Uganda has signed its first-ever mining production sharing agreement (PSA) to breathe new life into the Kilembe copper and cobalt mine, located in the country’s west, near the Democratic Republic of Congo.
The Kilembe mine, nestled at the foothills of the Rwenzori Mountains, holds an estimated 4 million metric tons of ore. The ore contains 1.98% copper and 0.17% cobalt, both vital for the global shift to clean energy technologies.
Under the terms of the PSA, Ugandan companies Sarrai Group Limited and Nile Fibreboard Limited will jointly oversee the redevelopment of the mine. This strategic partnership marks a milestone for Uganda’s mining sector, Energy and Mineral Development Minister Ruth Nankabirwa announced on social media.
Although Nankabirwa did not disclose the investment details, the partnership is seen as crucial for Uganda’s industrialization and the global energy transition.
Sarrai Group is one of East Africa’s largest industrial firms, specializing in wood products, while Nile Fibreboard, a subsidiary, also deals in wood products. It remains unclear if these companies have mining experience.
“This morning, we marked a significant milestone in Uganda’s mineral sector by signing the first-ever Mineral Production Sharing Agreement for Kilembe Mines,” Nankabirwa said in her post.
Over a dozen firms had expressed interest in the project, but Sarrai and Nile were chosen for their proposal. The Kilembe mine, which first began production in 1956, once produced 18,000 tons of copper cathodes annually in the 1970s. Operations were halted due to low copper prices and political instability.
The mine’s redevelopment is expected to produce both copper cathodes and cobalt metal, materials essential for clean energy technologies.
