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Small scale miners irked by delayed multibillion programme

10th October 2010

Small scale miners have claimed that the multibillion project aimed at transforming artisanal mining into small scale mining in troubled Tarime gold’s belt is proving to be another white elephant, just two years since the government embarked on the programme.

The project initially introduced by African Barrick Gold in mid 2008 as one of the company’s payback initiatives, whereby among other things, it agreed to invest about $2.5 million, is facing major stumbling blocks at the Ministry of Minerals and Energy.

But contacted by The Guardian on Sunday, the Minister for Minerals and energy, William Ngeleja, strongly denied claims that his ministry has purposely delayed the project, adding thousands of small scale miners to remain calm as the government finalise plans to supply them with modern equipments.

“The project is still going and we have already contracted about four companies that will supply all required modern mining equipments to small scale miners…before the end of November hopefully the equipments will be available.” The Minister assured small scale miners.

The minister insisted that the project wasn’t only targeting small scale miners in North Mara, but would also cover the entire country especially in those areas where there are artisan mining activities.

But speaking to The Guardian on Sunday early this week in Nyamongo gold belt, the Chairman of Tarime Small Scale Miners Cooperative Society, an umbrella organization established to spearhead the project, Peter Makoma said, “We have waited in vain for so long…some of our members have pulled out of the project following the delay.”

“We have visited the ministry’s offices several times but it has been just a dilly-dallying and we think the government erred in hijacking what was originally introduced by our donor, African Barrick Gold.” The Chairman told The Guardian on Sunday.

According to him, though his Cooperative society, which is the second in Africa after the similar one formed in Ghana two decades ago, was registered as required by the law, no any single shilling has been issued by the ministry to finance project.

“We are informed that the World Bank issued millions of dollars to the ministry in order to fund this project, but surprisingly nothing has been allocated to us.” The Chairman claimed. The Cooperative is expected to have 1,500 active members and would create about 3,000 additional jobs in the region where local communities have battled large scale foreign investors for a decade and half, after they were forcibly evicted from North Mara gold mine.

It’s alleged that the WB decided to finance the project under conditions that the government should be directly involved, because the bank’s policies don’t allow it to operate that kind of a project with foreign investors like African Barrick Gold.

“We were against this idea because the same government that failed to support us for five decades lacks credibility and the will to do so today…However after various stakeholders consultative meetings, we agreed to work with the government.” An annoyed Chairman explained to The Guardian on Sunday.

Among other things, the project was originally aimed at providing modern technology suitable for small scale mining in Africa as well as starting capital for mobilisation of resources.

Small scale miners would have also been educated on safety, environmental conservations and access to the market, before being given technology to mine gold in their designated areas.

African Barrick Gold through his former Chief Executive Officer, Gareth Taylor, was at the last stage of contracting a South African firm to supply modern technology suitable for small scale mining, when the government ‘hijacked’ the multibillion shillings project.

Since then, the company has put on hold its $2.5 million initial funds, pending the government and World Bank move after the two took over the control of the project.

The government has revived its defunct State Mining Corporation (STAMICO), and tasked it with responsibilities to supervise all small scale mining activities in the country.

“What we need mainly is technology to mine gold because we have enough human resources and probable gold reserves but our biggest obstacle is lack of modern mining equipments.” The Chairman added

According to the Chairman, some small scale miners have threatened to join the notorious intruders who have been invading the Barrick’s North Mara Gold Mine several times, if the project won’t takeoff.

By the end of 1995 there were about 400,000 artisan miners in Tanzania, but the numbers had tumbled to 20,000 by 2000 when the government under the direction of the World Bank opened its doors to large-scale mining production.

With broad introduction of multinational firms, artisan miners lost legitimacy and were all but boxed out of the business, and the new mining act is said to address that issue directly. According to proposed Mining Act of 2010, small scale miners will be legally recognised and given surveyed mining areas, as well as supported with financial services and training.

Under the New Mining Law of 2010, small scale mining will only be done by locals. Based on Botswana's legal framework, Tanzania will use its state mining company STAMICO to provide technical and business support to thousands of local miners.

Where exploration has been carried out by large-scale mining firms and established that the available minerals are not viable economically for large-scale mining, the new Act requires the area to be relinquished to small-scale miners within a period of three months.

Under this law, STAMICO will also assist small-scale miners in conserving the environment and will help them to access capital from local banks after securing mining licences.

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