Uganda’s Energy Ministry Clarifies On Gold Smelting License

A screenshot of the homepage of Uganda's Mining Cadastre Portal

On May 30, 2024, we published a story under the headline Uganda Issues First Mineral Smelting License For Gold. The story, which we sourced from the government’s Mining Cadastre, noted that a company called SD Test had been issued the country’s first 15-year mineral smelting license for gold in early May. The award of the license, we further predicted, would flip the fortunes in the precious metal industry in Uganda for the better.

It has, however, emerged that Uganda has not issued such a license. The Ministry of Energy and Mineral Development has since gotten back to us and said that the mining cadastre – an online platform where government publishes the different licenses and applications – was undergoing a revamp, and therefore what we had published was wrong.

That with the new law – the Mining and Minerals Act 2022 (which replaced the Mining Act 2003) – coming with new licenses for smelting, processing and refining, the cadastre needs to be reconfigured and tested before the actual licensing starts.

The Mining and Minerals Act 2022 aims to fill the gaps identified in the repealed law to align Uganda’s legislative framework with global trends. The law creates new classes of mineral rights that may be acquired.

We understand that the smelting, processing and refining regulations are likely to be finalized in two months’ time – which should then allow for the issuing of these new licenses and their uploading to the cadastre.

The SD Test Company trial license on the cadastre portal

Importantly though, the government did not issue any notice or alert to inform the public that the platform was undergoing a revamp. Even when we posed questions to different ministry officials before the publication of the story, the answers were not forthcoming.

Now, after the publication of our story, the ministry of Energy has deleted the award of the mineral smelting license for gold from the cadastre. Also, the ministry has made some other changes just to clarify that the system is being overhauled.

For example, while previously the SD Test Company appeared as an entity that had received some exploration licenses, and also made some applications, only one of those licenses now appears on the cadastre; listed as Spatial Dimension Test, but with the word DEMO written in brackets to clearly show that it is a demonstration (see picture below).

A ‘DEMO’ exploration license

Relatedly, with the Mining and Minerals Act 2022 introducing a Large Scale Mining License, Medium Scale Mining License, Small Scale Mining License and Artisanal Mining License to replace the generic Mining Lease and Location License, which originally catered for artisanal miners, the cadastre has been reconfigured to accommodate the expanded licensing regime.

The coding of the licenses is likely to change going forward as a result, we understand. For example a large scale mining lease will probably appear as LSML 0000 under the new law instead of ML 0000.

It is not clear when the ministry will be done with the current revamping of the cadastre. Every significant amendments of the legal regime requires a cadastre update.

The new law separates the licensing function from the regulation function by establishing a Mining Cadastre Department within the Department of Geological Surveys and Mines (DGSM) to administer mineral rights and maintain the cadastral registers.

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Deep Earth
Deep Earth International critically examines developments in the extractive and energy sectors in Uganda and the wider East African region. Drawing from the vast experience of its founders who have each covered and written about these sectors for at least fifteen years, this website is the go-to platform for anyone seeking to get a better understanding of the same.

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