Oman Adopts New Mining Law

Oman's long-awaited new Mining Law* comes into effect on 14 March 2019, bringing in hopes of attracting new investment and revitalising its mining industry. The mining industry has been targeted as one of five key sectors to drive Oman's economic growth and diversification. Concurrent with the passage of the new Mining Law, the Public Authority for Mining ("PAM") announced the identification of new mining projects and initiatives with an investment value of over $2 billion. The new Mining Law provides a far more robust framework for the mining sector intended to provide more incentives, transparency and certainty to investors, while at the same time balancing the PAM's oversight role, the interests of local communities, the prioritisation of local employment, the protection of the environment and the enforcement of investment commitments. This article outlines the key developments of the new law.

Upon the effective date of the new Mining Law on 14 March 2019, the prior law of 2003** is cancelled and all laws that contradict its provisions shall not be effective. However, all existing licences and agreements shall continue to have effect.

The Role of the Public Authority for Mining

The Mining Law aligns the law with the existing regulatory framework, as it recognizes the PAM, which was established in 2014 to regulate the sector - as the competent mining authority.

The competencies of the PAM are more clearly outlined in the new Minerals Law. It is granted broad regulatory and supervisory powers, including the right to issue exploration, prospecting and exploitation licences and mining concessions, to conduct inspections of mining activities, to ensure compliance by the licence holder with the terms of the licence and enforcement powers in the event of any non-compliance. It also has the authority to seize private property from land owners in the name of the public interest, if there is a belief that the property may contain significant mineral wealth that may be of benefit to the national economy.

Licensing and Concessions

Licences for exploration and prospecting may be granted for one year terms, renewable for similar periods up to three years. The licence period for exploitation is up to five years, renewable for additional similar periods. Concession agreements for large deposits may be granted for periods between 20 and 30 years.

License holders may no longer hold on to their licenses without performing their obligations. The PAM has...