Base extends Kenyan operations to 2024

Australian mining company, Base Titanium will continue its operation in Kenya for at least another two and a half years, management indicated on Monday.

The company has moved its mineral exhaustion timelines from November next year to June 2024, with hopes that by then, it will have received approvals to further expand its operations in Kenya.

It had earlier indicated it would exhaust the current licensed area by October this year, before getting a nod to increase activities which pushed the timelines to November 2023.

In a telephone interview with the Star, General Manager External Affairs, Simon Wall, said a boundary variation granted by the government has allowed the firm to extend its mining activities further.

“We can't finish in 2023. The variation has pushed things to 2024,” Wall said.

He however confirmed that land rehabilitation is ongoing in case the firm closes shop by 2024.

It has made seven exploration licence applications which are still pending at the mining ministry.

Prospecting licence applications lodged for an area south of Lamu (applications 2019 0263, 0265, 0266), together with an area in the Kuranze region of Kwale county, about 70kilometres west of Kwale Operations (applications 2019 0260, 2510 and 2512), are still pending, more than three years now.

“We want to stay as much as we can but anything beyond 2024 needs prospecting licenses which will determine if we find additional minerals,” Wall said.

In July last year, the Petroleum and Mining Cabinet Secretary John Munyes said the firm's application for mining had been approved.

“We have looked at the application and a license will be issued soon,” Munyes said, noting that the company had put in place the required measures, including earning a social license to operate in Kenya.

However, mining activities could not take place without a 'deed of variation' to extend its Special Mining Lease boundary, which was pending.

It further needs mining licenses if it is to invest in commercial activities beyond the current site.

The company spent about Sh10.7 million in exploration activities between January-March last year, hoping it would discover minerals and get approvals to continue mining in Kenya, where titanim ores have been instrumental in industry earnings.

The company which commenced production in late 2013 accounts for 65 per cent of Kenya's mineral exports.

Together with Tata Chemicals, which accounts for 48.9 per cent of sector revenues, the two holds 77 per cent of the country's mineral revenue earnings.

The total quantity of the titanium ore minerals produced however declined by 9.5 per to 4.4 million tonnes in 2020. Soda ash production declined by 9.7 per cent from 2.82 million tonnes in 2019 to 2.54 million tonnes in 2020, the Kenya Economoc Survey 2021 indicates.

“The decline is attributed to decrease in demand for minerals in the external market due to Covid-19 pandemic,” the survey by the Kenyaya National Bureau of Statistics reads in part.

The value of the titanium ore minerals produced declined from Sh19.6 billion in 2019 to Sh19.5 billion in 2020.

The value of titanium ores and concentrates however went slightly up to Sh16.7 billion, thanks to favourable prices in the international markets.

The future of Base Titanium is now in the hands of the ministry, with the current political environment and the August elections likely to further delay issuance of licenses to mining companies.

A government moratorium on the issuance of Prospecting Licenses in November 2019 has affected the progress of all licence applications.

However, technical assessment of applications recommenced last year.

Community compensation programmes have been a major issue in mega investments in the country, with political interference slowing down projects.