The government yesterday signed a $22 million (about Rwf14.5 billion) mining concession with Pella Rwanda Resources Ltd to exploit Musha and Ntunga sectors in Rwamagana District, Eastern Province.
Pella Rwanda Resources Ltd is owned by UK-based Pella Resources Ltd, an African-focused natural resource and energy group.
The mining company has a strong track record in exploration and mine development across 18 countries in Africa, according to authorities.
Clare Akamanzi, the acting chief executive of Rwanda Development Board, and Evode Imena, the minister of state for natural resources in-charge of mining, signed for Rwanda, with Thomas Jiji Nziratimana, the executive director of Pella Rwanda Resources Ltd.
The deal says Pella Rwanda Resources Ltd will inject $22 million in the project for five years as well as carry out mining operations to extract mainly cassiterite (tin) and possibly tantalite and tungsten at Musha and Ntunga concessions.
By the fifth year of the licence, the company expects to increase its minimum production level from 50 tonnes of refined minerals to 120 tonnes per month.
Addressing the media after the signing, Imena said Musha and Ntunga were discovered in the 1930s and were mainly exploited in semi-industrial manner.
“In 2006, when government privatised all the mining operations in the country, all the private operators were granted licences to exploit those mines,” he said. “Unfortunately, they didn’t fulfil the contractual obligations, leading to cancellation of the licences in 2011.”
“For the first time since 2006, we have tendered mining concession in Rwanda and the process has been well-conducted and we are looking for suitable investors. We are glad Pella has come on board to exploit the untapped mineral potential in Rwamagana District.”
Imena said the deal offers a big opportunity for the country to enhance mineral sector development and transform the lives of nationals through employment opportunities.
He said there are more than 548 active mining sites in the country producing between 600 and 700 tonnes of minerals on a monthly basis.
“Rwanda is committed to triple the mineral sector production by 2017, and having such an important company investing in the exploration, exploitation and processing of minerals, we believe we are on track to achieving our objectives,” he said.
The 2013 US geological survey report on commodity tanked Rwanda 4th producer of tantrum in the world.
Nziratimana said the company targets to create employment opportunities and transform the livelihood of the surrounding communities.
“Rwanda has potential for mineral development and investors have huge prospects in the sector. We are committed to using our expertise and technology to exploit the untapped mineral potential, especially tin in Musha and Ntunga areas,” he said.
Nziratimana said Pella Rwanda Resources Ltd will start construction and processing after eight months because they have to first produce the social impact assessment report to ensure occupational safety of the workers and nearby communities.
Akamanzi said: “Rwanda has several types of mineral deposits in which we look forward to working with our partners like Pella Resources Ltd to develop and enable more investments, as well as explore additional opportunities not yet discovered.”
The mining sector is steadily becoming one of the country’s biggest foreign earners, fetching $136.6m (about Rwf86.7 billion)–only second to tourism–last year. The government targets $407m (Rwf268.6 billion) from mineral exports by 2017.
The country produces about 8,000 to 9,000 tonnes of mineral compounds annually, and ranks eighth in the world for non-molten tin, which translates into 1.5 per cent of global tin production.
In 2011, Rwanda adopted a mineral tagging and sealing scheme, the iTSCi project, that traces origins of all minerals.
iTSCi is an international tin supply chain which aims at ensuring traceability of tin.