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Mineral Exploration, Licensing, and Early Community Engagements, Global Comparative Policies and Best Practices
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August 4, 2023 10:56 am
Demonstrating Tanzania’s strength and superiority in mineral exploration capacity, and drawing lessons for replication by nascent and developing extractives sectors in such countries as Kenya
Tanzania has put in place laws that offer tax reliefs and incentives to encourage mineral development and draw capital to the industry. The Mining Act of 2010, which provides tax incentives to exploration companies, is one important policy. For newly founded exploration businesses, one of these incentives is a three-year tax break during which time they are exempt from paying corporate income tax. Additionally, the Act states that taxable income is reduced by exploration costs that were spent during the discovery period. These rules are designed to lessen the financial burden on exploration firms, boost investment in mineral development, and motivate businesses to engage in discovery. Additionally, Tanzania has created the Geological Survey of Tanzania (GST) as a trustworthy source of geological data and information, which lowers the risk of exploration for businesses and aids informed decision-making. Through the Tanzania Investment Centre (TIC), which offers facilitation services, investment guidance, and aid with getting permits and licenses, the government also gives support to exploration companies. Tanzania's dedication to fostering exploratory operations, luring investors, and maximizing the country's mineral resource potential is demonstrated by these regulations and incentives.
To improve its own mineral exploration business, Kenya might take note of the incentives and tax breaks Tanzania provides to exploration companies. Kenya can adopt the particular advantages offered in Tanzania, such the tax break for recently founded exploration businesses and the exclusion of exploration costs from taxable income. Kenya can entice investment and boost exploration efforts by implementing comparable tax incentives. The tax relief measures may lessen the financial strain on exploration companies, improving the financial viability and investor appeal of projects. In order to offer trustworthy geological data and information that can help informed decision-making and lower exploration risks, Kenya can also establish a specialized organization or department, comparable to the Geological Survey of Tanzania. Kenya can also benefit from the facilitation services provided by the Tanzania Investment Centre, which help exploration companies with permits, licenses, and investment guidance. By implementing these steps, Kenya may improve the environment for investments, encourage mineral exploration, and realize the full potential of its mineral resources.
Exploration of minerals takes place on land which is owned by Government, citizens or other private entities, describe the land ownership situation and regulations in Tanzania in the perspective of exploration activities, consent, access rights and mutual benefits to land owners, government, exploration firms and potential investors in the sector.
Government ownership, traditional land rights, and private ownership are all included in Tanzania's land ownership structure when it comes to mineral prospecting. All mineral rights in Tanzania are owned by the government, and any exploration must be authorized by this body. Customary land rights are acknowledged, nevertheless, and certain regions may be owned by local communities or indigenous groups. Obtaining permission from the landowners—whether they be governmental bodies, local communities, or private individuals—and negotiating with them are necessary for access to the property for exploratory objectives. Regulations regulating exploratory activities are outlined in the Mining Act of 2010, which also specifies the need for social and environmental impact studies. It highlights the necessity of community participation, consultation, and benefit sharing with impacted landowners and communities. Exploration companies and landowners frequently reach agreements that cover pay, benefit sharing, and environmental preservation. The goal is to make sure that everyone benefits, including through creating jobs, improving infrastructure, and making social investments that advance the socioeconomic well-being of the neighbourhood. In general, Tanzania's land ownership structure and laws place a high value on community consent, access rights, and benefits shared by landowners, the government, exploration companies, and potential investors, encouraging ethical and sustainable mineral exploration methods.
Tanzania has instances of mineral exploration firms collaborating with communities in their mining investment projects effectively, exemplifying best practices in community involvement. One such instance is Barrick Gold Corporation, which runs the Tanzanian gold mines Bulyanhulu and North Mara. Various community involvement programmes, such as local employment programmes, skill development courses, and community development projects, have been launched by Barrick Gold. The business has worked with the community to solve issues, offer possibilities for sustainable livelihoods, and advance social and economic development. AngloGold Ashanti, which runs the Geita Gold Mine in Tanzania, is another noteworthy instance. The business has launched community development initiatives with an emphasis on advancing infrastructure, health, and education. AngloGold Ashanti often meets with local communities through consultation procedures, community forums, and other means to ensure effective communication and meaningful involvement. These instances demonstrate the dedication of Tanzanian mineral exploration firms to sustain constructive connections with communities, provide due consideration to their needs and goals, and support their social and economic well-being through long-term community involvement strategies.
