State will not venture into mining – Mwakwere

November 17, 2011

, NAIROBI, Kenya, Nov 17 – The government has ruled out nationalising mining activities in the country despite increased exploration.

The Ministry of Trade says it will instead invite and partner with investors seeking to tap into the country’s mineral resources.

Trade Minister Minster Chirau Ali Mwakwere on Thursday said the ministry was working on a policy that will allow the sector maximise returns while still providing a conducive environment for the mining industry.

“We are inviting foreign private investors and the role of the government is to give facilitation to ensure that they invest with greater confidence, not put our own resources in the mining business,” Mwakwere said.

The government plays a passive role in mining activities in the country only supervising exploration and collection of revenues.

Kenya is chiefly known for its production of fluorspar, gemstones, soapstone, and soda ash with rising interest in gold, copper and zinc in an area covering 2,888 square kilometres in Western Kenya.

This has led to renewed interest in the country’s mineral resources that has seen a number of international firms set up shop in Kenya. In 2010, the Aviva Corporation acquired an interest in the Bumbo base metal prospect in West Kenya through a joint venture with AfriOre International.

Rock and Stock Investments is another firm that has set up a regional office in Kenya providing consulting services to explorers coming to Kenya.

Rock and Stock Consulting geologist Joshua Hattingh said the firm is currently preparing geology and feasibility studies in Kisumu over rising interest in the gold belt that exists in the region.

“We are currently in the fields right now and our work makes it easier for the miners to know what sort of minerals and what quantities exists in a certain region. Right now, there are signs of a lot of base metals and gold deposits that mining companies would be interested in,” Hattingh said.

Of concern however to most mining companies was the low level of infrastructure to support their investment in the country.

Mwakwere took cognisance of the lack of proper infrastructure especially in energy required to develop the industry further, and said the government is working on improving its power generation capacity to make mining more attractive.

“The government is well aware of this and a lot of investment is being made in infrastructure right from roads to power. Right now it’s not a problem given the number of companies involved, it is however a projected problem if we don’t do something about it down the line,” Mwakwere said.

More than 10 international mining firms have intensified their operations in western Kenya, which mining experts say could experience a real gold rush in the next 10 years.

Companies like Josich International who have mining operations in Tanzania and Kenya are among the recent entrants. Others are Africa Queens Mines, a Canadian resource exploratory firm; Goldplat and Mid Migori Mining Company, a subsidiary of Red Rock Resources.

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