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The Potential of Mining Sector in Malaysia


The mining industry in Malaysia is not the big business it used to be due to the collapse of the global tin market in 1985. The industry was then overshadowed by industrialisation, the oil palm industry and the oil and gas industry.

Apart from oil and gas, minerals are being mined by small-time miners in a rather ambiguous manner in most mineral-rich states, but that is about to change!

The sector is now focusing on large-scale mining of major minerals such as gold, iron ore and coal which is no longer the domain of tin.

In year 2012, iron ore was the top in terms of production amongst other major minerals with 10.7 million tonnes mined valued at RM2.02bil, which is followed by gold with 4.6 million gm (RM700.8mil), coal at 2.95 million tonnes (RM442.2mil) and tin-in-concentrate at 3.66 million tonnes (RM236.5mil) respectively.

“The past decades of lull in the mining industry had resulted in the slowing down of supplies in metals. The imbalance in the supply-demand curve thus pushes prices up, encouraging the exploration and development of new mining projects.

“This is perhaps the most exciting time in the history of the mining industry,” says Malaysian Chamber of Mines (MCOM) executive director Muhamad Nor Muhamad.



In recent years, there has been strong involvement by foreign investors, either indirectly or via strategic joint ventures with locals. There are now 98 iron ore mines, 15 gold mines, 14 tin mines and seven coal mines in operation in the country.

Despite the encouraging growth in the mining sector, many feel that the disclosure over the grants of mining leases, concessions, exploration permits as well as the scale of existing mining companies’ operations, profitability, mining royalty and taxes still lack transparency. Details are strictly kept from the eye of the public. There have also been complaints by prospective mining investors over the long waiting period for approval of applications for mining leases or concessions at state level.

According to mining experts, the top three mining-friendly states are Pahang, Perak and Kelantan, and followed by Johor, Terengganu and Kedah.

Meanwhile, Malaysian Chamber of Mines (MCOM) president Datuk Seri Dr Mohd Ajib Anuar points out that Malaysia still holds the attraction as a good mining investment destination even though the country “has never been a major mining country compared with Australia, Indonesia, the Philippines and Vietnam”, due to the complete and transparent mineral policy, law and regulations pertaining to exploration and mining development. Easy access to facilities such as water, electricity and roads makes mining less costly in the country has also on the other hand contributes to the growth of the mining industry.








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