Economy - Development
Angola seeks to increase investments in mining
afrol News, 3 March - By liberalising its mining regulations and offering favourable investment terms, Angola hopes to attract more international mining companies to help the country tap its vast mineral resources. With most of the country yet to be surveyed, "current mining operations represent only a fraction of Angola's full potential," according to the Luanda government.
Angola's state-run Agęncia Nacional para o Investimento Privado (ANIP) is running a campaign to attract more foreign investments to the country's already important mining sector. Mineral resources - in particular oil and diamonds - already make up a totally dominant part of Angola's national economy. The country however has a wealth of largely untapped mineral deposits.
According to ANIP, "Angola offers myriad mining opportunities for potential investors." With only 40 percent of the country's territory surveyed, "Angola remains one of the least explored, mineral-rich countries in all of Africa," the state agency says.
In addition to its growing diamond mining sector, the country also has commercial deposits of iron ore, manganese, phosphates, copper, gold, lead, zinc, tin, wolfram, tungsten/vanadium, titanium, chrome, beryllium, kaolin, quartz, gypsum, marble, ornamental stones and uranium. "These natural resources, coupled with regulatory reforms, make the sector ripe for private investment," ANIP says.
Luanda authorities have launched several reforms and projects to attract more investments in the sector. This in particular includes a series of regulatory changes that have been instituted over the past few years. Generally, Angola has established a mining policy that eliminates the state's monopoly of mineral rights and opens the sector to private investment.
Any legal company, whether it is public, private, mixed or a joint venture, may apply to the Luanda Ministry of Geology and Mines for a prospecting license that gives the company the right to explore and evaluate mineral deposits. A prospecting license is issued for a maximum of five years, including extensions, and is limited to a defined area. Should a company identify minerals for extraction, it would then need to obtain a mining title.
In the case of diamond mining, there are stricter regulations. Here, the Ministry of Geology and Mines issues all alluvial diamond mining licenses, while kimberlite mining licenses must be authorised by Angola's Council of Ministers. In addition, Endiama, which acts as the regulator and supervisor of the diamond mining sector, announced a sector reorganisation strategy in 2004 that seeks to end informal mining operations by incorporating artisan diggers into the formal sector.
Also tax policies have been reformed to encourage private investment in the mining sector. By now, "the government offers generous tax holidays and incentives that include an exemption from import duties for all mining equipment and supplies when such materials are not available locally," according to ANIP. Corporate taxation is capped at 35 percent on net profits, while royalty rates on precious stones and metals is set at 5 percent.
Several sub-sectors have been given special priority. According to ANIP, the Angolan government has placed a priority on developing its ornamental stone resources. Since 2001 the number of extractive companies mining for ornamental stones in Angola more than doubled - from four to ten. Marble and black granite mining is expanding. Angola exported 15 million cubic meters of granite in 2004, generating US$ 4 million in revenues for the country. A
The government also has plans to re-launch iron and manganese mining operations. FERRANGOL, the state-owned iron and manganese mining company, commissioned a feasibility study on re-launching the sub-sector and estimates that with a US$ 2 billion capital investment Angola could produce 2 million tons of iron ore a year. The Ministry of Geology and Mining also recently announced that iron ore mining will resume in the Tchicuatiti, Quipungo, and Quilengues regions of Huila province. Manganese deposits are scattered throughout the country.
Gold mining in Angola has largely been concentrated in the Maiombe region of Cabinda province. Some 90 percent of Angola’s gold production is from the area, but other alluvial gold deposits are found in Kwanza Norte, Huila and Cunene provinces. Cabinda also has large deposits of uranium and phosphates.
Other mining opportunities include the revitalization of the Cassinga mining project. "The 2,681 square kilometre area in southern Angola contains gold and other minerals, which if fully developed could produce 10 million tons of minerals worth US$ 320 million per year," ANIP announces. Gold mining in Angola so far largely has been in the Cabinda enclave. Some 90 percent of Angola's gold production is from that area, which also hosts most of offshore oil production.
By staff writer
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