Dealers in precious minerals such as copper, which the government declared strategic last year, are seeking a transition window to export them to recoup millions of shillings in investments and pay debts to contractors, suppliers, and creditors.
In a letter to Mining Cabinet secretary Hassan Joho, the dealers are pleading for more time to clear stocks before the tighter rules governing licences and permits of more than a dozen minerals are enforced.
The Kenya Chamber of Mines, a lobby for industry players, claims in the letter that Mr Joho’s predecessor Salim Mvurya had “committed to granting a window of six months [though the industry had requested 12 months] to facilitate mineral dealers that accumulated stockpiles while holding valid dealer licences export the same”.
The letter, received by Mr Joho’s office on September 12, further claims Mr Mvurya had pledged to propose to the Cabinet to revisit the matter.
“This was specifically requested to facilitate mineral dealers that were in operation and licensed before the decision to have the list of mineral as strategic and who holds stocks of copper, tsavorite, beryllium, etc,” says the letter signed by KCM chief executive Joseph Learamo.
“This window will facilitate the dealers redeem their investments, meet their contractual obligations with markets/buyers, and ensure communities across the counties will continue to generate income to sustain their livelihoods.” the letter seen by the Business Daily further said.
Mr Learamo attached the minutes of the meeting that took place on July 11—the day President William Ruto dismissed his entire Cabinet except his deputy and minister for Foreign Affairs—to support the claims.
The decision to classify some minerals as strategic to the country was part of the conditions President Ruto’s administration set for lifting a blanket December 2019 moratorium on issuance of prospecting, mining, and dealing in minerals.
While the ban on issuance of permits and licences for 56 industrial and construction minerals was fully lifted last October, prospecting and extraction of strategic minerals are being approved on a case-by-case basis guided by Mining (Strategic Minerals) Regulations 2017.
The regulations place the responsibility to explore and mine strategic minerals or deposits in the hands of the National Mining Corporation, which may do so on its own or through a partnership with a company that has requisite technical and financial capacity.
Minerals that Kenya has declared as strategic are cobalt, graphite, copper, tantalum, lithium, niobium, coltan, nickel, and tin. Others are radioactive minerals such as uranium and thorium, tsavorite, rare earth minerals, and chromite.
Holders of minerals rights who encounter the strategic minerals they are not permitted to explore or mine, are required to “immediately” report the discovery to the Cabinet secretary for mining.
Section 31(d) of the Mining Act 2016 requires Mining CS powers to advise and seek approval from the Cabinet to declare certain minerals or mineral deposits as strategic, while Section 31(d) of the same law allows the Mineral Rights Board to recommend to the CS to declare certain minerals strategic.
KCM, however, says the policy was reached without public participation.
“Being strategic means the government has an interest in the exploitation of those minerals. We communicated to stakeholders after the gazette notice on October 23,” Principal Secretary for Mining Elijah Mwangi said in an interview on September 19.
“Anybody who has a concern about our regulations and the way we are handling the licences, we are very much open and there to explain to them.”
The country is believed to hold significant deposits of copper, coltan, niobium, manganese, and rare earth minerals which largely remain under-exploited, dwarfing the mining sector’s contribution to the national economic output.
“We are committed to walking this journey together because our responsibility is to support those who are in mining. But more key is to ensure that the minerals that belong to the people of Kenya, in which we are trustees, do not go to waste,” Mr Mwangi said.
The government is banking on ongoing reforms to gradually unlock the sector’s revenue potential, conservatively estimated at about $6.6 billion (about Sh851.4 billion under the prevailing dollar conversion rate).
