British Firm Unearths Sh683 Billion Gold Reserve in Kakamega
Economically, the project is set to pay annual royalties ranging from Sh560 million to Sh610 million to the government, in addition to a Sh195 million Mineral Development Levy
Mining will be by the use of the Long Hole Open Stoping, LHOS, method that allows for selectivity of ore and causes minimal disturbance to surface level. Photo/Courtesy.
By Ruth Sang
A British-owned company, Shanta Gold Limited, has announced the discovery of one of Kenya’s largest gold deposits to-date, valued at around Sh683 billion, in Kakamega County. The company estimates that mining operations will require roughly 337 acres of land, mostly under private ownership, and would likely displace about 800 households.
The company has proposed a total of six potential resettlement sites on 1,932 acres to address the expected displacement by offering monetary compensation or relocation within the same locality to affected families.
The gold firm, through its local subsidiary Shanta Gold Kenya Limited, has confirmed the presence of 1.27 million ounces of gold in its Isulu-Bushiangala underground mining project in Kakamega South Sub-county. This is according to an Environmental Impact Assessment report filed with the National Environment Management Authority, entitled Shanta Gold West Kenya Feasibility Study: Isulu-Bushiangala Underground Mining Project, prepared by Current Technologies Limited in conjunction with South Africa’s Digby Wells Environmental.
The proposed project entails the development of a major underground mine at Musoli and Isulu areas about 55 kilometres northwest of Kisumu. According to the scoping study, the inferred mineral resource in the Isulu and Bushiangala deposits stands at 1,270,380 ounces of gold at an average grade of 11.43 grams per tonne, one of the most valuable mineral discoveries ever made in Kenya.
Shanta Gold Kenya Limited was incorporated in 2010 and is wholly owned by the London-listed parent firm. The company is now applying to NEMA for consent to begin underground mining and construction of a processing plant. Mining will be by the use of the Long Hole Open Stoping, LHOS, method that allows for selectivity of ore and causes minimal disturbance to surface level. After extraction, mined-out voids will be filled with cemented aggregates to prevent subsidence and ensure ground stability.
Key infrastructure for the project will cover the 1,500 tonnes per day processing plant, waste rock dumps, tailings storage facility, administration, and a 12-megawatt power plant. Even though there are potential environmental and social impacts, the EIA report indicates that these will be minimized through good management and community consultation.
SGKL General Manager Jiten Divecha said the vision for the company was to develop a world-class, safe, and sustainable mining operation. The projected lifespan for the mine is eight years, though further exploration could extend that time. The estimated capital investment for the project stands between Sh22 billion and Sh27 billion, with annual operating costs of approximately Sh2.5 billion.
Economically, the project is set to pay annual royalties ranging from Sh560 million to Sh610 million to the government, in addition to a Sh195 million Mineral Development Levy. Under Kenya’s mining laws, three per cent of gold sales will be remitted as royalties—20 per cent to Kakamega County and 10 per cent to local communities. Shanta Gold has also been sharing 1 per cent of total gold output directly with host communities under the Mining Community Development Agreement regulations.
The discovery has stirred optimism in Kakamega, a county that has traditionally relied on agriculture and small-scale mining, with local leaders saying the project may transform the region’s economy through job creation and improved infrastructure.
However, there are also grumblings from some locals regarding land acquisition, the issue of compensation, and environmental hazards. The EIA captures public concerns on probable forced evictions, loss of ancestral lands, and water-body contamination. The company has pledged land purchase in accordance with Kenya’s Land Act (2012) and international standards for resettlement to ensure it is open and fair.
Environmental experts have warned of potential impacts on the Yala and Isiukhu river catchments, both draining into Lake Victoria. The company has pledged to continuously monitor water quality and responsibly manage stormwater, dust, and chemicals.
Besides, the mine borders the ecologically sensitive Kakamega Forest, which is a region where biodiversity protection must be strictly exercised. The report calls for controlled vegetation clearance, progressive land rehabilitation, and community involvement in conservation. A final decision by NEMA on this matter will finally see Shanta Gold proceed to mine development and possibly turn Kakamega into Kenya’s newest hub for large-scale gold mining.
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