KASESE, Uganda — Kilembe Mines Ltd. has officially transferred its assets in Kasese Municipality to the Uganda National Mining Company (UNMC) Ltd., paving the way for the resumption of copper smelting in Uganda after four decades.
UNMC Ltd., holding a 15% stake in the project, will manage Uganda’s commercial interests in the mineral sector. Following the handover, the assets will be transferred to contractors Sarrai Group Ltd. and Nile Fibreboard Ltd.
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Kilembe Mines ceased operations in 1982 due to a collapse in global copper prices, economic instability, and a lack of essential supplies. The mines have since been maintained to preserve underground shafts and prevent flooding.
“The list of assets and liabilities is being handed over to UNMC Ltd. Kilembe Mines Ltd has been dissolved, and all its business has been incorporated into UNMC Ltd.,” said Dr. Ruth Sengonzi, a board member of the now-dissolved Kilembe Mines Ltd., at the handover in Kampala on Thursday.
Sengonzi noted that Tibet Hima Mining Company Ltd. previously held a concession for the mine from 2014 to 2018. She added that the mine contains significant cobalt-rich material, estimated at 3.5 million tons grading 0.12% cobalt and 0.18% copper. However, she cautioned that recent flooding from the River Nyamwamba may have washed away some of this tonnage, requiring verification.
The transferred assets include core mining assets such as underground copper ore and materials left by Tibet Hima Mining Company Ltd., as well as non-core assets like a timber forest, a treatment plant, and real estate. Other assets include equipment and trucks from the previous concessionaire and assets under the National Enterprise Corporation (NEC), which was recently contracted to upgrade the mine. Unclassified assets, not clearly attributed, are yet to be verified.
Kilembe Mines Ltd. also has outstanding liabilities, including staff salaries and gratuities, unpaid National Social Security Fund (NSSF) contributions, Pay As You Earn (PAYE) tax arrears, Value Added Tax (VAT), income tax obligations, legal fees, and unresolved court cases.
James Mukasa Sebugenyi, board chairman of UNMC Ltd., confirmed the receipt of the assets. “We, together with Nile Fibreboard Ltd., duly acknowledge the asset handover. As per the agreed roadmap, we will finalize the audit, verification, and full physical receipt of these assets, without liabilities, between April 17 and 25,” he said.
Dr. Gerald Banaga-Baingi, UNMC Chief Executive Officer, described Kilembe Mines as a strategic national asset. “The formal transfer marks the beginning of a new chapter. It reflects the government’s trust in UNMC to protect and manage public interest during the redevelopment,” he said, adding that the revival promises economic revitalization, job creation, and regional growth, with a focus on commercial viability and sustainability.
State Minister for Mineral Development Phiona Nyamutoro stated that joint teams will conduct a physical verification of the assets after the full transfer, in line with the Mineral Production Sharing Agreement (MPSA). “This project will not only revive mining operations but also introduce value-added processing, positioning Uganda more competitively on the global minerals market. Most importantly, it will ensure that Ugandans benefit directly from their natural wealth,” she said.
The government resolved in 2018 to redevelop Kilembe Mines through a Mineral Production Sharing model, selecting Sarrai Group Ltd. as the partner through a bidding process. An agreement to spearhead the redevelopment was signed on March 3, 2025, between the Ministry of Energy, Sarrai Group Ltd., Nile Fibreboard Ltd., and UNMC Ltd.
