Proposed reforms could simplify artisanal mining rules and pave the way for gold tourism.
Kazakhstan is once again considering reforms to its artisanal mining framework. Industry representatives are proposing to simplify the licensing process, expand access to eligible mining areas, and create conditions for the development of so-called gold tourism. According to experts, these measures could help legalize a portion of small-scale gold production, encourage entrepreneurship, and stimulate regional economic development.
Kanat Baitov, Executive Director of the Dragmet Association, and Serik Nurgazin, Head of the Union of Independent Prospectors, believe that renewed interest in the issue is driven by several factors. Demand remains strong for the extraction of precious metals from small deposits that are not economically attractive to large-scale mining companies. At the same time, advances in mining technology have made the development of small placer gold deposits more accessible to entrepreneurs.
To discuss the contribution of artisanal mining to Kazakhstan's economy and whether it could serve as a foundation for a new tourism segment, inbusiness.kz spoke with Said Sultanov, Founder of Aurora Minerals Group.
– Said, let's begin with the question of why artisanal mining has once again become a topical issue in Kazakhstan.
– In Kazakhstan, renewed interest in artisanal mining can be attributed to several factors.
First, there is sustained demand for the extraction of gold and other precious metals from deposits that are too small or uneconomic to attract the interest of major mining companies.
Second, technological advances have made artisanal mining significantly more accessible. Small enterprises and individual entrepreneurs are now able to develop small placer gold deposits efficiently without requiring substantial capital investment. This creates opportunities for regional economic development and job creation.
Third, the continued rise in global gold prices has significantly improved the economic viability and attractiveness of artisanal gold mining.
– Have the regulations introduced in 2018 truly become outdated? If so, why?
– With regard to the provisions introduced in 2018 under Kazakhstan's new Subsoil and Subsoil Use Code, I would not say they have become outdated. On the contrary, they marked an important step toward improving access to mineral resources through the "first come, first served" principle. However, several years of practical implementation have revealed a number of challenges.
The process of obtaining an artisanal mining licence is still perceived by many entrepreneurs as overly complex. There are ongoing issues related to land allocation approvals and environmental compliance requirements. In addition, the balance between simplifying access to subsoil use rights and ensuring effective environmental oversight has not always been achieved. As a result, a number of prospective areas remain undeveloped due to administrative barriers.
Therefore, the current discussion is not about replacing the 2018 regulations, but rather about refining them based on practical experience. The government's objective is to strike a balance between three key priorities: encouraging mineral resource development, increasing tax revenues, and ensuring environmental protection.
The industry has proposed several improvements, including increasing the maximum size of an artisanal mining licence area from the current 5 hectares to 15 hectares, expanding the permissible depth of exploration and mining activities, and streamlining administrative procedures.
It is particularly noteworthy that, in some cases, obtaining a mining licence for solid minerals has become faster and more straightforward than obtaining an artisanal mining licence, even though artisanal mining was originally intended to be the most accessible form of subsoil use.
– In your view, what has artisanal mining brought to Kazakhstan over the years? What have been its main benefits and shortcomings?
– Among its key benefits are the establishment of a legal framework for small-scale gold mining, greater participation of local communities and small businesses in the subsoil use sector, the promotion of entrepreneurship in remote regions, the creation of an additional mechanism for geological prospecting, and new employment opportunities.
At the same time, several significant challenges have become apparent. These include a high barrier to entry due to financial guarantee requirements, the limited size of licence areas, complex administrative procedures, the insufficient economic viability of many prospective sites, and the lack of transparent marketing channels for the sale of recovered gold.
Perhaps the clearest indicator of these shortcomings is the fact that, according to figures cited by industry participants, since the introduction of the artisanal mining framework, virtually not a single gram of gold has been officially delivered by artisanal miners to refining facilities. This points to systemic issues in the regulation of the sector and suggests that the existing framework has yet to achieve its intended objectives.
– Has the legalization of artisanal mining helped reduce the impact of illegal gold mining?
– To some extent, yes, but it has not delivered the results that were originally expected. The underlying concept was sound: to provide individuals with a legal pathway to mine gold instead of operating illegally. However, when legal operations are more complex, more expensive, and less profitable than illegal ones, some participants inevitably remain in the informal sector.
It is therefore fair to say that legalization has established the foundation for addressing illegal mining, but it has not, on its own, solved the problem. Achieving that will require making the legal framework more economically attractive and commercially viable for artisanal miners.
