Tanzania maintains stance on gold miner’s mining licence suspension

The meeting, which followed Mr Mavunde’s visit to inspect the company’s operations and engage with the local community, revealed that the government was unsatisfied with the benefits derived from the mine.

After consultations with both PMM and its counterpart, CANACO, the companies involved in the mine’s operations, Mr Mavunde stressed the importance of ensuring that the country’s natural resources benefit local communities. 

He noted that the people of Nyasa, Handeni, and the nation at large had not seen any meaningful benefits for an extended period.

In a bid to resolve the issues, Mr Mavunde gave PMM Tanzania Limited 30 days to submit both financial and technical reports to demonstrate the company’s capacity to operate the mine in accordance with the legal standards required.

“The government will not renew the licences until the necessary steps are taken. We have agreed that by May 7, 2025, PMM must submit a comprehensive report, including financial and technical details as required by law for the continued operation of the mine,” Mr Mavunde said.

The minister added that the law stipulates that those operating the mine must prove they have the financial resources, amounting to over 30 billion Tanzanian shillings, as outlined in the project documentation. This proof must be reflected in the company’s records and submitted to the ministry of Minerals within the set deadline.

Mr Mavunde further instructed the mine’s owners to ensure that if the company is unable to operate the mine within the 30-day period, they must inform the government and provide a qualified investor capable of managing the mine’s operations effectively. If no solution is found, the government will initiate procedures to attract other qualified investors.

The minister also directed the Handeni District Commissioner to establish a process for tracking and disbursing the two per percent of the proceeds from initial gold sales, ensuring that the funds are allocated to a special account for small-scale miners who vacated the mining areas as part of the earlier agreements.

In his address, Mr Spendi Ulimbakise, the Director of PMM Tanzania Limited, said that the company is ready to commence production but has faced challenges, including delays in receiving approval for their work plan and difficulties caused by heavy rainfall at the mining site.

He explained that critical information, including the approved work plan, had not been provided, and forcing them to restart the process with the ministry.

However, Ulimbakise assured the public that the company is now ready to begin mining, pending government support. He added that studies show the mine has sufficient gold reserves.

The Permanent Secretary of the ministry of Minerals, Mr Yahaya Samamba, countered Ulimbakise’s claims, saying that the investor’s reasons for delay were not valid. He clarified that some tasks in mining could proceed without waiting for government guidelines and that the Magambazi Mine’s work plan had already been established.

Mr Samamba said that the ministry had requested operational reports from all mining companies, including PMM, to show how much gold had been mined. He emphasised that this does not prevent mining activities from continuing, as the information is part of routine operational monitoring.

The Handeni District Commissioner, Mr Albert Msando, highlighted the adverse effects of ongoing conflicts at the mine, including loss of employment opportunities, hindered development, and inadequate access to essential social services such as clean water and quality education.

He called for decisive action, stressing that the government should not allow an investor to operate a mine that fails to provide the community with basic services, especially when there is a potential for significant economic benefits.

Mr Fredy Nkwabi, the discoverer of the Magambazi Gold Mine, which is claiming two per percent of the production proceeds, urged the government to ensure that they receive their rightful share.

Mr Nkwabi pointed out that the small-scale miners depend on this compensation to support their livelihoods.

He revealed that they had taken the matter to court, won the case, and were legally entitled to the payments but had yet to receive any compensation from the current mine operator.

The Magambazi Gold Mine was first discovered by small-scale miners in 2003, after which they were removed and handed over to Canaco Tanzania Ltd.

The mine later changed ownership to Tanzania Gold Fields and is now operated by PMM Tanzania Limited. However, the mine has been at the centre of ongoing disputes with the government, primarily due to delays in mining activities.

With the government now taking a firm stance, stakeholders will be closely watching how the situation unfolds over the next 30 days.