By Terryanne Chebet
Kenya will require gold to be refined at home and sold first to its central bank, as its first large-scale underground gold mine moves toward construction.Kenya will ban exports of unrefined gold and make its central bank the first buyer of local output, President William Ruto said on Sept. 14. “We are going to stop the export of gold from Kenya unless it is processed,” he said in Kisumu, adding that coltan and rare earths would follow
The announcement comes as Shanta Gold prepares to build the country’s first large-scale underground gold mine in Kakamega County, and the head of the mining sector at Kenya’s national chamber of commerce says the timing could make that mine harder to finance. The policy’s intent is positive, said Charles Komen of the Kenya National Chamber of Commerce and Industry, but the rules are arriving “before older frameworks have even been fully implemented,” leaving “some complication on the bankability aspect.”
What to know
- Ruto announced that Kenya will ban exports of unprocessed gold and make the Central Bank of Kenya the first point of sale for gold mined and refined in the country.
- The State Department for Mining estimates gold output at about 300 kilograms a month. Official statistics from the Kenya National Bureau of Statistics (KNBS) record a similar amount for an entire year: 329.1 kilograms in 2025, 358.5 kilograms in 2024 and 410 kilograms in 2023.
- Shanta’s Isulu-Bushiangala deposit holds 1.27 million ounces grading 11.43 grams per tonne, according to its feasibility filing.
- Tanzania and Ghana already run central bank gold-buying programmes, with reserve gains in both and losses in Ghana.
A deposit built on grade
The Isulu-Bushiangala deposits hold 1,270,380 ounces grading 11.43 grams of gold per tonne, according to the feasibility study Shanta filed with the National Environment Management Authority in November 2025. Across its Kenyan licences, including the lower-grade Ramula-Mwibona deposit to the west, Shanta reports 1.72 million ounces.
The deposits lie along the Lirhanda Corridor, which Shanta describes as a 12-kilometre structural trend on the eastern flank of the Kakamega Dome. The gold is carried in quartz and quartz-carbonate veins between half a metre and 10 metres wide, set within sheared volcanic rock, the company says.
That grade is what sets the Lirhanda Corridor apart, said Komen, who is also regional manager for Mizztech African Supplies in Kenya, Tanzania and Zambia. The indicated portion of the resource averages 11.45 grams per tonne, against the 1 to 3 grams he says is typical of the Lake Victoria belt, and about 30% of drill holes show visible coarse gold, “pointing to high-grade shoots.”
The same coarse gold creates the project’s main technical risk. “The main technical risk is the nugget effect,” Komen said. Because the gold sits unevenly in the rock, drill samples can overstate or understate what a block of ore holds, which complicates both estimation and the reconciliation of forecast against actual output.
Shanta plans to mine Ramula as an open pit first, at about 2.4 grams per tonne, while the high-grade underground mine ramps up, feeding a single plant sized at 915,000 tonnes a year. Komen describes the economics as “resilient at modest scale,” with a plant small enough to keep capital cost per ounce low and to “withstand price downturns.”
Officials have valued the deposit at Ksh683 billion (about $5.3 billion). That figure multiplies the resource by the spot gold price, before mining costs and recovery rates.
The harder part is people
Shanta has been privately held since May 2024, when Saturn Resources, a subsidiary of ETG Holdings (Mauritius), completed a takeover valuing it at about £156.1 million ($198 million). The company says its 2026 priorities are closing project finance and advancing resettlement, and its filing budgets Ksh22 billion to Ksh27 billion (about $170 million to $209 million) for construction.
Funding a first mine in Kenya is harder than funding Shanta’s Tanzanian operations, Komen said. He expects a mix of sponsor equity, debt from development finance institutions and possibly a stream or prepayment, in which a buyer pays upfront for future gold.
The engineering worries him less. Construction and commissioning are well understood, he said, and financing structures are being put in place. “The real execution risk lies in securing a social license: community goodwill, political alignment, and government support.” Shanta has proven itself technically in Tanzania, he said; in Kenya, success “depends on strong stakeholder engagement and policy backing.”
