Uganda chooses two investors to re-develop Kilembe mines

Finance Minister Matia Kasaija and Energy Minister Ruth Nankabirwa signed a Mineral Production Sharing Agreement on Monday with investors for the redevelopment of Kilembe Mines.

Following a competitive bidding process involving 14 firms, Sarrai Group Ltd and Nile Fibreboard Ltd were selected as the winning bidders.

Minister Nankabirwa highlighted that this flagship project will produce copper cathodes and cobalt metal, crucial components for clean energy technologies. It will also drive Uganda’s industrialization, create jobs, and support local mining operations.

Kilembe Mines, Uganda’s largest copper mine, holds estimated copper deposits exceeding 4 million tons. The mine has been dormant for over three decades. Recent devastating floods damaged infrastructure, including a tailings dam, the Mobuku hydropower plant, water systems, and administrative buildings.

Cobalt and copper are essential for clean energy technologies, supporting the global transition away from fossil fuels.

Richard Kaijuka, Chairman of the Board of Trustees of the Uganda Chamber of Mines and Petroleum, had previously expressed concern over delays in the Kilembe Mines redevelopment. He emphasized Uganda’s potential to become a hub for critical minerals vital to the global energy transition. “We in the Chamber are not happy with the delays. I’m sure the minister understands why we are becoming impatient,” Kaijuka stated.

He also noted Uganda’s rich deposits of other critical minerals, including nickel, lithium, and rare earth elements.

In its peak production year of 1970, Kilembe Mines produced approximately 18,000 tonnes of copper cathode annually and operated a smelting plant in Jinja. At that time, copper, alongside coffee and cotton, constituted Uganda’s top three foreign exchange earners, known as the “Three Cs.”

The mine’s decline resulted from aging equipment, falling global copper prices, perceived resource depletion, and political instability. In 2013, Tibet-Hima Mining Company Limited, a Chinese firm, took over operations, but the government terminated the contract due to slow implementation and alleged illegal export of unprocessed ore.