Business News of 2013-12-16

Blaz Metals to invest US$100m in Ugandan gold project

A Ghanaian gold mining company, Blaze Metals Resources Ashanti, has entered into a joint venture project to explore for gold in the districts of Bugiri and Namayingo in Eastern Uganda.

The partnership between Blaze Metal Resources Ashanti, Lynks FZC and Amor Mines will see the three collectively hold exploration licences in the two districts covering a land space of about 60 square kilometres.

Prince Opoku, the operations director for Blaze Metal Resources Ashanti, said they are targetting two million ounces in the licence area which holds other base metals such as iron ore and coltan.

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

Opoku was addressing a community sensitisation forum for local leaders from Bugiri and Namayingo districts in Bugiri, Uganda.

The development highlights the growing interest in Uganda’s budding minerals sector that recently hosted several global players during the 2013 minerals wealth conference in Kampala.

During the October conference, President Yoweri Museveni urged the industry to focus on value addition of the minerals as a way of enabling Uganda gain value. Opoku said the forum was called to familiarise the leaders with their exploration programme.

“Exploration activities such as blasting, trenching and excavating will be carried out. These activities will create interruptions, affecting the daily lives of the people,” Opoku said.

He added that the project requires compensation in the areas that they will map out. “We will compensate whoever owns land, but we will not be buying the land. After our project, we will restore the land and give it back to the owners,” Opoku said.

Bugiri and Namayingo have for long played host to unregistered small-scale miners who have been working on the land with rudimentary tools. Wilbur Waisswa, the Namayingo district chairman, said the local communities have not benefitted from illegal mining.

“I am happy that this partnership will give way to mining of gold the proper way,” Waisswa said. Uganda’s Mining Act stipulates that minerals are the province of the state, with royalties accruing from a mining area shared out between the Central Government (80%), the district (10%), the sub-county or town council (7%) and the land owner (3%).