Requirements for Acquiring a Mining License/ Mineral Right in Uganda
1.1 Introduction
Mining in Uganda is regulated by the mining and minerals Act, 2022 and the Mining (Licensing) Regulations, 2019.
The Act prohibits any person from conducting prospecting, exploration, mining, processing, refining or other beneficiation operation under Uganda’s jurisdiction without an authorisation, licence, lease, permit or approval in accordance with the Act, the National Environment Act,2019 or any other written law.
The right to explore for, retain, mine and trade in minerals may be acquired and held under and in accordance with a mineral right granted by the Act, notwithstanding any right of ownership or otherwise which any person may possess over the land on which the mineral right is granted.
The Act defines a “mineral right” to mean a right to prospect, explore or mine for minerals under a prospecting licence, an exploration licence, a retention licence, a large scale mining licence, a medium scale mining licence, small scale mining licence or an artisanal mining licence. The types of mineral rights that may be granted under the Act;
(a) prospecting licence;
(b) exploration licence;
(c) retention licence;
(d) large scale mining licence;
(e) medium scale mining licence;
(f) small scale mining licence; and
(g) artisanal mining licence.
The Act prohibits any person from prospecting, exploring for, retaining, mining, processing, refining, smelting, fabricating or disposing of any mineral in Uganda save for persons who acquiring a license.
1.2 Who May Acquire A Mining Licence/Mineral Right In Uganda?
A mining licence in Uganda may be granted to;
- a company registered or incorporated under the Companies Act,2012;
- a body corporate registered or incorporated under the laws of Uganda;
- a partnership under the Partnership Act, 2010;
- a cooperative society registered under the Cooperative Societies Act;
- a trustee incorporated under the Trustees Incorporation Act; or
- an association or business registered under any other written law.
It should be noted that the Act restricts granting of mineral rights or licence to Non Ugandans and entities not incorporated or registered in Uganda.
1.3 Requirements For Attaining A Mineral Right/ Mining Licence
Prospecting licence;
The Act defines “prospecting” to means intentionally searching for minerals and mineral deposits and includes any operations to test the mineral-bearing qualities of any area.
Section 35 of the Act provides that an application for a prospecting licence shall be made to the Minister responsible for mineral development in a manner prescribed by regulations.
The Application shall contain;
- contain in respect of an individual, the name and nationality of each individual making the application;
- contain the registered name and place of incorporation of the company
- a certified copy of the certificate of incorporation of the company;
- a certified copy of the memorandum and articles of association;
- the names and nationalities of the company directors;
- the name of every shareholder who is a beneficial owner of five percent or more of the issued share capital;
- contain the company profile and history of prospecting in Uganda and elsewhere;
- be accompanied by a statement giving particulars of the technical and financial resources available to the applicant;
- give details of any mineral right held within Uganda by the applicant or by any person controlling, controlled by or under joint or common control with the applicant;
- be accompanied by proof of payment of the prescribed fees;
A prospecting licence once issued is valid for a period of one year and is not renewable.
Exploration licence
The Act defines the term “explore” to mean to define the extent and determine the economic value of a mineral deposit and includes activities undertaken in order to identify, and determine the presence of minerals or mineral deposits and to assess the extent and economic value of a mineral deposit.
an application for an exploration licence shall be made to the Minister responsible for mineral development in a manner prescribed by regulations.
The application is accompanied by;
- Filled Exploration License Application Form
- Proof of mineral occurrence
- Work program and budget for the exploration operations
- Proof of financial resources
- Tax Clearance Certificate issued by the URA to Ministry of Energy and Mineral Development (MEMD)
- Proof of the technical capacity (include CVs and academic documents)
- Proposals for the employment and training of Ugandan citizens (include training plan and budget)
- Statement on the procurement plan of goods and services available in Uganda
- a project brief in accordance with the National Environment Act, 2019.
The exploration licence shall be valid for a period not exceeding four years from the date of grant of the exploration licence and it may be renewed for a single period not exceeding three years.
Retention Licence (Rl)
This Licence is given to the holder of an Exploration Licence who has identified a mineral deposit but the deposit cannot be immediately developed due to factors beyond reasonable control of the Licence holder, which are of a temporary nature.
