty, goodinrastructure and low uel prices.

Maaden

Maaden is Saudi Arabias biggest mining company. It was ully state owned until

2008 when they foated 50% o their shares on the Saudi Stock Exchange (Tadawul).Maadens activities are heavily concentrated on gold; they currently operate 5gold mines and own over 11 million ounces o JORC compliant gold resources atexploration and development stage. Phosphate production started in 2011 and theyhave several aluminum projects underway. They have a strong ocus on exploration toexpand the company urther and increase their mineral portolio.

In 2011, Maaden had close to 50,000 sq km in concessions, which representsapproximately 10% o the whole Arabian shield.

In 2011, resources totaled 11 Moz.

Basic target or precious metals is to add 1.5 Moz o gold resources per year,with emphasis on higher grades and near mine extensions.

In addition to gold, Ma'aden aim to grow their resource base in phosphate andbauxite (in 2011, phosphate totaled 1.5 billion tones, whilst bauxite totaled300 million tons as, aresource).

Ma'aden is diversiying urther to include new minerals. These include base metals, namelycopper and zinc, as well as new minerals including uranium and rare earth elements.

To do this, the company has embarked on electromagnetic, airbourne surveys, asquicker alternative to ground surveys.

4 main business areas:

Gold and base metal.

Phosphate project - including a joint venture between

Ma'aden Phosphate and SABIC.Aluminum project - consists o a joint venture with

Alcoa; is currently in the construction phase.

Industrial minerals - including magnesiumcarbonate, kaolin and bauxite.



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MGBM (Ma'aden Gold and Base Metals Company)

Maaden wholly owned subsidiary.

Operates 5 gold mines: Sukhaybarat, Bulgah, Al Amar, Al Hajar, Mahd Ad Dahab.

Gold and base metal portolio comprised approximately 11 million Oz o resources in 2011.

Average annual production (2011): 150,000 Oz.

2 new mines under execution: Ad'Duaihi and As-Suq mine.

3 mines under consideration or development Mansoura, Massara and Ar-Rjum.

Key challenge: the mines remote locations and the resulting scarcit o water.A new 500km treated water pipeline is being constructed between ai all theway to central KSA to eed water to these planned gold mines.

Ma'aden Phosphate Company

Ma'aden's Phosphate business currently consists o a joint venture with SABIC in which Ma'adenowns 70% and SABIC 30%, and the Al Khabra Project which is wholly owned by Ma'aden.

United Arabian Mining Company (MANAJEM)

Privately owned Saudi mining company.

50% ownership o the Khnaiguiyah Mining Company LLC (KMC) which runs the KhnaiguiyahZinc-Copper Project.

Umm Add Dammar. Copper/zinc/gold. Drilling and surace samples indicate 7mt strategicore reserve with 1.5% copper grade.

Umm Ash Shalaheeb. 2.5 mt with 16g/ton grade gold and 2.5% zinc.5 exploration projects covering precious (gold, silver, platinum) and base (copper, zinc)

metals and industrial (quartz, silica, dolomite).

Engr. Mohamad AbdalahAl Hatlani,CEO, ManajemTel: +966(1)2251201/40,

Fax: +966(1)2254218

Andy LloydVice President CommunicationsTel: +1 416 307-7414Email: [email protected]

Deputy Ministry or Mineral ResourcesP.O. Box 345, Jeddah 21191,Kingdom o Saudi ArabiaTel: (966-2) 667- 4800,

Web: www.dmmr.gov.sa,Email: [email protected]

Darko KulasCorporate Relation Corp. Communication,MaadenTel: +966 (11) 874 8397,Fax: +966 (11) 874 8057

Zohair NawabCEO, Saudi Geological Survey AbdullahAl Attas, Assistant President or TechnicalAairs, Saudi Geological Survey

Tel: 966-2-619-5000, Fax: 966-2-619-600

K cotacts

Barrick

TSX listed, Barrick is one o the worlds leading gold producers and has been present

in Saudi since 2011. In 2013 ull year gold production guidance is 7.0 - 7.4 millionounces rom a portolio that includes some o the worlds premier gold assets. Barrickhas operating mines and advanced exploration and development projects locatedacross the world, and large land positions on some o the most prolic and prospectivemineral trends.



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Map displaying the location o the KhnaiguiyahZinc-Copper Project in Saudi Arabia

K ojcts

Khnaiguiyah Zinc-Copper Project(Manajem/Alara Resources)

Location: Approx 200km west o Riyadh

Stage: Near production

Alara has a 50% interest in the advancedKhnaiguiyah Zinc-Copper Project via a50% shareholding interestin a newlyormed joint venture company, Khnaiguiyahor Mining Company (KMC).

The Khnaiguiyah Project is advanced - nearproduction - and the Denitive Feasibility Studyshows it to be nancially and technically robust.Now the ocus is on project nancing and mineconstruction.

LOM o 13 years at 2Mtpa. Total LOM productionwill be 1.4Mt zinc concentrate and 0.21Mt copper

concentrate.

The project comprises a core mining license,o about 6sq km. Around this there is about380sqm o exploration licenses and applications.



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Map displaying the location o the Jabal Sayid copper project

Jabal Sayid copper project(Bariq)

Location: Approx 350 km north-east of

Jeddah.

Stage: Near production

The Jabal Sayid copper project is owned by Barrick Goldas a result o the acquisition o Equinox Minerals Limited.

The mining license or the project was granted in May2010.

The plan is to open an underground mining operationthat would have an 11 year mine lie.

Construction o the processing inrastructure wascompleted in Q3 2012, but commissioning wasdelayed when Barrick received notication thatthe mine site was not in compliance with the recentlyintroduced saety and security standards.

