Govt seeks Shs2.6bn tax waiver for Kilembe Mines

14 August 2026, 1:03 am

By Regina Lalam

Parliament: The Ministry of Energy and Mineral Development is seeking a Shs2.6 billion waiver on tax arrears owed by Kilembe Mines Limited as the government-owned company winds up its operations to pave the way for a new mining company.

Appearing before the Committee on Finance, Planning and Economic Development this week, the State Minister for Minerals, Hon. Sidronius Okaasai, said the arrears had accrued from unpaid annual mineral rents by Kilembe Mines Limited when it held the mining licence.

According to the Minister, the arrears were charged in accordance with Section 189 of the Mining and Minerals Act, Cap. 159.

The waiver request comes after the Government signed a new mineral production-sharing agreement in 2025 with a joint venture comprising:

• Sarrai Group Ltd
• Nile Fibreboard Ltd
• Uganda National Mining Company Ltd

The consortium has been contracted to explore, develop, produce and process minerals at Kilembe Mines in Kasese District.

Minister Okaasai told the committee that clearing the arrears is necessary to finalise the winding-up of the old Kilembe Mines Limited and allow the new investors to take over operations without legal or financial encumbrances.

The committee is expected to scrutinise the request and make a recommendation to Parliament.