Uganda sets up state-owned firm to take stakes in mining operations

Ionic Rare Earths

02/10/2024 06:17

KAMPALA, Oct 2 (Reuters) - Uganda has formed a
state-owned mining company to manage the government's equity
interests in mining operations, its minister for energy and
mineral development, Ruth Nankabirwa, said. 
    All mining activities in the east African country have
previously been done by private firms after obtaining
exploration and mining licenses.
    Under a new mining law approved in 2022, the government can
compulsorily take a 15% free carry stake in all mining
operations in the country. 
    The move is part of broader efforts to expand Uganda's share
of the value from its mineral wealth, following in the footsteps
of other African countries such as Tanzania.  
    "This company will manage the state's commercial interests
in the mining industry. It will do so through strategic
partnerships with young developers in the private sector,"
Nankabirwa told a mining conference in Kampala on Tuesday. 
    President Yoweri Museveni's government has also been pushing
investors in the sector to process minerals and add value
domestically instead of exporting them in raw form.  
    In April, Uganda launched its first tin refining company by
mining firm Woodcross resources, which refines tin ore to 99.9%
purity. 
    Chinese-backed Sunbird Resources has also been licensed to
mine limestone for cement production in Karamoja region in
Uganda's northeast region, while Australia's Ionic Rare Earths
 IXR.AX  has been licensed to mine and process rare earths.  
    Ugandan geologists say the country has large deposits of a
range of minerals including gold, cobalt, copper, iron ore, rare
earths, among others.  

 (Reporting by Elias Biryabarema; Editing by George Obulutsa and
Rashmi Aich)
 ((Email:elias.biryabarema@thomsonreuters.com; Tel. +254 20 499
1232; Reuters Messaging:
elias.biryabarema.thomsonreuters.com@reuters.net))