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Iran ramping up mining activity and NICICO outlines major expansion

Posted on 11 Jul 2014

Some 41 mining projects, valued at €6 billion, are being implemented in Iran, the Deputy Director of the Iranian Mines and Mining Industries Development and Renovation Organisation (IMIDRO), said recently, when he was quoted in the Tehran Times. Jamshid Mollarahman has also stated via the Mehr News Agency that the administration has prioritised the expansion of mining and mineral exploration activities. The projects will create about 25,000 direct jobs, he stated. In March, IMIDRO Director Mehdi Karbasian said that the number of foreign companies which are ready to participate in Iran’s mining projects is on the rise. One of the main policies of the administration is to encourage Iranian investors living overseas to participate in domestic development projects, Karbasian said.

About 5,000 mines are being exploited in the country, he stated, adding that Iran is also one of the top 15 countries in the world in regard to mineral reserves and exports its industrial and mineral products to 159 countries, including Iraq, China, the United Arab Emirates, India, and Afghanistan. After an interim deal between Iran and six world powers on Iran’s nuclear activities last November, the Islamic Republic has been planning international investments in its energy, auto and mining industries. The deal aims at limiting some of Iran’s nuclear activities in exchange for partial sanctions relief.
Iran’s flagship existing mines include the Sungun and Sarcheshmeh operations, run by National Iranian Copper Industries Company (NICICO). It has just announced that its production capacity will reach 400,000 t by 2018. NICICO’s CEO, Ahmad Morad Alizadeh has forecast the copper concentrate output capacity to reach 280,000 t in 2015, 300,000 t in 2016, 350,000 t in 2017, as well as 380,000 to 400,000 t in 2018, respectively. “Small- scale mines demand large investments, while the small private sector is not able to meet the financial resources. The private sector is not capable of taking high risks in the area of exploration, thus negotiations are ongoing with Ministry of Industry, Mine and Trade, IMIDRO, NICICO, banks, as well as the Mines Insurance Fund to decrease the aforementioned risk,” he also noted.

By launching the second phase of the Songon and Sarcheshmeh mines’ development plans in the current Iranian year (started March 21), 300,000 t will be added to the country’s copper concentrate production capacity. “In the preceding six months, a defined and continuous review is undertaken on the ​​profitable and efficient projects, thus the plans with higher added value will be implemented. Setting up concentrate production plants is of more revenue in comparison with other projects. As by processing 0.5% ore and reaching 25% alloy, the economic value will be boosted 40 to 50 times.”
“By launching the mentioned plans, the capacity will be fulfilled in the coming two years and both plants will be operational in East Azarbaijan, and Kerman provinces in the second half of the year,” he stated.