Uganda launches first industrial gold mine

Uganda has officially inaugurated its first large-scale gold mining and refining operation, a $250 million investment that is expected to transform the country’s minerals sector and strengthen its position in the global bullion market.

The Wagagai Gold Mining Project, located in Busia district in eastern Uganda, marks the country’s transition from largely informal artisanal mining to industrial-scale gold production. The project, owned by Wagagai Mining (U) Limited, spans just over nine square kilometers and is equipped with state-of-the-art mining, processing, and refining facilities.

According to the president’s office, the plant has commenced operations with the capacity to process 5,000 tons of gold ore daily, producing up to 1.2 metric tons of refined gold annually at 99.9% purity. This represents a dramatic leap from Uganda’s official domestic gold output of just 0.0042 tons in 2023.

President Yoweri Museveni, who presided over the inauguration ceremony, hailed the development as a “new era” for Uganda’s mining industry.

“In order to wake up in the minerals sector, we must have full value addition for all minerals like gold, lithium, tin among others,” Museveni said, emphasizing the government’s strategy to maximize revenue through integrated refining and processing.

Gold has emerged as Uganda’s leading export in recent years. In 2024, the country earned $3.4 billion from gold exports, accounting for nearly 37% of its total export revenue, according to central bank data. However, most of this came from re-exports, with domestic production largely dominated by small-scale miners.

The launch of Wagagai is therefore expected to not only increase direct gold exports but also improve transparency, environmental standards, and formal employment in the sector. Despite Uganda’s rising profile, it remains behind Ghana, Africa’s top gold producer, which earned $11.6 billion from gold exports in 2024. Officials believe that large-scale industrial projects like Wagagai could help narrow that gap.

Economic impact

Beyond mining, the project has delivered significant infrastructure investments, including access roads, power supply systems, and worker housing. Museveni noted that revenues from gold exports would also be used to fund national development priorities such as power generation and railway modernization.

Uganda is currently building a €2.7 billion ($3.16 billion) standard gauge railway to lower transport costs for both imports and exports via neighboring Kenya, a project the government says will be partly sustained by revenues from mineral exports.

The Wagagai project represents the single largest investment in Uganda’s mining industry to date and a turning point in the country’s broader industrialization strategy. Its projected output signals a 286-fold increase in Uganda’s gold production, ushering in a shift from artisanal operations to structured, industrial mining.

Analysts say the move comes at a strategic time, with global interest in gold prices and production outlook for 2025 expected to remain strong amid economic uncertainties. The mine is set to generate jobs, boost skills development, and position Uganda as an emerging player in Africa’s gold industry. As operations scale up, it could also serve as a model for the country’s approach to other critical minerals, including copper, cobalt, and lithium.