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Mining firm to build Sh12.8bn factory

Prospecting equipment at Mrima Hill niobium mining site in Kwale County. Photo/FILE
Prospecting equipment at Mrima Hill niobium mining site in Kwale County. Photo/FILE 

Cortec Mining Kenya Ltd is set to build a factory in Mrima Hill in Kwale County for processing of niobium and other rare earths, bringing the Sh12.8 billion project closer to realisation.

The company, which was awarded a 21-year special mining licence in March, is seeking approval from environmental agencies to construct the plant.

Niobium is used to produce high strength low alloy (HSLA) as an additive to ordinary steel, increasing its strength while reducing its weight.

“The total plant area footprint measures approximately 460,000 metres squared. The plant will operate 24 hours per day, six days per week allowing one day per week for maintenance,” reads a statement by the National Environment Management Authority (Nema).

Cortec has undertaken exploratory drilling at Mrima Hill since it was issued with the licence and has confirmed 105 metric tonne mineral deposits in the area.

A report by Nema states that the current high grade niobium resource at Mrima Hill can be mined over 15 to 20 years. The deposit is considered world class and ranks amongst the top six in the world.

The opening of the plant will come as a major boost to the mining sector, which earlier received a blow with the announcement by Goldplat that it was closing its Western Kenya operations due to losses.

Currently, Brazil is the largest exporter of niobium accounting for more than 90 per cent of total global exports, followed by Canada.

Consumption of niobium in the world has been on the increase, especially in China which consumes almost 30 per cent of the global supply.

Cortec Mining is a subsidiary of Canadian company Pacific Wildcat Resources Corp (PAW), which is focused on a number of rare earth, tantalum and niobium projects in Africa.

Several firms are actively exploring for minerals at the Coast in a bid to ride on the increased global demand.

Australia’s Base Resources is mining for titanium in Kwale and expects to make its first shipment later this year. Base Resources expects the project’s annual production of titanium ore to include 330,000 tonnes of ilmenite and 80,000 tonnes of rutile and 40,000 tonnes of zircon mineral and the firm has started signing contracts with potential customers of titanium mineral to be produced in its Sh26 billion mining field.

Key ministry

The government has elevated mining from a departmental office to a full ministry, underlining the prospects of the industry.

Ministry head Najib Balala has identified the setting up of a new legislative structure as his key priority. There has been a standoff between the government and mining companies after the State passed a law that requires all mining companies to have local ownership of at least 35 per cent.

After setting up necessary legislation, the mining ministry will spend Sh5 billion to carry out geographical surveys aimed at identifying resources in the country and their quantities.

Other mineral resources prospected in the country include gold and coal. The country is also prospecting on the commercial viability of oil deposits discovered in northern Kenya.

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