Oman Mining Co seeks international partners

By Conrad Prabhu — MUSCAT: Dec 24: State-owned Oman Mining Company (OMCO) says it is weighing potential partnerships with international investors and globally reputable mine operators as part of a strategy to return to its heyday as the nation’s pioneering mining exploration and processing firm. OMCO Chairman Abdulsattar al Murshidi said the company is currently evaluating a number of “scenarios” designed to bring about a turnaround in its fortunes and position itself as a leading, competitive and efficient player in the Sultanate’s burgeoning mining and minerals development industry.
“OMCO is presently at the stage of reinventing, reshaping and restructuring itself, and we are looking at several scenarios to achieve this objective,” said Al Murshidi. “One such scenario is to establish joint ventures with reputable global mining organisations for the joint operation of our assets. Another scenario is to look for global investors and together rebuild the capability of the company.  These options are presently being considered with the ultimate goal to run an efficient company and an active exploration programme.”
Set up by Royal Decree in 1981, the 100 per cent government-owned enterprise was established with a mandate to facilitate the discovery, excavation, manufacturing and marketing of minerals in the Sultanate.   Mining operations began in 1983 with the focus on three rich copper deposits in the Sohar area.   Backed by investments in the nation’s first ever copper concentrator, smelting and refining facilities, OMCO delivered an average output of around 20,000 metric tonnes of copper annually.  Production however declined as the deposits depleted, prompting the company to run the plant as a toll smelting operation.  Under this model, copper concentrate sourced from international traders is smelted into cathodes for a fee.
Importantly, elements of OMCO’s ambitions to bounce back as a heavyweight of Oman’s rapidly expanding mining sector will be outlined at the Oman Minerals & Mining Exhibition and Conference, which will take place at the newly opened Oman Convention & Exhibition Centre (OCEC) during January 16-18, 2017. The three-day event, billed as the largest mining-related expo to be hosted by the Sultanate, has been organised by Taadeen Oman with the support of the Public Authority for Minerals (PAM).
Speaking exclusively to the Observer, Al Murshidi said the company is studying Expressions of Interest (EoIs) received from international mining corporations to join hands with OMCO in the development of copper-gold deposits in Block 10 in Dhahirah Governorate.
“We had recently issued an Expression of Interest inviting global players to participate in Block 10 either as investor or joint operator, and feedback from interested parties is being reviewed at the moment.  An additional option is for them to come in as an independent operator and we will lease our concession to them.”
Similarly, OMCO is also in discussion with Mining Development Oman (MDO), a new entity established earlier this year with a capital of RO 100 million. Contributing 60 per cent of the equity are the following four state-owned investment arms of the government: State General Reserve Fund (SGRF), Oman Investment Fund (OIF), Oman Oil Company, and Oman National Investments Development Company (Tanmia). The remaining RO 40 million is promised to be raised via an Initial Public Offering (IPO) floated on the Muscat Securities Market.
Citing OMCO’s legacy as a mining industry pioneer, Al Murshidi says the company still has the potential to make an important contribution to the nation’s economic development. “OMCO was once a very prestigious company, and is eager to get back into action as an important player.  The company has sizeable assets that can be suitably developed.  Moreover, OMCO is well-respected in the local community, having provided employed to two generations of people in the area that we serve.  Local folks feel an attachment to OMCO.”
Among the opportunities that OMCO is keenly studying as part of a turnaround strategy is to venture into non-ferrous metals exploration and development, notably limestone.  Avenues to downstream value-adding activities are being explored too, he said
Additionally, OMCO is excited about the mineral potential of its Yanqul operations which, according to Al Murshidi, has the potential to significantly surpass that of its erstwhile Sohar operations.