Copper bottomed in Saudi Arabia

Citadel Resource Group started trading on the Australian stock exchange on December 17 with a 50% interest in the major Jabal Sayid copper project and a 100% stake in an interesting portfolio of copper, gold and other base and precious metal projects on the Arabian Shield in Saudi Arabia.

The potentially worldclass Jabal Sayid copper project already has announced an Interim JORC Code compliant inferred and indicated mineral resource statement for the copper and zinc components of the deposit of 46.2 Mt at 1.8% Cu, including 6.5 Mt at 1.55% Cu and 1.3% Zn. Citadel has stated that there is potential for “further substantial growth” in the resource with ongoing exploration of Jabal Sayid’s four known zones of mineralisation and beyond.

The is undertaking a major resource program to drill out Jabal Sayid and has two rigs currently drilling on site with an additional two rigs contracted to be drilling by the end of Decmber.

Citadel is headed by experienced resources industry CEO, Ms Ines Scotland, a former senior executive with the likes of Rio Tinto, Comalco and Lihir Gold. “An upgraded resource will be released in the first quarter of 2008 and we expect it will provide a significant lift in tonnage,” she said.

Citadel has also recently commenced drilling at a second project in its inventory – the 100% owned Jabal Shayban project. This project has a JORC Code compliant resource of 250,000 oz of gold which is open in all directions. The aim of this program is to double the size of this oxide gold resource and scope out the potential for copper mineralisation at depth.

The emergence of Citadel with its extensive Saudi Arabian mining project interests follows significant changes to that country’s approach to exploring and developing its rich mineral resources. The Saudi Arabian Mining Investment Code ratified by Royal Decree in October 2004, which became effective from in January 2005 has key objectives including:

  • Increasing the relative importance of mining in the national economy
  • Attracting investment into the mining sector
  • Streamlining procedures for mining projects
  • Creation of job opportunities for Saudi nationals
  • Transfer of mining technology to the Kingdom of Saudi Arabia.

Citadel says the new Saudi Arabian Investment Code offers an attractive base for mineral exploration and mine development, including certainty of tenure, an attractive fiscal regime with a 20% corporate tax rate, no mineral royalties and exemption from import duties on capital plant imported for mining project developments.

This has led to a rash of developments in the minerals industry with Rio Tinto reaffirming its commitment to a $6 billion alumina project it acquired via takeover, CHALCO committing in excess of $1 billion in a second alumina project and Maaden, the state owned mining company, undertaking a $4 billion phosphate project.