TAKING IT TO THE NEXT LEVEL

Oman 2020 | MINING | INTERVIEW

By working to make the investment process in Oman as transparent and simplified as possible, the Public Authority for Mining seeks to encourage more competitive biddings by the private sector.

Hilal Al Busaidi
BIOGRAPHY

Hilal Al Busaidi has been the CEO of the Public Authority for Mining since 2015. Previously, he worked with Petroleum Development Oman (PDO). Throughout his long career, he has held many different posts, with the latest as petroleum engineering manager. He started his career in 1991 after graduating as a petroleum engineer in the US.

Can you give us a brief overview of today's landscape for mining activity in Oman and how will the new mining law impact the business environment?
In 2018, we issued 26 mining licenses and 35 exploration licenses. This had created about 400 new jobs specifically for Omanis for an investment of OMR700 million. Based on the framework for the mining blocks offerings, we drafted the mining law and sent it for endorsement of those specifications. In order to improve the specifications, we developed an electronic platform that manages all mining and exploration activities and licenses. The platform has the potential to be linked to all governmental systems needed to get an approval. We are planning for the licenses to be applicable for at least five years rather than one, with the option of renewal until 25. We are also trying to put devices that recognize production amounts and send them to the authorities, in order to make follow-up production amount applications unnecessary.

Another law that recently came out is the PPP Law. Under an infrastructural point of view, how can this new law help the mining sector?
PPPs will constitute a key aspect of the infrastructural developments under the new mining strategy, as Oman needs to ensure high-quality road connectivity to either the manufacturing site or production hubs. There are ongoing discussions to build two ports with the Ministry of Transport. In addition, we awarded a consultancy study to define the infrastructural requirement to improve and develop the downstream industry, because that is where the added value could be created. Today, we are offering these blocks for investors, though if they want to build a factory that requires some of the minerals they extract, they have priority over other players, without the need to go through the bidding process.

What is your mapping of the private sector engagement in Oman's mining industry, and how does that define your priorities for 2020?
There are 300 companies with mining licenses, not including exploration licenses, and we have yet to define the criteria to ensure that each company is the best for the right block. A great deal still has to be brought in from abroad, either from the know-how or the investment because over the last decades we have seen exploration activities fall, and we need to manage a healthy portfolio. Larger players need to be given priority, and first and second processing manufacturing are also important. In this environment, our first priority is to focus on a framework for competitive biddings and launching new licenses. Indeed, we aim to make the investment methodology a continuous, transparent, and simplified process. This will allow us to maximize the economic value of the blocks we announced as open for bids and to understand the full contribution of each mining block and the spinoff activities and opportunities that could arise from them both for other businesses and communities. In this sense, innovation for the mining industry will be paramount because it will help utilize every element of minerals, creating value-added products, instead of just exporting the raw materials. It would also help in terms of improving efficiency and cost-effectiveness.