- Uganda is endowed with over 50 different types of minerals and it ranks among the countries in Africa with the biggest number of minerals although the potential for viable exploitation has not yet been established for most of the minerals.
- Mining currently contributes only 0.5 per cent to Gross Domestic Product. However, these are statistics for the formal sector. Informally, the contribution is 3.5 per cent. There are about 200,000 miners around the country, most of them unregulated.
- Recently government undertook geological, geochemical and airborne geophysical surveys covering 80% of the country that revealed potential for more mineral resources. Specifically, new targets for gold, iron ore and platinum group metals (PGMs), Rare Earth Elements (REEs), nickel-chromium, Uranium and a number of industrial minerals such as limestone among others. Government intends to develop these resources in partnership with private sector in a sustainable manner
The country’s list of minerals resources include;
Metallic mineral resources: Beryllium, Bismuth, Copper, Cobalt , Columbite-Tantalite (Coltan), Gold, Iron, Lead, Lithium, Manganese, Platinum Group of Metals (PGM), Rare Earth Elements (REE), Tin, Uranium, Wolfram and Zinc.
Industrial minerals: Bentonite, Clay, Diatomite, Dimension Stones (Granite), Feldspar, Glass sands, Graphite, Gypsum, Kaolin, Kyanite, Marble /limestone, Mica, Phosphate (Apatite), Pozzolana, Salt (rock salt, halite), Talc and Vermiculite.
Gemstones: Apatite, Beryl – emerald, aquamarine, heliodor, morganite,
Corundum (Ruby, blue sapphire), Fluorite, Garnet, Opal, Quartz
(amethyst, rose), Topaz, Tourmaline and Zircon
Regulatory framework
The Ministry of Energy and Mineral Development (MEMD)
MEMD is responsible for the sector, dealing specifically with mineral policy formulation, implementation and monitoring.
The mineral policy
The mineral policy constitutes a formal framework through which the mineral sector will develop within the national strategy for poverty eradication and development.
The Mineral Policy Objectives are:
1. To stimulate mining sector development by promoting private sector participation.
2. To ensure that mineral wealth supports national economic and social Development.
3. To regularise and improve artisanal and small scale mining.
4. To minimise and mitigate the adverse social and environmental impacts of mineral exploitation.
5. To remove restrictive practices on women participation in the mineral sector and protect children against mining hazards.
6. To develop and strengthen local capacity for mineral development.
7. To add value to mineral ores and increase mineral trade.
Mining Act
The Mining Act 2003 covers mineral ownership and rights, administration, licensing and leases, inspections, mineral trade and dealing, surface rights, cancellation and suspension of mineral rights, registration and records, environmental protections and financial and other provisions.
Mining regulations
The mining regulations were made on 2nd day of September, 2004 in exercise of the powers conferred upon the Minister by section 121 of the Mining Act, 2003.
Mining regulations help in applying for mining and related licenses in Uganda as well as for leases official certificates of work progress or approval.
Incentives in Mining Sector
Uganda Investment Authority (UIA)
- UIA is under Ministry of Finance & Economic Planning and Economic Development put in place an Investment Code, 1991.
- The Code encourages private investment by streamlining procedures and guaranteeing protection of investors against appropriation. Foreign individuals and companies – own 100% of a business in Uganda (Mining companies inclusive).
Taxation
- Import taxes such as customs duty for all mining equipment is zero-rated.
Mineral Certification
Uganda is in process to certify minerals, for example tin, tungsten and columbite-tantalite (3Ts) and gold in compliance with the Great Lakes initiative. When this process is accomplished, it will be able to trace minerals from mine sites and stages of trade among the Great Lakes member states subsequently will minimize conflicts in marketing of the country’s minerals.
- Environment: The mineral right holder is expected to Comply with National Environmental Management Act
- Royalties on gross value is charged as follows: Precious stones(5%); precious and base metals (5%); Industrial minerals quantity based.
- Revenues from royalty are shared by: Government (80%); Local Governments (17%); and Land Owner (3%).
Information available for investors in the mining sector
There are attractive incentives to investors because of growing appreciation of the minerals wealth of the country, settled business climate that has developed over the last 20 years, have led to increasing awareness by the international mining community of the actual and potential commercial development of gold, vermiculite, copper, cobalt, various specialty metals, and other minerals.
