Global
Oman borders the Middle Eastern countries of Saudi Arabia,
Yemen, and the United Arab Emirates (UAE).
Oman rial (OMR) 23 million. Growth of
the sector depends on improved logistics,
infrastructure, and connectivity. Delays in
building the national rail network could
result in raw materials being transported by
road at a higher cost. The Oman Mining
Development Company has been provided
with the required support to develop
the railway between Al Shuwaimiyah in
the Wilayat of Shaleem and Halaniyat
Island and the Wilayat of Duqm in the
Governorate of Al Wusta. The main
minerals mined here are deposits such as
gypsum and limestone.
Energy shortfalls could also inhibit
growth, with restrictions on the
supply of electricity limiting plans to
expand mining facilities in some areas.
Curtailments of natural gas, which is
needed in some smelting and other
processing activities, could pose an
obstacle to downstream development.
The Oman government is moving to
lock in new gas supplies from Iran.
Legislative environment
In Oman, licences for exploration,
appraisal, and mining have to meet
with ‘no objections’ from eight
government bodies to be approved,
which may be expressly bureaucratic
and time-consuming. New draft
legislation proposes to have all relevant
[8] MINING MIRROR MARCH 2018
Geological map of Oman.
government agencies pre-approve large
parcels of mining blocks. These blocks
will then be divided into smaller
concessions and allocated to investors.
The State owns all naturally
homogenous or semi-homogenous
solid minerals. The Omani mining
sector is primarily regulated by
Royal Decree, together with the
Implementing Regulations. In the
current situation, the government
gives priority of grants to national
companies rather than individuals
and restricts foreign investment in
the mining sector. The various types
of licences awarded are exploration
and prospecting licences as well as
longer-term extraction concessions.
Recent changes introduced by the
Regulatory Measures provide that
licence applications, valid for one
year from date of issue, may now
only be made during January and
February annually. The maximum
number of licences granted per year
is limited to 30 for quarries of gravel
and gravel derivatives, and 15 mining
licences for metallic and non-metallic
minerals, valid for a 25-year period.
The new regulations aim to limit the
scope of foreign investment by only
being granted to establishments and
companies that have no more than
30% of their capital held by foreign
investors. There is also an obligation
to employ and train Omani nationals.
It also introduced an obligation on
licensees that an amount equivalent
to 5% of the net annual profits of
the programme be invested in the
development of the local community.
There are no requirements under
Omani law that a government
entity should hold an interest or
share in a mining investment.
Mining and quarrying industries do
not enjoy any specific incentives. Yet,
companies do qualify for incentives
such as exemption from import
duties and other levies, five-year tax
holidays (renewable), and customs
clearance facilities. Royalties are 5%
of the sale value of all minerals and
rocks. Awarding of a mining licence is
subject to justification that sufficient
minerals have been discovered and that
preparations for a mining operation to
be in operation for a minimum of five
years have been done. It is now also a
legal requirement that licence holders
provide reports every three months,
detailing the quantity of both extracted
minerals and estimated minerals at
the permit area, together with details
of any incidents that have occurred on
site during the reporting period. b