News Updates at E-Society Kasese
The miserable years of redundancy at the previously busy Kilembe Mines could soon be over if the current appeal by government for a buyer attracts interest.
The miserable years of redundancy at the previously busy Kilembe Mines could soon be over if the current appeal by government for a buyer attracts interest.
The Privatisation Unit in the Ministry of
Finance, Planning and Economic Development has issued a statement of
request for confirmation of interest for concession of the assets of
Kilembe Mines Limited, the company that operates the Kasese Copper Mine
and a smelting plant in Jinja.
The statement is an invitation to prospective buyers to confirm their interest in the deal.
The statement is an invitation to prospective buyers to confirm their interest in the deal.
The statement adds that the successful bidder
would enter into a concession agreement with the government, take over
the rehabilitation of assets, revive the mining activities and carry out
further exploration activities.
Kilembe Mines Limited was established and
incorporated in Uganda as a mining company in 1950 and registered the
highest copper production in the 1970s when maximum output soared to
17,000 tons yearly.
However, the success lasted until 1982, leaving
the mine on a care-and-maintenance basis. The company, whose majority
shares of 99 per cent is owned by government and one per cent by Toro
Kingdom, currently survives by generating and selling electricity to the
national grid.
Mr Fred Kyakonye, the general manager of Kilembe
Mines, has confirmed the move by government to sell the property to an
investor. He explained that the transaction would ease attempts to
access resources and revive the company.
Mr Kyakonye also explained that the years of
redundancy has attracted encroachers who are stealing the property of
the company, adding that presently, they spend much of their time
frequenting court to battle over ownership claims of the assets such as
land from the encroachers.
Mr Kyakonye, however, said the mine has potential that only requires technical and financial resources to restore.
Mr Kyakonye, however, said the mine has potential that only requires technical and financial resources to restore.
The present attempt to sell off the assets of
Kilembe Mines is one of the many endeavours government has made over the
past years to revive the copper producing firm, one of the largest
investments in the mining sector.
In 2010, government sought investors to manage
Kilembe Mines, whose assets include a copper mine, power generation
plant, lime factory and a timber treatment plant. At the time,
government proposed a joint venture, with a progressive buy out of all
its shares by the potential investor. It, however, said share holding
percentage would be determined by the level of investment.
In the current plan, government has said it is
seeking to implement the divestiture of the Kilembe Mines Limited
through a Public-Private Partnership, meaning it would jointly own the
property with the private firm. However, this arrangement could also
change.
A statement from the Privatisation Unit says while
government’s preference is for a Public-Private Partnership
arrangement, interested bidders could propose other suitable
arrangements.
The transaction comes at a time when there is a
reported attractive market price of copper and cobalt with increasing
demand especially in China, India and Japan. In addition, the management
of Kilembe Mines says there is a confirmed 4 million tons of copper ore
at the mine as well as an un-exploited 2,800 acres under the mining
lease.
Some of the products also produced at the Kilembe
Mines include wagon wheels, brake blokes, pulleys, water pumps, man-
hole covers, seed oil mills, bricks making machines, mini- hydro
electric plants, and various ferrous and non ferrous castings for
manufacture of spare parts for machinery.
The sale of the company could also provide sufficient employment.
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