DIAMOND SPONSOR INTERVIEW: “Base Titanium’s key message is to show the world what is possible to achieve in Kenya”

Joe Schwarz, Base Titanium, Kenya Mining Forum1) Let’s start with some background on Base Titanium as a company.
Base Titanium (“Base”) is a wholly-owned subsidiary of Australian and UK-listed resources company, Base Resources Limited (ASX and AIM: BSE). Its flagship development is the Kwale Mine in Kwale County, 50km south of Mombasa.

Base completed construction of the Kwale Project infrastructure at the end of 2013 and the first bulk shipment of ilmenite was despatched from its privately owned and operated storage and ship loading facility in Mombasa in February 2014. The mine is currently producing up to 450,000 tonnes of ilmenite; 94,000 tonnes rutile and 38,000 tonnes of zircon each year.

Signalling Base’s position at the forefront of Kenya’s mining industry, official statistics showed that in 2016 the Kwale Mine represented close to 60% of the of the country’s total mineral output value.

In July of 2017 the Kwale Mine was awarded official flagship status by Kenya’s Vision 2030. This is a proud achievement for the company and represents a significant milestone in the partnership between the Government of Kenya and Base in promoting further development of the sector.

2) What has been a highlight in terms of projects for the company thus far?
There have been many stand out highlights since acquiring and developing the Kwale Mine – the rapid and successful development of Kenya’s first large-scale, modern mining project, plant commissioning and ramp up, a justifiably proud safety record, upskilling and developing our Kenyan workforce and our community development programmes. To this list we can now add environmental rehabilitation.

Ensuring a safe workplace always comes first. Creating, maintaining and continuously improving a safe and healthy working environment for our employees and communities forms a cornerstone of our corporate culture. The last lost time injury was recorded 43 months ago and 10.4 million injury-free man hours have been worked since. This impressive safety record is not left to chance. It is testament to continuous training, hazard identification and elimination and awareness – a culture that is deeply ingrained and continually reinforced.

Located in Kwale County, the mine is Kenya’s first large-scale mining operation and the county’s first industrial development. Despite limited skills availability, through Base’s prioritised employment system and heavy investment in training, 65% of employees working at the sites are local. To further ensure transfer of skills and develop manpower for the mining sector, Base works closely with local educational and training institutions to implement a number of external training opportunities including graduate, apprenticeship and internship programmes. Through these we are exposing Kenya’s youth to skills needed for employment in a new sector in Kenya and equipping them with the skills necessary to drive its growth.

Also strongly highlighted are our community programmes, which include provision of social infrastructure, investing in sustainable livelihood programmes centred on agriculture and a variety of health and education programmes.

3) Which projects that you are involved in are you most excited about at the moment?
The past 12 months has been a busy time for Base Titanium. An exploration programme was completed and results have been positive. Further assessment will determine whether the reserve will increase sufficiently to extend the mine life. Further exploration is planned for 2018.

Additionally, Base Titanium has commenced a mine optimisation project that will increase heavy mineral concentrate feed to the mineral separation plant, and therefore maintain final production volumes at around current levels for the remaining life of mine by increasing mining rates as ore grade declines.

4) How promising is the mining industry in Kenya?
Kenya’s mining industry is still in its infancy. However, recent initiatives spearheaded by Cabinet Secretary Dan Kazungu, including the enactment of new mining legislation and regulations point to a concerted effort by the Government of Kenya to promote the industry as a new growth sector. Kenya is a relatively under explored mining jurisdiction with unknown potential. However, the government has taken a visionary decision to invest in an extensive airborne geophysical survey aimed at encouraging future exploration.

The potential, however, for the mining sector to be a significant contributor to economic growth and development is clear. In an assessment by Ernst & Young on the economic impacts of Base’s Kwale Mine it was found that for every direct job created on the mine site a further four jobs were supported in the wider economy. Additionally, the assessment found that while Base paid US$14.5 in taxes in 2016 a further US$5 million was contributed to government revenue as a result of Base’s spending with local suppliers and consumer spending by employees and supplier employees.

5) What in your view are the main challenges?
The biggest challenge for Kenya is to create a competitive, stable and predictable investment climate capable of attracting serious investment interest, particularly in the exploration sub-sector.

6) How important is the updated Mining Act in your opinion?
The new Mining Act is a strong signal that the Government of Kenya is serious about developing the sector and increasing its contribution to the national economy. Provisions in the Act to ensure stability and predictability are reassuring to investors. It is also encouraging to see an Act that legislates the sharing of royalty revenue with local communities and county governments.

7) What will be you message at Kenya Mining Forum?
Base’s key message is to show the world what is possible to achieve in Kenya. By showcasing the successful development and operation of the Kwale Mine and the strong cooperation and commitment received from the Government of Kenya, we hope to be viewed as a catalyst for further investment in the country’s mining sector. Another key message is to demonstrate to potential investors the efforts being undertaken by the government to facilitate growth of the mining sector. Central to this is the Mining Act 2016, but other initiatives are equally important; for example the plan to conduct the aerial geophysical survey, the huge investments being made in infrastructure and the drive to lower the cost of energy through increased production and improved delivery.