SOME of the companies issued with mining licenses earlier this year had not even been registered and had no business name, an investigative report has disclosed. The interim report by the task force set up in August by Mining Cabinet Secretary Najib Balala to look into issuance of licenses issued this year revealed massive irregularities.
"In some instances, licences were issued to entities that at the time of application for the said licences were not incorporated and neither possessed a certificate of incorporation nor a business name registration," stated the report.
"Some licences were issued even though financial capability was not demonstrated by the applicant and in some instances no financial documents are supporting the documents as required by law."
In August, Balala ordered for a review of all the licenses issued from January and cancelled 43 licenses that were issued from March noting that the rush to issue licenses during the transition period when a new government was taking over was very suspicious. He said it was questionable the way some individuals had been issued with mining licenses yet their exploration and financial capability was not clear.
Out of the 43 companies whose licenses were revoked by Balala, the report said only 28 out of these had fully received their licenses with the rest being at various stages of consideration for different types of licenses, the report said.
The task force investigating the matter found that in some cases, the law was blatantly flouted.
"Whereas possession of a valid prospecting right is a requirement for the issuance of exclusive prospecting licences (EPLs) and special licences, some licences were issued where the applicants did not have valid PRs," said the report.
The task force which is chaired by lawyer Mohamed Nyaoga is supposed to issue a complete report within 60 days after its setup and will also be required to recommend measures for developing processes and institutions to effectively comply with the licensing procedures.
After reviewing licenses for this year, Balala, who eyes overhaul of the entire mining sector, said he will ask the task force to start investigations into the other licenses issued between 2003 to end 2012.