Quarterly report - part 1
Centamin Egypt Limited
26 October 2004
CENTAMIN EGYPT LIMITED
('Centamin' or the 'Company')
ACN 007 700 352
QUARTERLY REPORT FOR THE PERIOD ENDING 30th SEPTEMBER 2004
CORPORATE ACTIVITES
• The Egyptian Government
As previously advised, as a portent to political and economic change in Egypt,
on the 14th July 2004, the President, His Excellency Mr Hosni Mubarak, appointed
a new Prime Minister and 35 member cabinet. Subsequent to this a new Minister
was appointed with responsibility for the mining sector, with the previous
Minister not being retained at any government position.
Following a detailed review of ministerial portfolio's, the President has issued
a Decree announcing the transfer of the Egyptian Geological Survey and Mining
Authority ('EGSMA') and its functions, from the Ministry for Industry and
Foreign Trade to the Ministry for Petroleum and the renaming of EGSMA to the
Egyptian General Authority for Mineral Wealth.
The Minister for Trade and Industry, His Excellency Rashid Mohamed Rashid and
the Minister for Petroleum, His Excellency Sameh Fahmy, have stated that the
decision is in the Egyptian economic interest as the Ministry for Petroleum has
the necessary professional skills and foreign investment experience that is
required to attract and negotiate with the international investors that Egypt
needs in-order for the commercial development of its considerable, yet untapped
mineral wealth to occur.
The Petroleum Ministry presently manages in excess of thirty commercial
relationships with international companies such as Shell, Amoco, British Gas and
Pennzoil and is actively involved in large project financing transactions
relating to oil and gas infrastructure.
Dr Atef Dardir, a former chairman of EGSMA and board member of the Arab Mining &
Oil Council commented publicly that the decision was necessary to restore
international investor confidence in the Egyptian mineral exploration and mining
sector.
With the transfer of responsibility for mineral exploration and mining to the
Petroleum Ministry subsequent to the Presidential Decree, the Company looks
forward to meeting with His Excellency Sameh Fahmy at the earliest opportunity.
In addition to this change, the new Egyptian government's commitment to
far-reaching economic reforms has been further demonstrated with the Cabinet
announcing a major overhaul of the country's customs regime, with greatly
reduced tariff rates, simplified customs procedures and a reduction in personal
and corporate tax rates to a maximum of 20%, as part of an overall policy for
preparing Egypt for wider integration into the global economy.
The government has signalled that the days of trade barriers and sheltered
industries are numbered and the reforms are expected to bring Egypt in line with
its obligations under the General Agreement on Tariffs and Trade (GATT).
• Eastern Desert Concession (the 'Concession') - Legal Actions
During the quarter the Company submitted further documents to the Centre for
Arbitration as requested by the 23rd September 2004. Company representatives
attended a meeting of the arbitrators on 17th October 2004 and are now
petitioning the Centre for a judgement.
As a consequence of the major political and economic changes being implemented
by the Egyptian Government, the Company has, as a matter of policy, elected not
to vigorously pursue its action in the Administrative Court for the time being.
• EGSMA - Status Report
Following the publication of comments made by Mr Abdul El Hassan Abd El Raouf
Soliman, the current Chairman of EGSMA on the EGSMA website relating to the
matters before the Court and the Centre, the Company wrote to Mr Soliman
requesting him to formally withdraw or correct his comments immediately on the
basis that they were false and misleading. As no withdrawal or correction was
forthcoming, a penal action for false accusations was filed by the Company's
subsidiary Pharaoh Gold Mines NL against Mr Soliman under Article 305 of the
Egyptian Penal Code. This action remains in front of the courts.
• Sukari Project - Status Report
The Sukari project is the most advanced gold project in Egypt and will be the
country's first gold producer in the modern era and, as such, the Company
understands that it is important to seek resolution to all matters in a
non-confrontational and co-operative manner wherever possible. The Company
remains fully committed to helping develop a significant gold mining industry in
the country.
Although this approach has taken significantly more time, we believe it has and
will provide for an even more supportive framework in which to deal with the
Government during the lead up to and through project construction. The Company
is resolved to continue to abide by both the spirit and intent of the Concession
Agreement.
Seven drill rigs remain on site at Sukari ready to resume the task of completing
infill and extension drilling. Metallurgical samples have been assembled and are
ready for shipment to Australia as part of the Bankable Feasibility Study into
the development of a 4 to 5 million tonne per annum processing facility.
For Centamin Egypt Limited
Josef El-Raghy
Managing Director
26th October 2004
This information is provided by RNS
The company news service from the London Stock Exchange
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