Kampala, Uganda – In a historic move for Uganda’s mining sector, the government has signed its first-ever Mineral Production Sharing Agreement (MPSA) to redevelop Kilembe Mines, the country’s largest copper deposit. This long-awaited deal is set to revive a mine that has remained dormant for more than three decades.
The agreement was officially signed on Monday by Finance Minister Matia Kasaija and Energy and Mineral Development Minister Ruth Nankabirwa, representing the Government of Uganda. The selected investors, Sarrai Group Ltd and Nile Fibreboard Ltd, emerged as the top bidders from a pool of 14 companies that had expressed interest in the project.
A Major Boost for Uganda’s Mining Industry
Minister Nankabirwa described the agreement as a landmark achievement that will significantly boost Uganda’s mineral industry. She emphasized the project’s potential to drive industrialization, create employment opportunities, and enhance local mining operations.
“This morning, we marked a significant milestone in Uganda’s mineral sector by signing the first-ever Mineral Production Sharing Agreement for the redevelopment of Kilembe Mines,” she stated.
Reviving a Long-Dormant Copper Resource
Kilembe Mines, home to over 4 million tons of copper deposits, has faced years of inactivity. The situation worsened in recent years when floods destroyed crucial infrastructure, including the tailings dam, Mobuku hydropower plant, water systems, and administrative buildings.
Under the new agreement, Sarrai Group and Nile Fibreboard will restart the production of copper cathodes and cobalt metal, key minerals in the global clean energy transition. The rising demand for these minerals, driven by the shift from fossil fuels to renewable energy, makes this redevelopment a strategic move for Uganda.
A Step Towards Value Addition and Industrial Growth
The redevelopment project is expected to reinvigorate Uganda’s mining industry by attracting more investment and creating jobs. Government officials highlighted that the initiative aligns with Uganda’s policy of promoting value addition to minerals. Rather than exporting raw materials, the project will ensure that copper and cobalt are processed locally, enhancing economic benefits.
With this milestone agreement, Uganda is positioning itself as a competitive player in the global mining sector while contributing to the worldwide push for clean energy solutions.