Companies

Base Titanium lifts living standards in South Coast

For years, Bakari Juma, a resident of Maumba in Kwale County has been selling mangoes and chickens to hotel establishments in Diani, a market that was saturated by other traders, besides being affected by the usual low tourist seasons.

Then late last year, a community buying centre was set up in a partnership between Africa Eco Safari, a catering firm and Base Titanium, a mining company.

Each Tuesday, residents sell their grocery to the caterer who supplies food to people working at the mining site. Hotel owners are also invited to buy their supplies.

Mr Juma says since the centre was set up, he has been able to sell more chickens and mangoes.  

“Life has changed for us here because initially we did not have market for our produce, but every Tuesday I can go home with not less than Sh3,000 which is a big boost,” he says.

The initiative has also benefited the catering company by cutting costs.

Projects

“Most of the farm produce hoteliers use in the South Coast has over the years been sourced from Kongowea market in Mombasa. Here, we are buying the produce from farmers at the prevailing prices,” Anwar Asad, managing director Africa Eco Safaris said recently, adding that the cafeteria alone buys groceries worth more than Sh120,000 every week.

Two months ago, before the opening of Magaoni Health Centre at Maumba village, Mwanaisha Salim used to travel to Msambweni, a distance of about 15 km to access healthcare.

The mother of three says by the time she got to the clinic, she would be so tired that after treatment she would sleep on the veranda, too exhausted to travel back home.

“It was terrible. I would take a nap and by the time I woke up it would be four o’clock. At times I would stay at home if I did not have money and use a cocktail of herbs, especially to treat malaria,” she says.

The new health centre has, however, changed her life.

“I just walk in when I am sick and get treatment free of charge. I don’t need to travel since my home is just a couple of metres from here,” she says, adding that the problem of water for domestic use is a thing of the past because water taps dot the entire village, placed at strategic points.

Mr Juma and Ms Mwanaisha are not the only residents of Maumba who have benefited from health centres, water supply, tarmacked roads, a brand new secondary school and a community buying centre built by Base Titanium, a mining company which started extracting minerals in Kwale County last October.

“With a 13-year mining lease, we are already thinking ahead on the kind of projects that will benefit the community,” says Mr Colin Forbes, the company’s general manager for environment and community affairs.

“Our focus also is to create a linkage for market.”

Base Titanium acquired mining rights from Titanium Mining Company in 2010 and started actual mining in October last year.

External affairs manager Simon Wall says the company has spent more than Sh300 million on the community over the past three years, and has budgeted Sh348 million this financial year.

“During two and a half years of construction, we employed 2,200 people and currently have a workforce of 880 workers. We have commissioned a survey to try and establish how many people are indirectly benefiting from our mining activities,” he says.

So far, the company has extracted 165,352 tonnes of Ilmenite, 24,216 tonnes of rutile and 4,489 tonnes of zircon and shipped 139,119 tonnes, 14,005 tonnes and 2,704 tonnes of each mineral respectively.

The three minerals are the major extracts from the ore mined using open cast method with the metals provide raw materials in the manufacture of paint pigments.

The biggest market is in China but the minerals are also exported to the US and some parts of Europe, according to Mr Wall.

READ: Base Resources Kwale mine set for more exports

During the 13 years of the lease, Base Titanium will mine 330,000 tonnes of ilmenite, 80,000 tonnes of rutile and 30,000 tonnes of zircon each year with an annual expenditure of $16 million (Sh1.3 billion) in its operations and $310 million (Sh27 billion) as the total investment in the project.

Mr Wall says prices of the three minerals in the international market vary, with zircon and rutile being the most pricy, going for between $800 (Sh70,960) and $1,000 (Sh88,700) per tonne while ilmenite sells at $150 (Sh13,305) per tonne.

The company expects to earn about Sh130 billion and pay the government Sh18 billion in tax and royalties during the life of the mine.

Perhaps these are the kind of figures that saw Kwale county government impose a mining levy of Sh5,000 per tonne, which Mr Wall says is unconstitutional and based on figures that were not realistic since the county officials did not base their rates on value of any of the minerals.

Further, minerals and natural resources is yet to be devolved to counties and remains a function of the national government.

“At the moment, the bulk of exports comprise ilmenite, which does not fetch much in the world market. The cost of production ranges between $142 (Sh12,595) to $145 (Sh12,661) per tonne so it does not make sense to pay the levy at that rate since we also need to pay back our financiers,” he says, adding that they were negotiating with the county to reach an agreement over the rates.    

One of the most controversial issues in mining is the environment, and according to Mr Wall, the company has addressed this by using modern technology to extract the minerals.

“We don’t use any chemicals in the extraction but utilise electricity, water and magnetism,” he says.

Concerning rehabilitation of the 4,000 acres of land in the mining area after the 13 years, Mr Forbes says a potato and cotton growing pilot project the firm has initiated will see farmers around the area grow the crops and serve as the mine’s “closure plan”.

“We have set aside $600,000 (Sh53.2 million) for the project, which also incorporates poultry. By the end of the mining we expect that after rehabilitation the land will be used for various agricultural purposes,” he says.   

Currently, the potato and cotton pilot project is on a 10-acre farm and Mr Forbes hopes that at the end of the trial, local residents will embark on large-scale farming of the crops.

“We have been bringing farmers here to show them how it is done. There has been an argument that potatoes cannot grow in Kwale and we want to show them that it can be done. There is a ready market for potatoes and we are sure we will get a ready market,” he says.

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