Russian company ARMZ Uranium Holding has announced plans to start uranium mining in Tanzania after being granted a licence for its Mkuju River mining project in the south of the country.
The licence, issued to Mantra Tanzania, a subsidiary of Australia-based Mantra Resources, is the first to be granted by Tanzania under its new mining legislation. Mantra Resources is wholly owned by ARMZ, which is also known as AtomRedMetZoloto.
“Acquisition of the special mining licence . . . is a real breakthrough and a direct result of a two-year concerted effort at all levels,” says ARMZ chairperson Vadim Jivov.
According to the company, the measured and indicated resources of Mkuju River project are estimated at 36 000 t of uranium, with 10 000 t of this amount in the inferred category. The average grade is 0.024% to 0.025% of uranium.
Mantra Tanzania expects to produce 14 000 t of uranium each year.
Initial projections show that Tanzania will rake in $250-million in royalties a year. The project is expected to create about 2 000 jobs.
The project has also been given the go-ahead by the World Heritage Committee because Mkuju was excised from the Selous Game Reserve, which is a World Heritage Site. The project will affect only about 0.69% of the game reserve.
Tanzania, East Africa’s second-largest economy, is betting on revenue from the mining sector as a key financier of its medium- term economic growth plan, which runs to 2016. The country’s targeting an average growth rate of 8% a year.
According to Tanzania’s National Bureau of Statistics, the mining sector contributes a paltry 2.8% to the country’s gross domestic product. Earnings from the sector have increased steadily from $1.7-billion in 2005 to $3.6-billion in 2011.
In 2010, Tanzania enacted a new mining law that seeks to ensure the East African nation reaps maximum benefits from the sector. The new law increased royalties to 5% for uranium, diamonds and uncut gemstones, 4% for gold and all metallic minerals, 3% for industrial and other minerals and 1% for gems.
Edited by: Martin Zhuwakinyu
Creamer Media Senior Deputy Editor
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