The government has put 102 companies on notice that it will withdraw their dormant mining licences, which were awarded between 2006 and 2012.
The licence holders have a month to show why they should not surrender the permits, minister for Energy and Minerals Sospeter Muhongo confirmed yesterday.
“They have up to October 9 to operationalise the dormant licences or the government will repossess and give them out to companies capable of rolling out the mining activities for which they were issued,” he told The Citizen on Saturday.
Sections 36 and 52 of the mining code provide for prospecting work to begin within three months of receiving mining rights. The firms must also stick to mining operations.
Permanent Secretary Eliakim Maswi issued the notice on Monday in a move seen as a clampdown on individuals who get mining licences only to turn around and hawk them to international prospecting firms for profit running into hundreds of millions of shillings.
Many of the speculators are influential politicians, businessmen and well-heeled individuals out to profiteer from the country’s huge mineral deposits. There has been widespread criticism of the manner in which the licences are given out, with claims of corruption.
Yesterday, Mr Muhongo said 98 per cent of the 102 licences are owned by Tanzanians who cannot develop them. Mr Maswi put the figure in Dar es Salaam at 94 and one in Boston in the US. The rest are spread in other areas of the country.
The government is concerned about the loss of revenue through hoarding of the licences, according to the minister.
At Mererani, for example, locals own 597 licences but only 10 pay taxes. Some of them sell to foreigners. Mr Muhongo reiterated that those who fail to implement the government’s order will have their mining blocks revoked.
In recent days, the minister and influential businessman Reginald Mengi have gone head to head over the ministry’s stance on gas, fuel and mining block licences.
Mr Mengi has pushed for a delay in issuing gas exploration licences, arguing that new policies should first be aligned with local participation and ownership in the lucrative industry.
But the minister has advanced the view that licences should be granted to those with the capital and technical know-how to develop the sector within the set deadlines and in keeping with national growth objectives.