Requirements For Application For A Retention Licence
- Pre-feasibility study and assessment by an accredited consultant
- Filled Retention Licence Application Form
- Exploration Licence returns
- Detailed report on Mineral Resources
- Proof of financial resources
- Certified copies of the previous audited financial year balance sheet
- Particulars of the applicant’s proposal for employment and training of Ugandans
- Statutory Declaration (reason for requesting grant of Retention Licence)
- Work program and budget for the retention operations
- Tax Clearance Certificate
- Proof of technical competence (includes CVs and academic documents)
Large Scale Mining Licence
The Act defines “large scale mining” as the intentional mining of minerals in mechanised operations, involving the excavation of large surface pits, sinking of shafts, driving of adits or other underground openings with limitations to the extent of the mining operation dictated by the extent of the ore body and the capital investment Exceeding nineteen million, four hundred and ten thousand (19,410,000) Currency Points;
An application for a large scale mining licence shall be made to the Minister in a manner prescribed by regulations. The Licence is granted for large mining operations in an area not more than 50km2 requiring a capital investment threshold exceeding nineteen million, four hundred and ten thousand (19,410,000) currency points (1currency point = UGX 20,000)
Requirements For Application For A Large Scale Mining Licence
- Large scale Mining application form
- Tax clearance certificate issued by URA to MEMD
- Company profile and history of mining operations in Uganda and elsewhere
- Detailed report on mineral resources
- be accompanied by a statement giving particulars of expected infrastructure requirements
- Certificate of approval of environmental and social impact assessment (ESIA)
- Feasibility study and assessment by an appropriate expert or accredited consultant
- Identification of interested and affected parties and details of minutes of any consultative meetings
- Statement on the procurement plan of goods and services available in Uganda
- Statement giving particulars of the applicant’s proposals with respect to the employment and training of citizens of Uganda.
- Details of the applicant’s proposals for insurance including health cover for its employees and workers’ compensation; roposals for value addition;
- Proposed marketing arrangements for the sale of the mineral(s) to be produced;
- Detailed statement of the assets and liabilities signed by the applicant, or, in the case of an applicant which is a body corporate; – certified copies of the balance sheet and profit and loss account of the previous financial year of the applicant – a copy of the certified audited report of the applicant -a certified bank statement
- Proof of the technical capacity (include CVs and academic documents)
- Plan for co-existence with customary landowners or communities owning the land in the area subject to a mineral right;
- Business plan (forecast of capital investment, operating costs and revenues, the anticipated type and source of financing etc)
- Mine plan (break even, capacity, recovery, mineral products, rehabilitation, restitution of land rights at expiry or termination)
- Written proof that the applicant has obtained the surface rights from the registered owner, customary owner, lawful occupant or bona fide occupant of the area that the applicant intends to mine
Medium Scale Mining Licence (Mml)
This Licences issued for mining operations in an area not more than 50km2 requiring a capital investment threshold from fifty-eight thousand, two hundred and thirty (58,230) currency points to nineteen million, four hundred and ten thousand (19,410,000) currency points (1currency point = UGX 20,000)
Requirements For Application For A Medium Scale Mining Licence
- Medium Scale Mining application form
- Mine plan (break even, capacity, recovery, mineral products, rehabilitation, restitution of land rights at expiry or termination)
- Proof of financial competence including; – certified copies of the balance sheet and profit and loss account of the previous financial year of the applicant. – a copy of the certified audited report of the applicant -a certified bank statement
- Proof of the technical capacity (include cvs and academic documents)
- Written proof that the applicant has obtained the surface rights from the registered owner, customary owner, lawful occupant or bonafide occupant of the area that the applicant intends to mine
- Certificate of approval of environmental and social impact assessment (ESIA)
- Proposals for value addition
- Proposed marketing arrangements for the sale of minerals produced
- Tax clearance certificate issued by URA to MEMD
- Detailed report on mineral resources to prove that the proposed minerals to be mined exist in the proposed mining area
Small Scale Mining Licence (Sml)
This is granted for mining operations in an area not more than 10km2 requiring a capital investment threshold exceeding nineteen thousand four hundred and ten (19,410) currency points to nine hundred seventy thousand and five hundred (970,500) currency points (1currency point = UGX 20,000.
Requirements For Application For A Small Scale Mining Licence
- Small Scale Mining License Application Form
- Tax Clearance Certificate
- Proof of mineral occurrence
- Proof of technical competence
- Proof of financial resources
- A statement of particulars of the nature of the mining operations and the capital expenditure
- Provisional agreement with the land owner
- Certificate of approval of environmental and social impact assessment (ESIA)
- Proposed programme for value addition (optional)
- Proposed marketing arrangements for the sale of the mineral production
Artisanal Mining Licence
This issued for mining operations not exceeding nineteen thousand four hundred and ten (19,410) currency points (1cp = UGX 20,000).
Requirements For Application For An Artisanal Mining Licence
- Artisanal Mining Application Form
- Tax Clearance Certificate
- Proof of mineral occurrence
- Proof of technical competence
- Proof of financial resources
- A statement of particulars of the nature of the mining operations and the capital expenditure
- Provisional agreement with the land owner
- Certificate of approval of environmental and social impact assessment (ESIA)
- Proposed production schedule and marketing arrangements for the sale of the mineral produced.
Conclusion;
it is important to note that a holder of a mineral right/mining licence as discussed above has the right to sell any minerals acquired by him or her under the Act without obtaining a mineral dealer’s licence.