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Counties in Kenya to share mining royalties

The final stages of making regulations that will guide on the sharing process of mining royalties in Kenya are underway.

Mining, Blue Economy and Maritime Affairs Cabinet Secretary Salim Mvurya announced that counties will soon have a share of the royalties. CS Mvurya noted that the Mining Act 2016 directed that revenue from minerals was to be shared between the national government, the county government and community living in the mining areas with each getting 70, 20 and ten percent respectively.

“My team is finalising a few grey areas in the Mining Act. The regulations will be taken to parliament and once adopted, the communities will start receiving their rightful share of revenues from minerals. We are also going to ensure counties received royalties owed to them as dictated by law,” said the CS.

Potential growth

The mining sector currently contributes less than 1% of Kenya’s GDP but has potential capacity to contribute 4% to 10%. This means that much of Kenya’s natural resource wealth is yet to be exploited and there could be significant opportunity for growth.

Metallic minerals currently produced in the country include titanium, gold and iron ore. Export statistics for Kenya indicate a constantly growing sector. In 2014, for instance, Kenya exported 281,503 mt of ilmenite, 52,465 mt of rutile and 23,000 mt of

Zircon. It is however expected that with increased development, the country could contribute substantially to annual global supply. With further exploration and uptake of mineral rights then, it is estimated that Kenya will have the capacity to position itself as a regional mining sector hub for Eastern Africa.

Kenya also recently made announcements of having world class deposits of rare earth elements in the coastal region of the country. The recent discoveries are estimated to be worth USD 62.4B and will propel Kenya to the list of top five countries with rare earth deposits in the world. In addition, the country has the world’s top six deposits for Niobium. Commercial deposits of coal have been discovered in the north eastern region of the country and are currently under review for potential uses and production. The country ranks third in the world in ash producing and seventh producer of fluorspar.

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