However, the situation is different in Kenya as there are several drawbacks to mineral exploration policies in Kenya that might impede its development and efficacy. The lack of thorough geological data and information, which makes it challenging to correctly locate and assess possible mineral resources, is one major obstacle. The capacity of exploration businesses to make wise investment decisions is hampered by limited access to recent geological surveys and exploration data. Another major drawback is the inadequate infrastructure, which can hinder exploration efforts in distant or undeveloped locations. This includes poor power and transportation networks. Another factor that can cause delays and deter investment in mineral exploration projects is bureaucratic red tape, difficult licensing requirements, and regulatory uncertainty. Exploration efforts may also be hampered by concerns with land ownership, community involvement, and socio-political stability. These drawbacks highlight the significance of having sound exploration policies for effective mineral development.
In Kenya, the mining sector has not always been open to welcome community engagement in exploration activities. As a result, there have been serious drawbacks. First off, a lack of community engagement has led to disputes and hostilities between local people and mining enterprises. The exclusion of communities from exploration has resulted in them deeming mining efforts as a danger to their way of life, cultural history, and the environment if sufficient consultation and communication aren't conducted. Protests, legal challenges, and even acts of violence might follow, disrupting business as usual and impeding advancement. Additionally, mining projects may not adequately address the particular needs and concerns of the local population without community involvement. This may cause social and environmental effects to be disregarded, aggravating problems like land degradation, water contamination, and the eviction of indigenous groups.
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Khadija Omar Said
Mining and Mineral Processing Engineer (MSc)
IVOD Global Mining Communities Consultant
This topic was modified 11 months ago by IVOD
September 24, 2023 9:18 am
The strengths of Tanzania's mineral exploration sector and offers valuable insights for Kenya. Tanzania's tax incentives, geological data accessibility, and governmental support for exploration are commendable, and Kenya can indeed learn from these practices. Tax relief measures, in particular, could alleviate financial burdens on exploration companies and make projects more appealing to investors in Kenya.
Additionally, the description of land ownership and regulations in Tanzania sheds light on the importance of community consent and benefit-sharing, emphasizing ethical and sustainable exploration practices. It is crucial for Kenya to adopt similar principles and regulations to ensure that local communities are engaged and that the benefits of mineral exploration are shared equitably.
The examples of community engagement in Tanzanian mining projects, particularly those by Barrick Gold Corporation and AngloGold Ashanti, serve as valuable models for Kenya to follow. Effective community involvement can prevent conflicts and lead to mutually beneficial outcomes. Kenya should take note of these successful practices to foster positive relationships with local communities.
However, the assessment of Kenya's mineral exploration policies raises important concerns. The lack of geological data, infrastructure challenges, bureaucratic hurdles, and issues related to community engagement are significant obstacles that need to be addressed. It's crucial for Kenya to develop sound exploration policies that prioritize community involvement, transparency, and environmental sustainability to overcome these challenges and unlock the potential of its mineral resources.
All in all, Tanzania's successes and lessons learned offer Kenya valuable insights into how to develop and strengthen its own mineral exploration sector. Addressing the identified drawbacks and embracing best practices in taxation, community engagement, and regulatory frameworks will be crucial for Kenya's future in mineral exploration.
November 6, 2023 9:18 am
Mining being a leading industrial sector in Tanzania has witnessed a substantial increase of the value of mineral export in the past several years. Both large and small scale mining sectors are operational and regulated by the government. Tanzania is home to alot of valuable minerals that are still in exploration stage. Fuel minerals such as coal and uranium, industrial minerals such as diamond, tanzanite, ruby, garnete, limestone, soda ash, sand, gypsum, gravel, phosphate and mineral metals such as gold iron, ore, nickel, cobalt and silver have been discovered.
Tanzania is the fourth largest gold producer in Africa after South Africa, Ghana and Mali and stands to be world's sole producer of the precious stone, Tanzanite. At the moment, gold production is at 40 tonnes a year, 2980 tonnes of copper, 10 tonnes of silver and 112,670 carats of diamond. In 2019, Tanzania earned 2.3 billion US dollars on mineral export which is a significant increase following 1.6 billion US dollars in 2018.
Having measures stated in the posts above and a thorough follow up on the same, not to mention law enforcement, has bore fruits and more benefits are yet to be enjoyed by the country sector stakeholders, investors and the community at large. A lesson that Kenya can implement and experience sector development and growth.