Thu, 17 Oct 08:06:00 GMT
NAIROBI, Oct 17 (Reuters) - Kenya's government plans to hold a 10 percent stake in large mining concessions under a planned law aimed at making more money from the sector, Mining Cabinet Secretary Najib Balala said on Thursday.
Since gaining independence from Britain in 1963, successive Kenyan governments have failed to exploit fully the country's mining potential, with foreign exploration companies discouraged by poor infrastructure and an outdated legal framework.
"The bill is at the cabinet level. The bill also envisages there will be a 10 percent free carrying interest on all larger mining concessions. And this will be held by government through the national mining corporation," Balala told a mining conference in Nairobi.
Balala did not say what these mining concessions were or if the bill would affect existing mining licences.
In August, Kenya unexpectedly increased royalties on minerals produced in the east African country and revoked some mining licences to get a bigger share of earnings from its mining sector. [ID:nL6N0G63PX]
Earlier in October, Australian miner Base Resources started mining at its long delayed Kenya titanium project and said it expected to start exporting minerals in December. [ID:nL6N0I11AP]
East Africa's largest economy is seeking to derive a bigger share of earnings from its relatively modest and undeveloped mining sector, and the launch of the flagship $305 million project is seen as integral to that plan.
Kenya also has gold and coal deposits, and a subsidiary of Canada-based minerals and metals firm Pacific Wildcat Resources is scouring the coastal region for niobium, which is also used to make alloys for jet engines and to strengthen steel.
Balala said the bill will also lay out details on how mining revenues will be shared between the national and county governments, and also make application for mining licences more transparent.
(Reporting by George Obulutsa; Editing by Kevin Mwanza and David Cowell)