World Markets

Uganda seeks investor to revive defunct copper mine

Uganda is seeking an investor to revive copper and cobalt production at a defunct mine and will soon start a tender process to find one, the vice president said on Thursday.

KAMPALA, Oct 21 (Reuters) - Uganda is seeking an investor to revive copper and cobalt production at a defunct mine and will soon start a tender process to find one, the vice president said on Thursday.

Known as Kilembe, the mine was once a major producer of copper and cobalt but was abandoned by Canadian firm Falconbridge in the 1970s when Uganda's economy stagnated under the leadership of dictator Idi Amin Dada.

Vice President Jessica Alupo, who is on a tour of the mine this week, said she had directed the ministry of energy and minerals to immediately seek an investor.

"The Ministry of Energy and Mineral Development, within the shortest time possible, should advertise the Expression of Interest for an investor. Please let it be transparent," she said in a statement.

The mine's ore of about 4 million tonnes is estimated to be 1.98% pure copper and 0.17% cobalt, according to Uganda's Department of Geological Survey and Mines.

It sits on the foothills of the Rwenzori Mountains on the Uganda's border with the Democratic Republic of Congo.

Previous government efforts to revive the mine were stymied by a downturn in commodities markets and a failed 2013 deal with a Chinese investor which was eventually cancelled after years of slow progress and missed targets.

President Yoweri Museveni's government has been eager to expand revenues from the mining sector to help jumpstart slowing economic growth. Its current biggest mineral export is gold.

(Reporting by Elias Biryabarema; Editing by Ayenat Mersie and Angus MacSwan)

((Email:elias.biryabarema@thomsonreuters.com; Tel. +254 20 499 1232; Reuters Messaging: elias.biryabarema.thomsonreuters.com@reuters.net))

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