Investors eyeing Kenya’s mining sector will have to make do without concrete data on the country’s mineral wealth after plans for an aerial survey collapsed.
In a move that plunges the Kenya Nationwide Airborne Geophysical Survey project into deeper uncertainty, mistrust of China’s prominent role in the survey has instigated a bitter falling out, prompting the Exim Bank of China to withdraw $65 million in funding.
On its part, the Kenyan government has frozen the contract awarded to Chinese firm Geological Exploration Technology Institute to carry out the survey.
This development exposes taxpayers to a $20 million fine for breach of contract.
The falling out became imminent after the government brought on board the National Intelligence Service to manage, co-ordinate and supervise the project after mining stakeholders protested that entrusting the survey to the Chinese could result in manipulated and compromised data.
Ironically, British and Canadian consultancy firms International GeoScience Services and Paterson, Grant and Watson had already won the consultancy contract to oversee the survey.
Petroleum and Mining Cabinet Secretary John Munyes lifted the lid over the cancellation when he appeared before the Parliamentary Energy Committee, saying that the project is now solely in the hands of Kenya to implement. He, however, remained cagey about the country’s ability to undertake the complex process using only local geologists.
Although the minister said Kenya will resume on the project in the next three months, the government must find a way to raise $65 million after the National Treasury allocated only $5 million in the current budget for the survey whose total cost is $70 million.
While the government has put its faith in local experts, the reality is that no local company has the capacity in terms of human capital and equipment to undertake the job.
According to the Geological Society of Kenya, the country has about 1,000 geologists, majority of whom work in the field of hydro-geology.
The airborne survey is critical because it was to provide a detailed geological map and mineral resource assessment.