Row over permits robs Migori gold of its glitter

What you need to know:

  • Kenyan mineral exploration company, Mid Migori Mining Company Ltd, and its partner, London-listed firm Red Rock Resources Plc, are challenging a decision by the Cabinet Secretary, Ministry of Mining, revoking the Special Licence, held by (Mid Migori Mining Company).
  • Among the grounds for the revocation was that Mid Migori has held the areas for over 26 years without concluding the exploration programme.
  • Further, that the firm had never done any exploration work since it was granted the licences and that “it has only been getting into joint ventures. It has all along been an intermediary.”

Gold mining in Migori County has been thrown into disarray following a row over special licences granted to a local firm for exploration in the area.
On one hand are two firms that say they have been denied permits unfairly, while on the other is the Mining ministry and the county government which complain that 26 years that the firms have held on to the land is a long time and the land needs to be used for development projects that benefit locals.

Kenyan mineral exploration company, Mid Migori Mining Company Ltd, and its partner, London-listed firm Red Rock Resources Plc, are challenging a decision by the Cabinet Secretary, Ministry of Mining, revoking the Special Licence, held by (Mid Migori Mining Company).

The secretary had upheld an earlier decision by the Ministerial Licensing and Advisory Committee (MLAC), which annulled the permit.

According to Mid Migori and its foreign partner, a letter to them dated January 2015 did not notify them of the earlier decision by MLAC to revoke the Special Licences but was simply a notice to show cause as to why it should not be revoked.

“Any decision made was, therefore, erroneous and had no factual basis,” the firms told the court.

Among the grounds for the revocation was that Mid Migori has held the areas for over 26 years without concluding the exploration programme.

Further, that the firm had never done any exploration work since it was granted the licences and that “it has only been getting into joint ventures. It has all along been an intermediary.”

The company had been obtaining renewals of licences through promises of heavy investment in exploration work but which have never been honoured, the court heard. The ministry also blames Red Rock for the alleged non-performance by its partner, on account of its shareholding in the latter.

Mid Migori and Red Rock, however said a separate letter sent to them in April, 2015 had ignored the grounds for the notice to show cause set out in the letter dated January the same year, and the fully adequate responses they had given through correspondence and at the meeting between the firms’ officials and those from the Ministry held in March, 2015. 

The companies said that they had also not received an opportunity to adequately respond to some of the decisions.

In addition, the firms said the Ministry ignored the fact that Mid Migori had applied for a mining lease on August 14, 2012 and that the progress of the said application stalled prior to and during the period in which the country’s general elections were conducted after which the Ministry ignored letters and discussions referring to the application.

“Ultimately, if the licence renewal documentation had been issued in 2013, as had been previously indicated by the Ministry, we would have carried out our programmes to completion in a timely fashion and this would have in turn enabled us to submit a second mining lease application,” the two firms told court.

Acted illegally

The firms said the mining ministry had also acted illegally in light of the fact that the area which another firm, Ngira Exploration and Mining Works Ltd, had been authorised to operate, fell under the exclusive prospecting licence under Mid Migori Mining Company’s special licences ,they said.

The Commissioner of Mines and Geology has however maintained that it is statutory mandated to independently exercise State powers with respect to matters of mining and told court that to prohibit it will interfere with its constitutional and statutory powers.

The Migori County government on its part has thrown its weight behind the ministry’s decision through the Cabinet secretary, saying that special licences were granted subject to special conditions, covenants and restrictions, but which Mid Migori Mining failed to comply with, hence the revocation of the licences.

The county said mining sites in question are held on ancestral community land and such land is classified as community under the Constitution, and it is held in trust of the people of Migori by the regional government.

“The exploration activities have been carried out to the exclusion, participation and benefits of the local community and the land owners contrary to article 69(h) of the Constitution which provides for utilisation of the environment and natural resources for the benefit of the people of Kenya,” said the county.

Migori said the Mining Act requires that where the prospecting rights are in respect of a location which is situated in trust land, “no such renewal shall be granted except with the consent of the county government” within whose jurisdiction such trust land is situated.

“Failure by Mid Migori Mining Company to conclude the exploration works in the last 20 years, hinders Migori County government’s ability to effectively perform its roles as obligated by the Constitution, particularly implementation of specific national government policies on natural resources and environmental conservation, including soil and water conservation and forestry which do occur on community land,” said the county.

The county said the State reserves the right to regulate the use of any land or any interest in or right over land in the interest of the public. Further, that any investment in properties should benefit the local community and their economies.