The Drill

• Mining and Minerals Act, 2021, repeals the Mining Act, 2003.
• Introduces a competitive licensing regime for brownfields (existing mining projects) and retains first come, first served model for greenfields (new mining projects).
• A model mining agreement for large-scale mining businesses is introduced.
• Prospecting, exploration, and retention licences are retained, and the location licence is replaced with the small-scale and artisanal mining licences.
• A National Mining Company, more like the Uganda National Oil Company, is created.
• A traceability and certification scheme to eliminate smuggling of tin, tungsten, tantalum, and gold is established (3TGs), and will enable direct access to lucrative international markets.
• Royalty sharing revised with owners of land with minerals getting 5% instead of the old 3%.
• The Mineral Protection Unit is abolished.
• The ministry of energy and mineral development will publish on its website information about actual owners (beneficial owners) of mining businesses.
• Offenders of the law will pay fines ranging from Shs60–500 million or serve imprisonment terms of between 2 and 7 years or both. Some consider this harsh.
• Building substances (development minerals) such as sand, murram, clay to be regulated under a separate law.

Uganda passed the East African Crude Oil Pipeline (Special Provisions) Bill 2021 in December, one of the final major requirements that financiers of what will be the world’s longest underground heated crude oil pipeline needed before committing money to the project.

We speak to Dickens Kamugisha, the Chief Executive Officer of Africa Institute for Energy Governance (AFIEGO) and Peter Muliisa, the Chief Legal and Corporate Affairs officer of the Uganda National Oil Company to explain the law.