For nearly 3000 years, gold has been mined from the sands of Eastern Egypt.
Today however, gold mining is on the wane, and only makes up 1.3 percent of the country’s GDP.
This week, ‘CNN Marketplace Africa’ hosted by Ian Lee, profiles a new company which believes it can change the fortunes of Egypt’s most ancient industry.
The search for gold begins deep into the desert outside Luxor, where ‘Marketplace Africa’ meets LJ Karr, an American geologist with 40 years’ experience in mining gold.
Karr takes Lee underground, in a shaft constructed by Roman slaves, and explains how to identify gold: “The fabric of the rock tells me it's a fault zone and that red and yellow colour tells me that there was once pyrite here that's been oxidized, and the white in the middle of it is a small thin quartz vein, and that was the target of the ancient mining. That would be where the gold is.”
Despite the longstanding traditions of gold mining in Egypt, there is currently only one mine operating in the region.
Nonetheless, Yousef Husseini, the Vice President of Research at EFG Hermes, tells ‘Marketplace Africa’ that mining still holds enormous potential: “It's very geologically rich and I think we've only touched the surface of where this could potentially go. For example, the Egyptian mineral resource authority has identified over 120 gold deposits in the eastern desert alone, so that gives you an idea of the tip of the iceberg out there.”
Although the Egyptian Mineral Resources Authority states that mining makes up 1.3 percent of GDP, the government hopes to grow that figure to five percent over the next ten years.
Husseini explains the potential impact that could have to Egypt to ‘Marketplace Africa’: "It's going to add a lot of GDP growth, it'll add a lot of employment. Mining is a very labour intensive industry and beyond that you'll get a lot of technical knowhow given to the Egyptian people and they'll be able to use that going forward."
Lee meets one of the companies hoping to tap into this potential market, Alexander Nubia International. ‘Marketplace Africa’ learns that the Canadian company is utilising modern technology, which allows for gold to be identified significantly easier.
Geologist Karr explains the importance of these new technologies and companies to ‘Marketplace Africa’: "We're very encouraged, most places in the world you wouldn't have mineralisation at the surface like this, it would have been mined out a long time ago… So literally we have just scratched the surface here. There is a lot more to discover."
The resurgence of gold mining comes with significant risks however, as ‘Marketplace Africa’ learns that for the project to become profitable, a company would have to yield 1.5 grams of gold for every ton of rock.
With over 40 years’ experience, Karr is acutely aware of the risks of mining in Egypt: “We can simply be wrong in our ideas. It could simply be that these deposits are too small. There's political risk, there's economic risk with metal prices. So all those risks are of course cumulative, and anyone of them can derail a project.”
*The article and video were exclusively shared by CNN Marketplace Africa with Ahram Online