Kenya Mining Act

Every mineral in its natural state in, under or upon land in Kenya; in or under a lake, river, stream, or water course in Kenya; in the exclusive economic zone and an area covered by the territorial sea or continental shelf is the property of the Republic and is vested in the National Government in trust for the people of Kenya.

In addition, the State has a right of pre-emption of all strategic minerals raised, won or obtained within the territory of Kenya before they are sold.

The Cabinet Secretary (CS) in charge of mining is responsible for the administration of the Mining Act and has powers to develop regulations that provide for activities in the mining life cycle. The law provides for a Mineral Rights Board that supports the CS on administration aspects such as granting and revoking licences, designating areas for small-scale and artisanal mining, and excluding areas from mining activity.

The CS can declare certain minerals or deposits to be strategic by advising and seeking approval of the Cabinet. The Act also establishes two directorates to assist with administration — the Directorate of Mines and the Directorate of Geological Survey.

The Act provides for both large-scale and small-scale operations. Large-scale operations are covered by prospecting, retention, mining and mineral processing licences. Small-scale operations include artisanal mining permits and small-scale mining licences with defined area and equipment thresholds.

The Act requires Mineral Right Holders to give preference, to the maximum extent possible, to materials, products, services and workforce from Kenya. Mineral Rights Holders must submit detailed programmes on recruitment and training of Kenyans; the approval of this programme is a condition for the granting of a mineral right.

Holders of mineral rights must develop a comprehensive community development agreement that secures socially responsible investment and provides employment preference for those living in communities around mining operations. The CS is expected to publish regulations under the Act on local content.

National Mining Corporation

The Act establishes a National Mining Corporation as the Government’s investment arm, with responsibility to ensure that mineral wealth is protected and harnessed for present and future generations. It is a body corporate with perpetual succession, and can invest on behalf of the Government, engage in mineral prospecting and mining, and hold interests in mining projects.

Mineral Rights Board

The Board advises and gives written recommendations to the CS on the grant, rejection, retention, renewal, suspension, revocation, variation, assignment, trading, tendering or transfer of Mineral Rights Agreements; on areas suitable for small-scale and artisanal mining; and on areas where mining operations may be excluded or restricted.

Directorate of Geological Survey

Consolidates government efforts in the collection and storage of geological data related to prospecting in a national repository; participates in various geological surveys including geo-environmental studies; and promotes private-sector interest and investment in mineral exploration.

Directorate of Mines

Supervises and promotes activities related to the development and exploitation of minerals and mineral resources, and takes the lead role in monitoring and enforcement through appointed inspectors of mines.

County Government

An office established by the CS for Mining represents the Ministry of Mining in the County Government. It is responsible for granting, renewing and revoking artisanal mining permits, maintaining a register of artisanal miners and maintaining fair trade. The office is headed by an officer who reports to the Director of Mines.

The Act provides for the payment of royalties by a holder of a mineral right to the State. The royalty payable is determined by the gross value of sales; the CS prescribes the rates of royalties payable.

Payments of royalties are filed with the Mineral Cadastre Office by the 5th business day of every month. Lack of payment within 60 days of filing is a ground for the licence or permit to be revoked.

Royalties collected are distributed as follows:

• 70% to national government
• 20% to county government
• 10% to the community where mining operations are carried out

The Act establishes a computerised mining cadastre and registry system, and a register of mineral rights. The system includes an online transactional facility to enable applications for granting and renewal of mineral rights to be submitted online. It is a public document open to inspection by any interested person upon payment of a fee.

The register contains details of each application, grant, assignment, transfer, notice, surrender, suspension and cancellation of a mineral right.

Any dispute arising as a result of a mineral right issued under the Act may be determined by the Cabinet Secretary, through a mediation or arbitration process as the parties may agree or as stated in an agreement, or through a court of competent jurisdiction.

Mining operations must comply with laws on water rights and use land in accordance with the terms of the permit or licence. Persons conferred with mineral rights are expected to comply with the Occupational Health and Safety Act.

Before a mining licence is granted, the applicant is expected to obtain an Environmental Impact Assessment, a Social Heritage Assessment and an Approved Environmental Management Plan.

The Act repeals the following legislation:

• The Mining Act, Cap. 306
• The Trading in Unwrought Precious Metals Act, Cap. 309
• The Diamond Industry Protection Act, Cap. 310

Any regulation made under the repealed laws continues to be in force so long as it is consistent with the Act, until revoked by the Cabinet Secretary.