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EU offers support to iron ore exploration unit

Iron ore

Kampala, Uganda | THE INDEPENDENT | The European Union has offered Euros 800,000 (about Shillings 3.5 billion) to Uganda to develop an iron ore exploration unit in the Department of the Geological Survey and Mines (DGSM) in Entebbe.

In a notice prior to commencement of the work, the EU says the money is given under EUAid and will help in developing mineral exploration policy, guidelines, and standards, an iron ore exploration manual, and a geological data management policy.

Also, the unit will be helped “in drilling 10 iron ore prospects and support the analysis of the drilling data.” The Finance Ministry says it is not yet accepting applications to develop the unit at this moment.

Iron and steel industry is an important industry flagged by the National Planning Authority as one that can earn the country hundreds of jobs but also save the country millions in foreign exchange spending.

According to the NPA, about 33% of the iron and steel production in Uganda is done from scrap and raw iron ore. This implies that 67% of the raw material for iron and steel making in Uganda is imported.

This is despite the fact that Uganda has said it has huge deposits of iron ore in the north of 200 million metric tonnes. A lot of these deposits are located in Tororo, Manafwa, Moroto, Kabale, Kanungu, Kisoro, Kiruhura, and Masindi districts.

NPA reported in 2018 that if only Tembo Steel Ltd and Pramukh Steel Ltd are supported to establish direct reduced iron (DRI) plants that are sponge iron production through smelting iron ore, at least 4,000 jobs will be created. The planning authority adds that “with their use of scrap to produce their products, the two companies save the country 3.4 trillion shillings in forex expenditure.”

In 2012, President Yoweri Museveni banned the export of raw iron ore saying the country was losing billions of shillings in the exports. The ban has stayed on since then although there are reports that some companies were flouting the ban.

Iron ore is used to make steel. In turn, steel is used to make automobiles, locomotives, ships, beams used in buildings, furniture, and paper clips. Other products include reinforcing rods for concrete, bicycles, and thousands of other items.

It is the most-used metal in the world by both tonnage and purpose.

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