– Could expanding artisanal mining create conflicts with companies that already hold mining or exploration licences?
– Such risks do exist, but they are manageable. Conflicts may arise where interests overlap on prospective mineralized areas or where the boundaries between different categories of subsoil use rights are not clearly defined. However, Kazakhstan's Subsoil Code already provides mechanisms for allocating licence areas and regulating access to mineral resources.
In practice, artisanal miners typically operate on small-scale deposits, residual placer occurrences, or areas that are not economically attractive to larger mining companies. With effective planning and clear regulatory oversight, potential conflicts can be minimized. Moreover, in several mining jurisdictions around the world, artisanal miners and large-scale mining companies successfully coexist within a single mineral resource management framework.
– Does Kazakhstan have sufficient areas suitable for small-scale artisanal mining?
– While there is limited publicly available up-to-date data on the number of areas suitable for artisanal mining, industry experts agree that Kazakhstan has considerable potential. The most prospective targets include placer gold deposits and smaller mineral occurrences that are not economically attractive to large-scale mining companies.
This is one of the reasons why the industry is proposing to increase the maximum size of an artisanal mining licence area from the current 5 hectares to 15 hectares. Under the existing limits, many deposits cannot be developed efficiently or on a commercially viable basis.
– In your opinion, what could gold tourism look like in Kazakhstan?
– Gold tourism in Kazakhstan could take several forms. These might include recreational gold panning under the supervision of qualified instructors, visits to historic gold mining sites, guided tours of active mining operations, geological field excursions, educational programmes for school and university students, as well as family-oriented and adventure tourism experiences.
Kazakhstan has every opportunity to develop its own version of the successful gold tourism destinations that already exist in a number of mining jurisdictions around the world.
– Who would be the target audience for this type of tourism?
– The potential audience is quite broad. It includes domestic tourists, families with children, outdoor enthusiasts, students studying geology and mining, international visitors, and people interested in industrial heritage and historical tourism.
In particular, this type of experience is likely to appeal to those who are drawn to the excitement and romance of searching for gold.
– What might such a tour look like in practice?
– A typical itinerary could include arrival at the site, a mandatory health and safety briefing, an introduction to the history and geology of the deposit, practical instruction in gold panning techniques, followed by participants carrying out their own gold panning activities and concluding with an opportunity to examine the gold they have recovered.
The question of whether participants should be permitted to retain any gold they recover would require separate legal regulation under Kazakhstan's legislation.
– Which regions of Kazakhstan have the greatest potential for developing gold tourism?
– The most promising regions are those with a long history of gold mining, including the Akmola, Abai, East Kazakhstan, Karaganda, and Pavlodar regions. Areas surrounding historic gold mining centres and former placer mining operations could be particularly attractive destinations for this type of tourism.
– Could the romance of a modern-day gold rush ultimately result in litter, conflicts, and environmental degradation?
– Such a scenario is possible if there is insufficient oversight. However, the problem is not artisanal mining itself—it is the effectiveness of the regulatory framework. With clear rules, well-defined environmental responsibilities, effective land rehabilitation requirements, and proper regulatory oversight, the potential environmental impacts can be minimized.
At the same time, many industry participants consider the current system of financial security for mine closure and environmental rehabilitation to be excessively burdensome. The challenge for the government is therefore to strike an appropriate balance between ensuring environmental responsibility and maintaining the economic viability and accessibility of artisanal mining.
– Who ultimately stands to benefit from these reforms?
– If the regulatory framework is designed effectively, all stakeholders stand to benefit. Citizens would gain the opportunity to engage legally in artisanal mining and entrepreneurial activities. The regions would benefit from new jobs, the growth of small businesses, and increased tourism. The government would see greater transparency in the gold market, higher tax revenues, and a reduction in illegal mining. At the same time, the private sector would gain new opportunities to invest in small-scale mining projects and tourism-related services.
However, achieving these outcomes will require addressing the key barriers consistently identified by artisanal miners themselves. These include reducing the financial burden associated with mine closure and environmental rehabilitation guarantees, expanding the maximum size of licence areas, streamlining licensing procedures, and establishing a transparent and officially regulated market for the sale of recovered gold.
At present, the situation remains somewhat paradoxical. While the government has introduced a legal framework for artisanal mining, the operating conditions are, in many cases, still so complex that some participants continue to rely on informal channels for marketing their gold. Whether this issue can be effectively resolved will largely determine whether artisanal mining develops into a successful and sustainable sector of the economy or remains a niche experiment.
