Ministry to draft Bill to define use of royalties from mining activities

Written By: Regina Manyara- Gitau
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the government has embarked on a nationwide geo-mapping survey to establish mineral deposits

Mining Ministry targets to draft Sovereign Wealth Bill to define how royalties earned from mining activities will be utilized.

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Speaking at Kenya Broadcasting Corporation offices, Mining Principal Secretary John Morangi said this will go a long way in boosting the sector’s output as well as provide safety and security for communities where the activities take place.

The Mining Act 2016 stipulates that holders of a mineral right shall pay the royalties to the state which is determined by gross value of the total sales.

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The act also allocates 70% of royalties to the national government, 20% to county government and 10% to the community where mining operations take place.

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Mining Principal Secretary John Morangi says a sovereign wealth bill will guide fair utilization of royalties among beneficiaries.

In total, Kenya has 77 minerals according to the Department of Mines, among them rubies, emerald and tsavorite – though in small quantities.

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The bill is also backed to ease tension between corporations and communities such Tata Chemicals and Kajiado county government, Base Titanium vs Kwale locals among others. Kenya’s gold exports declined to 471.98g in 2018 from 502.57g in 2017.

PS Morangi further called for a review of the tax regime on imports and exports of mineral products to make it favorable for local miners and traders as stiff competition emerges in the region with Uganda zero-rating all its gold trade and set up a refinery.

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The ministry has set up Rapid Response teams in mining counties to improve emerging response in the event of mining mishaps that have in the recent past claimed lives.

Plans are at an advanced stage to set a gold refinery plant in Kakamega to support gold mining in the western region.

 

 

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