Uganda-China collaboration to revive Katwe Salt Project with US$736.5 million

A joint venture between Uganda’s Rwenzori Salt Industries and Chinese company Shining Star Group is seeking to invest Ush. 2.7 trillion (US$736.5 million) to revive the Lake Katwe Salt Project in Kasese District.

According to reports by Business Focus Uganda, the JV known as Rwenzori Shining Stars Limited will utilize the salt brine as a raw material to produce between 50,000-100,000 tons of salt per year.

In addition, they will produce phosphate for fertilizer production, glasses, batteries and chlorine for treatment of National Water and Sewage Corporation-NWSC plants.

The consortium was established following an investment agreement that was signed in April 2018 by the two parties, with Rwenzori Salt Industries holding 49% stake in the company and Shining Star Group with a shareholding of 51%.

After getting an exploration license from the Ministry of Energy in November 2018, the company proceeded to do exploration and a commercial feasibility study was later completed in 2019 by Deloitte & Touche Company.

The Mayor of Katwe Kabatooro Town Council John Bosco Kananura says the agreement allocates only a section of the lake for this investment to allow the local artisan miners to continue with their activities who will also feed the factory will raw materials.

The investment is aimed to improve social corporate responsibilities, employment and purchasing power.

The government development agency Uganda Development Corporation- UDC built a factory in the 1980’s but construction was interrupted by the wars of the period and later works resumed in 1982.

However, operations of the facility did not last than two years on grounds of mismanagement and salt corroding the machinery.

Lake Katwe located west of Kampala is one of Uganda’s biggest salt mining lakes but the country continues to spend heavily on imports of edible salt, especially from Kenya.

According to reports by Daily Monitor, the country imported Ush 94.7 billion (US$25m) worth of salt for the year ended December 2019, increasing from Ush 43 billion in 2010.

However, there have been efforts to boost local production with the launch of a new salt production faculty – Kampala Salt – in Namagunga, Buikwe District.

The factory has a production capacity of 30 tonnes per hour and over 192,000 tonnes of salt annually but currently focus on producing salt for animal consumption with plans to start production of edible salt expected soon.

The global edible salt market was estimated at US$16. 6 billion in the year 2020 and is projected to reach US$19.6 billion by 2027, growing at a CAGR of 2.4%, indicates ReportLinker.

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