Kenya will re-advertise the mining rights at Lake Magadi in Kajiado County after ending Tata Chemicals’ contract, President William Ruto has said.
Ruto said the decision ends what he described as an “exploitative and extractive” arrangement that has existed for nearly 100 years, arguing that Kenyans, particularly residents of Kajiado, have not received a fair share of the wealth generated from minerals extracted from their land.
“The challenges we have in Magadi, and the exploitative contract that has been in place for 100 years, cannot continue anymore,” the president said.
The President said the government will open the Magadi mining rights to new operators and will no longer allow one company to monopolise operations in the area.
“We are going to re-advertise the rights so that other companies can apply, because the resource we have is enough for more than one company,” he said.
Under the new arrangement, investors will be required to establish processing and manufacturing facilities in Kenya instead of exporting raw materials.
Ruto said the government’s plan is to promote local value addition, create jobs for young people, increase benefits to Kajiado residents and support the growth of local industries.
“We will also not allow the export of raw materials that leaves Kenya with little value while wealth and jobs are created elsewhere. Companies that win the new Magadi contracts must establish processing and manufacturing facilities here in Kenya,” he stated.
The announcement follows remarks Ruto made on Thursday during his development tour of Kajiado, when he told Tata Chemicals Magadi to “pack up and leave” and said new investors would be expected to establish glass and chemical plants in the county.
Commercial soda ash production at Lake Magadi dates back to 1911. Tata Chemicals, part of India’s Tata Group, acquired the operation in 2005 after buying Brunner Mond.
The dispute between the government and Tata Chemicals escalated in July when the Ministry of Mining, Blue Economy and Maritime Affairs directed the company to suspend mining and exports pending a compliance review.
The review covered issues including royalty payments, export reporting and local value addition.
Ruto said the fresh tender will give more investors an opportunity to participate while placing greater emphasis on local manufacturing.
The President has also indicated that the government plans to limit the amount of land occupied by a single operator and return a significant portion of the area to local residents.
