YEMEN MINING REGULATION
The Republic of Yemen is an Arab country in Southwest Asia, occupying the south-western to southern end of the Arabian Peninsula. Yemen has a coastline of about 2,000 km (1,200 mi) and is bordered by Saudi Arabia to the north, the Red Sea to the west, the Gulf of Aden and the Arabian Sea to the south, and Oman to the east. The country has experienced a history of political turbulence since its formation which occurred as a result of the unification of North Yemen and South Yemen in 1990. In recent years, former president Saleh caused substantial unrest after making a proposal to alter the country’s constitution in order to perpetuate his family’s political control. He ultimately agreed not to extend his presidency in return for immunity from prosecution for the various crimes committed during his term in office.
Yemen is a large country with a size roughly equivalent to that of Spain. It has substantial potential for economic deposits of gold, zinc, lead, silver, copper, nickel, platinum and iron ore. Yemen maintains policies aimed at encouraging FDI in the minerals sector and its investment laws similarly promote the fair and equitable treatment of foreign investors. The country is not rated by the Fraser Institute, nor are many of the foreign companies active in its mineral sector. One base metal (nickel, copper and cobalt) project was the subject of a major company (Vale International) investment, but the project was apparently dropped in 2013.
PRINCIPAL LEGISLATION AND REGULATOR
The principal minerals legislation in Yemen is the Law Concerning Mines and Quarries of 2010 (No. 22 of 2010) (“2010 Law”), which provides that all mineral resources are State property (2010 Law, Art. 58.2). The 2010 Law is administered by the Ministry of Oil and Minerals and, with respect to licencing, the Geological Survey and Minerals Resources Board (Board). Foreign companies may participate equally in the acquisition of mineral titles. There are regulations that also apply to the sector. Yemen’s mining law was reformed in 2010 following the assistance of the International Finance Corporation, a member of the World Bank Group.
GRANT AND FORMS OF MINERAL TITLE
The 2010 Law includes reconnaissance, exploration, mining, small-scale mining and quarry licences. Set out below are the key elements of some of these licences:
- Reconnaissance Licence: The licence should not exceed 10,000 sq. kilometres, is issued for a period of one year and may be renewed once (2010 Law, Arts. 7 and 12); it does not entitle the holder to carry out trenches, drilling or similar works, but is needed for airborne surveys (2010 Law, Arts. 9.2 and 10).
- Exploration Licence: The licence is an exclusive licence for all minerals and provides the right to obtain a mining licence (2010 Law, Arts. 25 and 28). It is granted for a three-year period and may be renewed twice (2010 Law, Arts. 22 and 23). The licence may not be granted over areas that are already the subject of an exploration, mining or quarry licence (2010 Law, Art. 18).
- Mining Licence: A mining licence is issued for a period of up to 25 years and renewable for periods of 10 years on approval (2010 Law, Art. 33). The holder has the right to use surface rights and must make compensation therefor. The holder must enter into a community agreement, complete an EIA and a closure plan, within one year of the grant and must also commence mining within a further two years. The language is potentially problematic as the failure to adhere to certain conditions can give rise to termination (2010 Law, Art. 97).
Transfers are only permitted on consent of the Board (2010 Law, Art. 65).
In order to obtain a mining licence, one is required to:
- File a feasibility study (2010 Law, Art. 25) prior to obtaining the licence;
And then, after obtaining the licence, and within a further one year period:
- sign a community agreement in the form set out in the regulations (2010 Law, Art. 30.2);
- prepare a rehabilitation and closure plan and obtain the approval of the committee of rehabilitation and closure as prescribed in the regulation (2010 Law, Art. 30.3);
- prepare a plan for an environmental impact assessment as prescribed in the regulation and obtain the approval of the same from the Environment Protection Authority (2010 Law, Art. 30.4).
The holder of the licence is entitled to use surface rights in respect of its operations provided compensation is made.
See Yemen Environmental Regulation.