Uganda’s Kilembe Copper Mine Sold to Chinese Investors

KAMPALA-The government of Uganda has finally sold Kilembe Copper Mines Limited to a Chinese investor.

The mine located about 350 kilometers by road west of the capital Kampala has been out of production for more than thirty years.

A statement issued on Thursday by the Spokesperson of the Divestiture Reform Implementation Committee-DRIC a sub cabinet committee responsible for the privatization process indicates that the mine has been sold to the Tibet Hima Industry Company Limited.

Tibet Hima-Industry Company Industry Limited emerged winner after it out bided Gingko another Chinese firm.

Worth noting in the deal is a commitment to make an initial investment of US$135M towards the rehabilitation of the mine and the upgrade of the nearby Mobuku power plant to 12 kilowatts.

“They exhibited commitment to rehabilitate the mine to commence the commitment of the established 4.5m tones of copper and tailings alongside ensuring in-country value addition” noted Jim Mugungaa the Spokesperson of the divestiture reform implantation unit in the statement.

Mugunga said Tibet also committed to a signature fee of US$4.3M concession fee as well as annual concession fee of us$ 1.005M.

It will also benefit from income tax and mining royalties.

Kilembe once the biggest contributor to Uganda’s Gross Domestic Product was shut down in 1982 during the time that Uganda was experiencing violent upheavals.  It has since then been in limbo with most of its infrastructure destroyed.

The railway line which links it to a smelting plant in the eastern district of Jinja is none functional something which poses a serious challenge for its resumption.

The plant was recently hit by floods which submerged it and destroyed more machines.

The new owners Tibet Hima will hope to cash in on high demand for copper from countries such as China and India.

 

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