Politics and policy

Base Titanium makes first shipment

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Mining secretary Najib Balala (left) and Base Titanium general manager Joe Schwarz arrive at the firm’s jetty in Likoni to launch the first export consignment of 25,000 tonnes of titanium ore to China on Thursday. Photo/Laban  Walloga

Mining secretary Najib Balala (left) and Base Titanium general manager Joe Schwarz arrive at the firm’s jetty in Likoni to launch the first export consignment of 25,000 tonnes of titanium ore to China on Thursday. Photo/Laban Walloga 

By BOZO JENJE, bjenje@ke.nationmedia.com

Posted  Thursday, February 13   2014 at  19:52

In Summary

  • The 25,000 tonnes of titanium ore are headed for China.
  • Mining secretary Najib Balala said a misunderstanding between the government, the community and the company, which delayed the shipments by 18 years, had been resolved through negotiations.
  • Mr Balala said the government had supported the investment through a Sh1 billion compensation plan to the community and taxation waivers.

Base Titanium will ship out 25,000 tonnes of titanium ore to China Friday, only a day after it was granted an export licence by the government.

The Ilmenite export cargo will be shipped aboard MV African Eagle to DuPont Titanium Technologies, a manufacturer of titanium dioxide pigment for white paints.

Mining secretary Najib Balala said a misunderstanding between the government, the community and the company, which delayed the shipments by 18 years, had been resolved through negotiations.

“We are witnessing today’s export as we launch the shipment in this partnership between government and private sector,” said Mr Balala.

The licence issued Thursday is valid for two weeks and each shipment requires a new export permit. Mr Balala said the government had supported the investment through a Sh1 billion compensation plan to the community and taxation waivers.

“The government provided 4,250 acres of land to enable this capital investment partnership to be realised despite many challenges at the start of the Sh35 billion  investment,” the minister said.

Base Titanium, a subsidiary of Australian Base Resources, estimates the Kwale project will produce 340,000 tonnes of ilmenite (about 10 per cent of the global supply), 80,000 tonnes of rutile and 30,000 tonnes of zircon annually.

Base Titanium expects to earn about Sh130 billion and the government Sh18 billion in tax and royalties during the life of the mine.

Mr Balala said negotiations were ongoing with the company over the increase in royalties from three per cent to 10 per cent as proposed in the Mining Bill.

Base Titanium general manager for external affairs development Joe Schwarz said the export was significant to Kenya since it marked the beginning for the country to earn additional foreign currency.

He said titanium ore combined with other minerals would lift mining to the fourth biggest earner of foreign exchange.

Australian High Commissioner to Kenya Geoff Tooth said the exports would interest other global investors in opportunities in Kenya’s mining sector.