Mineral production by quantity
There was an increase in the production of Tin and Synthetic Aggregate and a decrease in the production of Limestone, Pozollana, Gold Vermicullite, Wolfram, Kaolin and Iron (Statistical Table 3.5.A.)
Table 3.5 A: Annual mineral Production by Quantity (Tonnes), 2011-2015
| Mineral | 2011 | 2012 | 2013 | 2014 | 2015 | |
| Non Metallic
Limestone |
932,348.2 |
936,264.0 |
922,371.8 |
1,090,240.3 |
979,660.1 |
|
| Pozollana | 690,910.6 | 650,323.8 | 623,470.6 | 742,423.1 | 686,563.8 | |
| Vermiculite | 7,960.4 | 51,961.8 | 2,296.6 | 2,660.8 | 800.5 | |
| Kaolin | 20,883.3 | 42,886.5 | 43,875.3 | 46,286.0 | 34,696.8 | |
| Metallic
Gold |
0.0005 |
0.0043 |
0.0045 |
0.0244 |
0.0127 |
|
| Cobalt** | 673.1 | 555.8 | 181.3 | 0.0 | 0.0 | |
| Crude cobalt carbonate | – | – | 566.7 | 0.0 | 0.0 | |
| Wolfram | 10.0 | 43.4 | 72.4 | 79.6 | 45.4 | |
| Synthetic Aggregate | 9,765.0 | 20,472.2 | 109,905.7 | 64,603.8 | 82,715.6 | |
| Iron Ore | 2,133.8 | 4,431.2 | 2,282.5 | 41,959.0 | 9,000.0 | |
| Coltan (30% Purity) | 0.01 | 0.00 | 0.00 | 0.00 | 0.37 | |
| Tin (75% Purity) | 0.01 | 0.00 | 25.62 | 44.50 | 180.30 | |
| Source: Ministry of Energy and Mineral Development
Mineral production by valueThe value of mineral production for selected minerals in Uganda from 2011 to 2015. The results show that there was a 13.2 percent decrease in the total value of the minerals produced from 168 billion shillings in 2014 to 146 billion shillings in 2015. (Statistical Table 3.5.B.) Table 3.5 B: Annual value of Mineral Production Value (UGX), 2011-2015 |
||||||
| Mineral
Non Metallic minerals Limestone |
2011
111,881,786 |
2012
112,351,639 |
2013 | 2014 | 2015 | |
|
110,684,618 |
130,828,831 |
117,559,210 |
||||
| Pozollana | 14,509,123 | 13,656,799 | 13,092,882 | 15,590,886 | 14,417,840 | |
| Vermiculite | 4,609,083 | 30,085,882 | 1,329,731 | 1,540,574 | 463,490 | |
| Kaolin | 2,088,332 | 4,288,646 | 4,387,527 | 4,628,602 | 3,469,677 | |
| Metallic minerals
Gold |
57 |
508 |
620,188 |
2,860 |
1,493 | |
| Cobalt** | 43,624,952 | 44,702,413 | 14,581,778 | 0 | 0 | |
| Crude cobalt carbonate | _ | _ | 797,914 | 0 | 0 | |
| Wolfram | 347,237 | 1,500,555 | 2,503,230 | 2,753,034 | 1,569,705 | |
| Syenitic Aggregate | 14,647 | 30,708 | 164,859 | 96,906 | 124,073 | |
| Iron Ore | 578,890 | 1,202,147 | 619,217 | 11,383,168 | 2,441,634 | |
| Coltan (30% Purity) | 256 | 0 | 0 | 0 | 10,428 | |
| Tin (75% Purity) | 306 | _ | 872,087 | 1,514,673 | 6,136,330 | |
| Grand Total | 177,654,669 | 207,819,297 | 149,654,032 | 168,339,534 | 146,193,879 | |
Annual change 16.98% -27.99% 12.49% -13.16%
Source: Ministry of Energy and Mineral Development
Contribution of mining investment to local and regional economic growth
- Provision of employment
- Foreign exchange
- Taxes – Licencing & royalties
- Infrastructure development – roads & railway lines
- Industrialization & import substitution
- Improvement in social amenities & utilities – Corporate Social Responsibility (CSR)
- Capacity building – professionals and other personnel in mining industry