Following receipt o the notication, a dedicated EPCMteam has been working towards achieving ull compliancewith these standards in a process that is expected totake until 2014 and cost approximately $100 million.

Average annual production rom Jabal Sayid isexpected to be 100-130 million pounds o copperover the rst ull ve years o operation at C1cash costs o $1.50-$1.70 per pound.

As o December 31, 2012, Jabal Sayids copperreserves were 1.34 billion pounds.



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Al-Zabira Bauxite Mine(Maaden/Alcoa)

Low Grade Bauxite and Kaolin: The Az-Zabirah mineconsists o an open pit mine, in the central zone o theAz-Zabirah bauxite deposit, and a processing acility.The mine started operation in 2008.

Ma'aden's $10.8 billion joint venture with Alcoa will be thelargest and most ecient vertically integrated aluminiumcomplex in the world.

The new project can be divided into 4 sectors:The Bauxite Mine: In Ba'itha, in the North o the Kingdom,

that will produce 4 million tons annually. This mine will beoperational in 2014.

The refnery: Located in Ras Al Khair in the Jubair area,it will be the rst alumina renery in the GCC, with anestimated production o 1.8 million tons o aluminaannually. Due to be operational in 2014.

The smelter: Due to become operational in 2013 andestimated to produce 74,000 tonnes pa, but designedor expansion.

The rolling mill: Will become operational in 2013, withan estimated production o 380,000 tonnes pa, designedor expansion.

Al-Jalamid Project(Maaden)

Production started in Q2 o 2011 ater 4 yearso development.

Represents an investment o 5.6 billion.

Produces 3 million tonnes o DAP and 1.4 mtonnes pa o phosphoric acid.

Maaden also expecting to produce 1.5m tonnespa o phosphoric acid rom the Al Khabra deposit.

Yanbu Magnesite(Maaden)

Maadens magnesite project comprises the operationalmagnesite mine at Zargat and the processing plant atMadinah Industrial City.

Sahara & Ma'aden Petrochemical Company are alsoproducing caustic soda and dichloride ethylene.



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What is the Ministry doing to attract international mining companies

to set up business in Saudi Arabia?

The Saudi government has oered many incentives to investors in mining, mineral and mineralbased manuacturing in the Kingdom o Saudi Arabia in its 8th ve year development plan. Theissuance o the Mining Investment Code, at the start o the 8th ve year development plan wasthe most important incentivizing actor or investments.

The Saudi government has been working on its diversication plan or the last decade and themining and mineral sector has proved to be the best economic base or diversication.

The creation o ve economic (industrial) cities in Saudi Arabia which oer ; water, electric power,uel and nancing through the Saudi Arabian General Investment Authority (SAGIA) and all otheracilities at reasonably cheaper cost.

In addition the repatriation o (any amount) money, with or without a Saudi business partnersetting options, transparency in mining and exploration licenses are included in the incentivesgiven by the Saudi government.

The Saudi government encourages and promotes the integration o mining with other economicactivities, ensuring the value-add to the Saudi mineral resources and manuacturing o high-techindustrial raw materials, semi nished and nished products.

To attract domestic and international investors in minerals and mining sectors, the Saudigovernment in the last ew years has put eorts into identiying and developing potential mineralresources and potential mining areas in the Kingdom o Saudi Arabia. In addition to providingnecessary inrastructure, the Saudi government has taken care o sustainable and environmentally

riendly mining activities through mining and environmental laws and regulations.

The 9th ve year plan o Saudi Arabia is targeted to achieve an annual growth rate o 7.2% in thissector. In the domestic production o building material the targeted growth rate is between 8-9%that requires international investment in modern techniques not only in mining but also in mineralprocessing and manuacturing.

What do international mining companies need to know about

operating in Saudi Arabia?

The Saudi governments priority is to produce added value products and notexporting bulk unprocessed raw materials in any commodity. The Saudi governmentoers signicant help i you are planning to convert low priced non-metallic mineralcommodities to high quality and high value mineral specialty.

Integrated industries and mineral value chains are the priorities o the Saudi government.I you have technology or mineral processing and adding value to mineral commodities,Saudi Arabia is the best place to invest.

Interview with:

Abdullah Al Attas,

Assistant President for

Technical Affairs,

Saudi Geological Survey

"The 9t five yeAr plAn Of SAudi ArAbiA iS

TArGeTed TO AChieve An AWnnuAl GrOWTh

rATe Of 7.2% in The MininG SeCTOr"

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Which metals/minerals hold the best opportunities in Saudi Arabia?

In metallic minerals: Gold, Rare Earth, Copper Zinc

In non-metallics:

1.Silica Sand or colorless glass, specialty glass, solar glass, optical glass

2.Quartz (lump quartz) or silicon metal, silicones (manuactured rom silicon metal), high purityquartz (or used quartz production) and its downstream

3.The most important opportunities are in processing quartz to produce high purity quartz andused quartz (glass)

4.Limestone: manuacturing o ground calcium carbonate ( less than 5 micron), precipitated

calcium carbonate (llers or plastics and paints), high quality quicklime and constructionmaterials

5.Basalt continuous ber and composite manuacturing

6.High quality eldspar raw material or ceramics

How many international projects are already underway

in the region?

Active projects are in the ollowing felds:

From Saudi Bauxite to aluminum metal production with a Canadian companyand Saudi Maaden

Production o used magnesia rom Saudimagnesite

Several gold mining projects

Base metal project

Three projects in polysilicon manuacturing, two in Jubail and one in Yanbu

One silicon carbide production project

Silicon metal production (not yet started)

Ground calcium carbonate project

Two foat glass projects

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Mena Mining eBook a4 10p Screen