State’s Sh125bn dilemma over Titanium dip

The dwindling reserves of commercially viable titanium ore in Kwale County now pose a significant challenge to the government’s ambitious goals for the mining sector.

The State Department for Mining’s 2023-2027 strategic plan outlines an objective to boost revenue from the sector from Sh15 billion in the 2023/24 financial year to Sh125 billion by 2027/28.

This revenue growth is expected to be driven by accelerated mineral development, enhanced promotion, and increased value addition, which form the primary focus of the plan’s key result area (KRA).

However, the announcement by Base Titanium regarding the exhaustion of titanium ore reserves in Kwale County has cast doubt on these expectations.

Titanium mining accounts for 65% of the nation’s total mineral output.

Base Titanium is currently undertaking land rehabilitation efforts at its former mining site. To support this, the ministry has granted a 15-year contract extension.

Earlier, the company had issued redundancy notices to its employees due to the exhaustion of the ore reserves.

The miner’s final export shipment departed on February 12, 2025, closing a decade-long chapter during which the country earned billions from overseas sales.

“The State Department for Mining aims to grow the mining sector’s contribution to the GDP from the current 0.8 percent to over 10 percent by 2030 through enhanced exploration, mineral development, and value addition,” the strategic plan partially states.

In addition, the Voi Gemstone Centre has been renovated, with its trading booths now leased out.

Besides this, the National Mining Corporation the government’s investment arm for the mining sector has been operationalized.

Efforts are also underway to establish other mineral value addition facilities, including the Kakamega Gold Refinery in Kakamega County, a Granite Processing Plant in Vihiga County, and the revival of the Fluorspar factory in Elgeyo Marakwet County.

"These initiatives are expected to significantly increase the mining sector’s contribution to the economy," the plan notes.

The 2025 Economic Survey indicates that the impact of the titanium ore depletion is already evident, with the mining sector shrinking by 9.2% in 2024, worsening from a 6.5% contraction in 2023.

“The total value of minerals produced declined from Sh33.8 billion in 2023 to Sh25.5 billion in 2024, largely due to decreased earnings from titanium ore,” the report states.