The Mining Act 1940 (chapter 306 of the Laws of Kenya) (the “Mining Act”) regulates all mining activities in Kenya. The Commissioner of Mines and Geology (the “Commissioner”), heads the Department of Mines and Geology and is responsible for overseeing mining research and policy as well as implementing the Mining Act.
The ownership of all mineral deposits vests in the Government. In order to carry out mining activities, an investor must apply to the Commissioner to the necessary right, licence or lease as set out below in summary.
1. Mineral exploration
(a) Prospecting Right: any person may apply for a prospecting right which will provide the holder the right to carry out exploration activities in any land.
(b) Exclusive Prospecting Licence (“EPL”): persons who hold a prospecting right may apply for an EPL which provides the holder with the exclusive right to prospect in a designated land. An EPL is initially issued for one year and may be renewed at the discretion of the Commissioner for further terms of one year each up to a maximum of five years. An EPL is not transferable without the consent of the Commissioner.
EPLs normally relate to prospecting in a large area of land. Alternatively “Mining Locations Licences” may be obtained for mineral exploration in a smaller area of land (up to four square kilometers).
2. Mineral exploitation
(a) Mining lease: a mining lease is issued to a holder of any prospecting right and provides the lessee the right to extract deposits within the land area of the mining lease, including the right to remove and dispose of the minerals as specified in the lease. A mining lease may be granted for a term of five to twenty-one years, and will set out the applicable terms and conditions for such mining.
(b) Special Mining Lease (“SML”): where the Commissioner is satisfied that there are special costs or other reasons applicable to a particular deposit, the Commissioner may grant a SML to any person. A SML may be grated and be renewed for such a term, and upon such conditions as the Commissioner may think fit.
All mining leases must be registered with the Commissioner and can only be transferred with the Commissioner’s written consent.
Obtaining a mining lease
The following are some of the main steps to be carried out prior to the issue of a mining lease.
1) Carrying out a mining feasibility study and an approved cadastral survey of the deposit.
2) Preparation of an Environmental Impact Assessment Study (“EIA”) in accordance with the requirement of the Environmental Management and Co-ordination Act No. 8 of 1999. This must be approved by the National Environment Management Authority. The EIA is subject to public comments before such approval;
3) Submitting a formal application for a mining lease (which will include information included in (a) and (b) above, and any compensation agreements payable to landowners) must be published in the Kenyan Gazette and a local newspaper inviting any objections.
4) Registration of the mining lease under the Mining Act and the Registration of Documents Act, and the applicable stamp fees must be paid.
5) Constitution of Kenya states that the Parliament must ratify any right or concession for the exploitation of any natural resource.
The above process typically takes over a year to complete.
For more information please visit
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Ministry of Environment and Natural Resources.
http://www.environment.go.ke/
•
Kenyan Chamber of Mines.
http://www.kenyachambermines.com/
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Kenya Investment Authority.
http://www.investmentkenya.com/
excerpt from “Mining in Kenya – the start of a new era?” by The Mayer Brown Practices
photos from http://basetitanium.com
