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Monday, December 16, 2013 

Ugandan miners eye $5b bonanza

Mining in Uganda has mostly been dominated by small operations that lack sufficient capital to fully exploit the ore.


BUGIRI, Uganda – Gold miners and prospectors in eastern Uganda say the country can earn between  $2.5 billnio and $5 billion from exploiting the precious metal in Bugiri and Namayingo districts.

The miners during a meeting with local leaders said they are going to invest  $100 million into the exploration and eventual mining of gold in the districts over the next seven years to reach this target.

Ghanaian firm Blaze Metals Resources Ashanti Ltd together with Lynks FZC and Amor Mines Limited hold licenses to explore for gold in the districts under the Bugiri Exploration Programme.

Their objective is to prospect, explore for produce, exploit, refine, process, manufacture products and bi-product, distribute, supply and otherwise deal in gold.

They are to identify, add-value, and promote areas of heightened economic mineral potential to known or responsible investors and National policy makers.

The miners recently met district leaders from the two districts during a community sensitization workshop to familiarize them with their exploration programme and also their long term plans for the development of the license areas.

The two districts form part of a larger Busoga region which is gifted with a number of minerals including gold which are yet to be tapped.

The region has started to attract investors and government attention to spearhead minerals adventure that will stimulate the country’s economy and livelihoods of the local people.

Despite evident existence of gold in the two districts exploration and subsequent mining has never taken off living the mineral in the hands of local small-scale miners.

While addressing leaders, Prince Opoku, the Operations Director for Blaze Metal Resources Ashanti said they are currently looking for gold estimated to be in the region of 2 million ounces in the license area.

The three firms under the joint venture hold exploration licenses in the two districts amounting to 60 square kilometers.

“The 2 million ounces is our exploration target but there could be more gold and that is the reason we will invest $100m over the next seven years to reach this target,” Opoku said.

John Onyango, the managing Director of Amor Mines who is also a resident in one of the sub counties of Bugiri and has been following the developments regarding gold in the area said once fully exploited the mineral can earn the country $5billions.

Minerals’ excavating is a sensitive issue which requires the involvement of local people who usually own the land under which the minerals are deposited.

For that matter a mutual and health relationship between the miners and land owners is vital in the process of developing the sector.

  “As we undertake exploration, activities like blasting, trenching and excavating among others will be carried out.  These activities will create interruptions; affecting the daily lives of the people in the communities where we will work hence the need to sensitize the local leaders first,” Opoku said.

In the meeting, some of the local leaders wanted to know how they will benefit from the gold extraction.

Some of the leaders raised worrying concerns including the issue of compensation, employment, health risks and how the miners will relate with the existing small-scale miners.

In a response, Onyango, explained that the new miners will bring in new technology and expertise to dig up the gold and create capacity to employ over 1000 local youth at different level of production chain.

“As people of Bugiri and Namayingo this is an opportunity to get gold out of the ground. We need to work with these people because this programme will create employment for our youth some of whom are losing lives illegally mining gold,”Onyango appealed to the leaders.

Wilber Obondo Waiswa, Namayingo LC V chairman explained that local government has been losing revenue since the small-scale miner never pays taxes.

“It means we will get local taxes and new jobs will be created and on the whole, the economies of our districts will be transformed the same way oil is transforming the Bunyoro region.” Waiswa said.

Onyango of Amor Mines said the joint venture partnership will not eliminate the small scale miners but will guarantee them work at the location stage instead.

The company plans to employ and train young recent graduates in the procedures of field sampling surveys, data interpretation and presentation, budget handling and project management.

 They also plans on hiring some Ugandan geologists from the Department of Geological Survey and Mines to be involved in the project activities, from a capacity-enhancement perspective. 

By Baz Waiswa, Monday, December 16th, 2013