13 February 2017

Uganda: Government Warns Tibet Hima Company Over Safety Concerns

Works at Kilembe mines in Kasese district resumed 3 years ago after Tibet Hima Industry Mining Company was awarded the concession. Photo from C4MRE

The Internal Mines report reveals that the company has so far invested only $ 51 million in revamping the mine but there are no mechanisms of tracking the 'actual' investment in the mine

Technocrats in the Directorate of Geological Survey and Mines (DGSM) under the Ministry of Energy and Mineral Development have ordered Tibet Hima Industry Mining Company Ltd to halt its activities over safety concerns, Oil in Uganda has learnt.

In the recent Internal Mines Inspection report submitted to Director of Mines, the technocrats noted that Tibet Hima Mining Company flouting all the terms of the concession agreement.

"We recommend that Tibet Hima Industry Mining Company Ltd halt mining activities until it has put in place adequate occupational health and safety provisions, which include proper underground ventilation, provision of relevant protective gear to mine workers, safety and precautionary signage in underground workings, a processing plant and in all concession projects," the report reads.

"Miners were found working without protective gears which is dangerous to their health and as regards to mining best practices, it was also evident that mining methods being used did not cater for sustainable exploitation of Uganda's mineral resources," the report elaborates.

Tibet Hima Industry Mining Company, a consortium of Chinese companies was awarded a concession to revive the mining activities at Kilembe copper mines, process copper and associated minerals to final products in 2013.

According to the DGSM technocrats, the findings are based on field inspection of the mine conducted between June and July 2016 and it exhibited that mining operations at Kilembe site is more of a shadow of the previous Kilembe Mines operation described as 'mechanized artisanal operation.'

As the regulator of the sector, DGSM undertook on-site inspection of Kilembe mines mainly to appraise concessionaire's performance in regards to undertakings outlined specifications on the concession agreement.

Interestingly, the report acknowledges that since signing the concession with Government three years ago, Tibet Hima Mining Company has been able to rehabilitate the cobalt concentrator plant; where they have imported and fabricated on site flotation cells, installed a 1,500 ton per day ball mill and accessory spiral classifier, renovated one of the two existing thickeners and one of the six existing crushed ore bins, and also installed a new vacuum concentrate filtration unit among others.

The report however states that despite these achievements, the procurement procedures were done without passing through the agreed channels and procurement committees.

The company committed itself to injecting in $ 175 million to revamp the mines, rehabilitate the concentrator plant by replacing all the floatation cells and replace all the old mills with new modern mills in order to produce more than 24,000 tons per annum of copper in the first three years.

According to Alex Kwatampora, the Project Manager at Tibet Hima Mining Company, the report do reflect on the gaps in their activities but they have since rectified the problems. He explained that the company is going to invest $ 175 million dollars in a phased approach and part of this money ($ 26 million) will go towards upgrading Mubuku hydro power dam from the current 5 megawatts of power to 12 megawatts and finally to 17.6 megawatts.

"Yes we had some gaps at the time of inspection, but we have corrected them. We have recruited new mine engineers and provided all workers with protective gear in line with the recommendations," he explained to Oil in Uganda.

Weighing on the investment, Kwatampora explained that DGSM technocrats' mandate is to ensure that the company adheres to the technical aspects spelt out in the concession and not delve on the investment since it is not their concern.

"We write quarterly reports to Ministry of Finance about the investments," he told Oil in Uganda.

"People have to understand that this is an old mine, re-opening it is not easy like building a new one, it is costly and requires a lot of time," Kwatampora said adding that the company is to construct a copper smelter and refinery plant to process copper.

Tibet Hima Mining Company Ltd will also conduct a comprehensive mineral exploration to increase on the known reserves of 4.5 million tonnes of copper at Kilembe

The internal report reveals that the company has so far invested only $ 51 million in revamping the mine but there are no mechanisms of tracking the 'actual' investment in the mine.

Among other concerns raised by the report; the company does not have a mine surveyor, a mine geologist as well as a geotechnical engineer to assist the mining engineer in monitoring the underground operations and recommends that it should employ these professional before resuming business.

"Tibet Hima Mining Company Limited need to be instructed to fast track its undertakings as spelt out in the Concession Agreement, given that it recognizes it is behind schedule and ordered to file audited financial statements for purposes of tracking its investment," the report recommends.

Tibet Hima Mining Company Ltd officials however insist that it has rectified the problems and therefore no need to halt its activities.

This is not the first time Tibet Hima Mining Company has been accused of irregularities. In March 2016, the company was forced to suspend its operations after an assessment report by the National Environment Management Authority indicated that the company's sewage disposal unit had a negative environmental impact on the people in the area and the river Nyamwamba water streams.

Whether the recommendation of the technical team will be effected still remains interplay between the technical arm of government and the president's politics of 'not fighting my investors'.

 

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