Opinion and Analysis
$224m - The deal that Britam lost to new entrant Cytonn Investments Management Ltd. PHOTO | FILE | REUTERS
By Business Daily
The mining industry is set to undergo tremendous
changes if the proposed creation of a mineral rights board is approved
by the National Assembly.
For many years, the power to issue and cancel mining
licences was left interchangeably to the commissioner of mines and
geology, minister for natural resources, or Mining secretary depending
on the regime.
The creation of a Mining ministry by the Uhuru
Kenyatta government signified the role that this sector is to play in
the coming years. This has partly been informed by the discovery of
commercial oil, gold, steel, coal and titanium deposits in the country.
Last year, the government was forced to cancel 31
licences that had been issued to various companies after it emerged that
they were issued under unclear circumstances.
Also, the companies were paying insignificant
royalties on the minerals they extracted, raising questions on whether
the country was getting value for its deposits.
While the mining sector has been a small
contributor to the GDP, it is expected that with proper management,
exploration and more extraction, Kenya could earn more from its
minerals. But this cannot be done if the sector is not streamlined.
The quest to establish a mineral rights board is a
move in the right direction. This body will be able to deliberate and
set royalties. It will also be able to advise the Cabinet secretary on
the granting, revocation and transfer of mineral rights agreements.
We hope that Parliament will give teeth to the mineral rights board for that is the only way it will make a difference.
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