TRANSFORMING UGANDAS MINERAL POTENTIAL INTO MINERAL WEALTH: ISSUES & OPTIONS FOR REFORM

Uganda Mineral Wealth Conference, Oct 2013 Sheraton Hotel-Kampala

Denis Kusaasira |Advocate LL.M Mineral Law & Policy, University of Dundee, Scotland-UK

THE MINERAL POTENTIAL OF UGANDA

Source: Joshua Tuhumwire presentations,

Denis Kusaasira |Advocate LL.M Mineral Law & Policy, University of Dundee, Scotland-UK

Mines & Money Conference, London 2008

Mineral Exploration is a high risk endeavor An exploration program costing $5.2 million carried out in northerly region of the Canadian province of Labrador over a 14,000 square mile area from 1953-1963. The results were as follows: Anomalies indicated by aerial surveys Anomalies evaluated on the ground Anomalies drilled Mineral occurrences located Mineral occurrences drilled Significant deposits located Economically viable discoveries Source: 2,000 947 182 69 25 4 0

Laughlin, W.H. 1980. Non-Fuel Mineral Exploration in Canada to 1985. Department of Energy, Mines and Resources: Ottawa. Mineral Policy Sector Internal Report MRI 80/21, p. 2.
Denis Kusaasira |Advocate LL.M Mineral Law & Policy, University of Dundee, Scotland-UK

Top 10 ranked Company Decision Criteria for exploration (out of 62 factors)

Fixed 1 2 3 Economic Policy Tax 4 5 6 7 8 Geological potential for target mineral Profitability of potential operations Security of tenure & permitting Ability to repatriate profits Consistency of mineral policies Realistic foreign exchange controls Stability of exploration terms/conditions Ability to predetermine environmental obligations

Mineral 9 Ability to predetermine tax liability Policy & Stability of fiscal regime Law : UN survey of10 Source 45 to mining companies; James Otto

Denis Kusaasira |Advocate LL.M Mineral Law & Policy, University of Dundee, Scotland-UK

Issues
GEOLOGICAL POTENTIAL FOR TARGET MINERALS Not singled out a target mineral Not done enough marketing of available data TAX POLICY Lots of front-loaded taxes which increase exploration and development cost, e.g., VAT Withholding tax on: Contractors & interest on loans Import duty, e.g., on exploration camps, etc., MINERAL LAW & POLICY Still has gaps that threaten security of tenure No clear rules for surface rights contracting

Denis Kusaasira |Advocate LL.M Mineral Law & Policy, University of Dundee, Scotland-UK

Options
GEOLOGICAL POTENTIAL FOR TARGET MINERALS Need to single out that target mineral to market Do enough marketing of available data TAX POLICY Remove front-loaded taxes which increase exploration & development cost, e.g., VAT Withholding tax on: Contractors Import duty on exploration Camps MINERAL LAW & POLICY Fill gaps that threaten security of tenure Provide clear rules for surface rights contracting

Denis Kusaasira |Advocate LL.M Mineral Law & Policy, University of Dundee, Scotland-UK