(Nairobi) – Kenya’s mining industry is facing a significant setback as dealers in precious metals are left with more than 42,310 metric tonnes of stockpiled minerals, including copper, chromite, and beryllium, following the government’s decision to classify certain minerals as strategic. This move has transferred control of the exploration, mining, and trade of these minerals to the state.
A recent industry inventory submitted to the State Department for Mining shows that copper accounts for the bulk of the stockpile, with 39,720 tonnes or more than 94% of the total. The Kenya Chamber of Mines (KCM), an industry lobby group, has voiced concerns over the decision, claiming that the government ignored requests to delay the freeze on mineral dealings until December 2024.
Patrick Kanyoro, the chairman of KCM, expressed frustration over the sudden policy shift, saying that many industry players had made business decisions based on existing licenses and legal frameworks. “People have obligations to banks, landowners, and customers based on agreements,” Kanyoro said. “This sudden change makes it feel like a simple switch of the light on and off.”
The government’s decision to declare certain minerals as strategic is part of a broader policy shift aimed at better controlling the country’s mineral wealth. The National Mining Corporation (Namico) now holds the responsibility for exploring and dealing in these strategic minerals, either independently or through partnerships with companies that have the necessary technical and financial capacity.
The reclassification of minerals as strategic was one of the conditions set by President William Ruto’s administration when lifting the blanket ban on mining licenses in December 2019. While the ban’s lifting allowed for the issuance of permits for 56 industrial and construction minerals, the government has imposed strict regulations on strategic minerals, requiring approvals to be granted on a case-by-case basis.
The stockpiles of these minerals include large quantities of copper, chromite, beryllium, and tsavorite gemstones, which are held by various companies across Kenya. Notably, Beta Metal, operating in Migori and Kitui, has the largest stockpile, with 14,000 tonnes of copper, followed by Reliques Africa Ltd with 12,000 tonnes. Other companies, including Highsisal Investments, Madini Logistics, and Amuca Company, hold smaller amounts.
Among the other minerals listed are chromite and beryllium, with Amuca also holding significant quantities of these strategic minerals. In addition, companies like David Visram, based in Mombasa, are seeking ways to unlock value from their tsavorite gemstone stockpiles.
According to Kanyoro, the government sent officers multiple times to verify the stockpiles, as the authorities were initially distrustful of the figures provided. “They could not trust what we were telling them,” he said.
The KCM chairman also discussed the difficulty of estimating the value of the stockpiles, particularly for ore, which requires sampling, assaying, crushing, and blending to determine its worth. For gemstones, factors such as color, clarity, and carat weight further complicate the valuation process.
Kenya’s reclassification of minerals as strategic includes cobalt, graphite, copper, tantalum, lithium, niobium, coltan, nickel, tin, uranium, thorium, tsavorite, and rare earth minerals. The government has made it clear that holders of mineral rights who encounter these strategic minerals must report the discovery to the Ministry of Mining immediately.
However, the KCM has raised concerns over the lack of public participation in the decision-making process. Kanyoro emphasized that industry stakeholders were not consulted before the government implemented the new regulations, leaving them with limited options for navigating the changes.
In an interview, Principal Secretary for Mining Elijah Mwangi responded to these concerns, noting that the government is open to discussing any issues related to the new regulations. He highlighted that the strategic minerals policy is designed to protect national interests in the exploitation of valuable mineral resources.