Eight mining firms are set to invest over $18.3 million, in a move expected to boost professionalism in a sector which is grappling with accusations of poor working conditions for miners.
The firms this week received the cabinet nod for 25 mining and quarrying licenses.
The firms which received approval will be involved in exploration, large scale mining, small scale mining and quarrying.
Piran Rwanda Ltd, a mining company from the UK, was granted two exploration licenses for four years.
The firm will be involved in the exploration of cassiterite, Coltan and Wolfram in Rwamagana District.
The firm has pledged an investment of $0.6 million for exploration.
Ngali Mining Ltd received three large scale mining licenses for exploitation of gold in Karongi District in a total area of 1200ha.
The firm will invest up to Rwf4.8 billion during the 10-year duration of the licenses.
Elion Minerals Ltd will invest up to $0.99 million for exploitation of wolframite in Ngororero District after receiving approval for three licenses.
Four firms received quarrying licences including a new entrant in the cement production. The firm, Prime Cement, will operate in Rubavu District injecting about $3.1m received nine licenses.
Rwanda Investment Group is also expected to invest $2.1 million in peat mining exploitation in Bugesera and Nyanza Districts.
East African Granite Industries had its license renewed for operations in Nyagatare District for the exploitation of Granite products where they will be investing over Rwf1.5 billion.
Cimerwa also committed a $3.4 million investment for four quarrying licenses in Rubavu sectors.
The new licensed firms reflect plans by the Government to only issue licenses to large firms with capacity to invest with the latest mining technology to undo persistent trends of artisanal and small scale mining.
Rwanda Mines, Petroleum and Gas Board Chief Executive Officer Francis Gatare told The New Times that the recent move seeks to change the trends in the sector which was previously characterised by artisanal practices.
He said that the new licensing approach, among other things, takes into account environmental risks, safety as well as reduction of productivity losses.
Rwanda Mining Association has previously said that, according to estimates, they only recover 30 per cent from the extraction process losing about 70 per cent due to artisanal practices.
Gatare said that the new licensing approach requires firms to have adequate capital for them to have adequate scale, have professional approach, impact on the sector as well as value.
Firms are henceforth required to sign contracts with the Government outlining milestones, including capital injections and productivity, he said.
The contracts are to make sure that they can be held accountable on the basis of financial investment, productivity among other aspects.
The new licenses are likely to see increased diversification of mineral outputs beyond the traditional minerals. For instance, the new licenses will see the production of industrial minerals such as peat which will power multiple operations.
The new licensed firms are also expected to create better quality jobs in the process of professionalisation of the sector.
For instance, the first batch of graduates from the University of Rwanda School of Mining and Geology will enter the job market in June this year.
The 150 graduates are expected to be absorbed by the firms.
Gatare said that with the increase in quality of players, there will be a better quality of jobs for young Rwandans.
Commenting on the concerns of safety of miners in light of a number of accidents that have claimed lives, he said that the Government will work with mining firms to ensure that avoidable accidents are prevented by ensuring standards among other ways.
Rwanda is projecting a sharp growth in its mineral export earnings in the current fiscal year on account of diversification, value addition and stability in international prices.
The country’s export earnings from minerals are projected to reach $800 million this fiscal year, up from $399 million in 2017/18.
This means that mineral exports will account for 38.7 per cent of all country’s export earnings.
The Government targets $1.5 billion in annual revenues from mineral exports by 2024.