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Singapore has potential to become key hub for mining: Industry players

SINGAPORE — Some industry players believe that Singapore has the potential to become a key hub for the global mining industry, although it neither has coal mines nor is a source of precious stones like rubies.

A mine in Western Australia. Reuters file photo

A mine in Western Australia. Reuters file photo

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SINGAPORE — Some industry players believe that Singapore has the potential to become a key hub for the global mining industry, although it neither has coal mines nor is a source of precious stones like rubies.

Experts said the Republic is in a good position to tap the growth of the mining business in Asia and beyond, given that it is situated at the crossroads of metals and minerals supply in Asia Pacific. Firms in Singapore are also already providing a wide range of crucial services for mining firms, from financing projects to the sale and marketing of commodities such as coal and gold.

The Economic Development Board said the world’s top five mining companies — including BHP Billiton, Rio Tinto, and Vale — have set up regional operations in the Republic, and the industry now comprises over 300 companies and provides over 10,000 jobs.

Mr Sebastian Jones, vice president of the Singapore Mining Club, said Singapore benefits from “very favourable” corporate and individual tax regimes. “It is also very well-located geographically, very close to key mining regions including Australia, Indonesia, mainland China and everything in between,” he added.

While Singapore is better known as a hub for oil and gas as well as for trading commodities, the Singapore Mining Club said many mining firms are now using Singapore as a base for fund raising.

Earlier this year, Australian company Roy Hill raised US$7.2 billion (S$9.47 billion) of funding in Singapore for its iron ore mining project located in West Australia’s Pilbara region. This is seen as one of the largest ever project financings in the mining sector.

IE Singapore’s Global Trader Programme, which attracts trading companies to Singapore, is one of the initiatives over the years to boost the size of the industry. As activity grows, there are spillover effects on others sectors, including law.

Mr Brian Gordon, president of the Singapore Mining Club, called this situation a “self-perpetuating business”. He said: “The more deals, lawyers and bankers you command, the more accounts and corporate finances there are. As a result, they generate more work for all of us. It is a highly-regulated area that has a lot of risk, and naturally, you will find lawyers trying to mitigate that risk for investors or producers.”

The Singapore Mining Club said it is looking to provide better local access to international companies, and help equip local law firms with technical know-how regarding the general risk associated with mining transactions. CHANNEL NEWSASIA

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