Hope for Kwale mining after Ruto cabinet reverses Uhuru order

Base Titanium's hopes of expanding its operations in the country have received a shot in the arm after the national government lifted a moratorium on issuing new mining rights.

On Tuesday, the cabinet lifted the moratorium for 2019, paving the way for the issuance of prospecting licenses to miners.

Seven applications

Base Titanium's general manager for external affairs, Simon Wall, told the Nation that the company had so far submitted seven applications for prospecting licences and was awaiting government approval.

The Kwale-based company is relying on approvals to expand its operations in the country as it is experiencing a decline in mineral volumes due to the depletion of South Dune, its mining lease area, which is expected to close in March 2024.

"It is our hope that with the lifting of the moratorium, these applications can be considered and ultimately granted in accordance with the requirements of the Mining Act. Once granted, Base Titanium will be able to commence its stakeholder engagement activities and ultimately carry out exploration drilling," Mr Wall said.

On Tuesday, the Kenyan government lifted a moratorium that had halted the issuance of prospecting licences to allow for a fresh mapping of mineral resources across the country.

Economic potential

In its communique, the Cabinet said it had authorised a partial lifting of the moratorium to unlock the economic potential of the mining sector.

However, Cabinet insisted that the move must be accompanied by a more transparent and competitive licensing system.

Base Titanium described the government's move as a positive step that will open up opportunities for mining and have a positive trickle-down effect on communities and the country's economy.

“Lifting of the moratorium is an excellent start. The licensing process and the issuing of mineral rights is the backbone of the mining sector. Globally, approximately 1 in 1,000 exploration licences results in the development of a mine, so if we are to see mining playing a significant role in the Kenyan economy it is important to ensure that exploration drilling is taking place at a significant scale,” Mr Wall said.

In the year to June, the mineral sands miner had increased its spending on locally sourced materials by 14.93 percent to $66.2 million (Sh9.79 billion), benefiting suppliers of various goods.

Disclosures by its Australian-based parent company Base Resources showed that it had purchased $57.6 million (Sh8.5 billion) worth of goods from suppliers a year earlier.

During the period under review, the company's sales increased slightly by three percent to $271 million (Sh40.1 billion).
The Kenyan government was also hit by falling titanium ore volumes, collecting a total of Sh7.17 billion in royalties and taxes in the year to June 2023. This was a decline of 3.4 per cent from Sh7.42 billion in the previous year.

Base Titanium

Base Titanium has been mining and exporting the titanium minerals -- ilmenite, rutile and zircon -- in Kwale since October 2013, when it started operations.

Titanium minerals are important pigments for industrial, domestic and artistic applications. It is also a preferred material for joint replacements, dental implants and body piercing.