Kenya Mulls $50 Million Mineral, Oil Laboratory for East Africa

Freight Moves At Mombasa Port

Mombasa port, managed by the Kenya Ports Authority, the state-run company in Kenya.

Photographer: Trevor Snapp/Bloomberg

Kenya is considering whether a $40 million to $50 million mineral and oil analysis laboratory that would give the nation better access to its resources information should be privately run or government-operated.

“This will service the whole of East Africa, it’s in demand by industry as it reduces their costs and the time to process the data,” Mining Secretary Najib Balala said in an interview Thursday in the capital, Nairobi.

Companies including Tullow Oil Plc. have found oil in Kenya, which has an estimated 600 million barrels so far, while neighboring Uganda could hold 6.5 billion barrels.

Kenya is the world’s third-biggest producer of soda ash, used to make glass, and ranks sixth in output of fluorspar, used in steel, according to the U.S. Geological Survey. It also has deposits of coal, gold, rubies and sapphires. Randgold Resources Ltd., a producer of the metal in Africa, said last year it planned a study of Kenya’s gold-mining potential.

Balala said it was too early to say when the service would start as the report on the facility only landed on his desk Wednesday.

“Small issues” were preventing lawmakers from passing a Mining Bill that would provide policy stability, Balala said, without elaborating. Kenya ranked third from bottom on the Investment Attractiveness index published in the Vancouver, Canada-based Fraser Institute’s annual survey of mining companies last month.

Shortly after his appointment in 2013, Balala canceled 43 prospecting and mining licenses after saying the government discovered irregularities in the way they were granted.

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