Where the gold goes now
The central bank programme is aimed at gold the state cannot see. Recorded output fell to 329.1 kilograms in 2025, from 358.5 kilograms in 2024 and 410 kilograms in 2023, according to KNBS, with most of it coming from the licensed Karebe and Kilimapesa mines. The State Department for Mining’s estimate implies about 3.6 tonnes a year, roughly 11 times the 2025 figure.
The government’s own figures point to a far larger industry. The National Action Plan for Artisanal and Small-Scale Gold Mining, published by the Ministry of Environment and Forestry in 2022, estimates artisanal output at 6.9 tonnes a year across six western counties, almost none of it recorded.
Trade data shows where much of that gold goes. Kenya declared 672 kilograms of gold exports in 2023, while other countries, led by the United Arab Emirates, recorded 9.65 tonnes of gold imported from Kenya, according to an analysis of customs data by the Swiss development organisation SWISSAID. Between 2014 and 2023 the mismatch totalled 51.8 tonnes, including 33.5 tonnes worth about $1.68 billion with the UAE alone. SWISSAID estimates that undeclared gold leaving Kenya exceeds 2 tonnes a year.
Not all of it is Kenyan. Gold smuggled from South Sudan, the Democratic Republic of Congo and Ethiopia is consolidated in Nairobi before being flown out, according to SWISSAID and the Global Initiative Against Transnational Organized Crime. A Kenyan smuggler interviewed by the Global Initiative in 2023 put Congolese gold entering the Kenyan market at 100 to 200 kilograms a month.
“There is a lot of gold being exported out of Kenya through all manner of corners,” Ruto said. The Central Bank of Kenya (Amendment) Act, 2026, signed on July 6, lets the bank buy, hold and refine gold and count it in official reserves. Ruto said three refineries, one in Kakamega and others in Nairobi, are operating or under development.
Whether that gold changes hands officially will depend on rules not yet written. Komen said layering new requirements onto frameworks that are only partly in force “risks unintended consequences: more smuggling, illicit trade, and greater opacity in the gold sector and its supporting industries.” The central bank’s pricing formula will decide whether miners find the official channel worth using.
How much the state takes
The Ministry of Mining lists the gold royalty at 3% of gross value, cut from 5% in July 2024. Royalties are shared 70% to the national government, 20% to the county and 10% to the host community. Miners also pay 1% of output value to host communities, 30% corporate tax and dividend withholding tax, and give the state a 10% free-carried stake, Komen said.
The levies that hurt most are those charged on revenue, “since they apply even when mines are unprofitable,” he said. His rule of thumb: once gross levies pass 5% to 6%, or total government take passes 55% to 60% of pre-tax cash flow, projects under 2 million ounces in countries new to large-scale mining lose out to Tanzania or Ghana. West Kenya, at 1.72 million ounces, sits below that line, and a new refining levy “would cross that threshold quickly at lower gold prices,” Komen said. The government has not said whether the refining mandate will carry fees.
Sharing the ground
The mine will be built where artisanal miners already dig. Shanta says it will acquire land through negotiated agreements under Kenya’s Land Act and the International Finance Corporation’s standard on resettlement. Komen argues for “formal coexistence rather than displacement,” and points to African precedents: a purpose-built resettlement town at Kibali in the Democratic Republic of Congo, livelihood programmes at Ahafo in Ghana, and Ghanaian community mining zones on ground too poor for large operators. Barrick’s North Mara mine in Tanzania, he said, “shows the cost of getting this wrong.”
For West Kenya he recommends fixing a cut-off date and census “before speculative structures go up,” giving artisanal miners formal zones outside the mine plan, offering land for land rather than cash alone, and publishing community development spending. The new policy could help, he said: buying artisanal gold through the central bank “now fits.”
Lessons from the neighbours
The Bank of Tanzania, which requires miners and dealers to sell it 20% of gold earmarked for export, bought about 28 tonnes over 18 months to mid-2026, Governor Emmanuel Tutuba said. In Ghana, the International Monetary Fund said the domestic purchase programme helped rebuild reserves, but 2025 losses on artisanal purchases came to about 17% of the value of the gold the Bank of Ghana sold. Uganda began a three-year pilot in April 2026.
From across the border in Geita, Lerionka Sarisar, operations director and a shareholder at Clover Mining Co. Ltd, said Kenya’s first priority should be mapping its gold resources “openly, transparently, professionally and proactively.” That step “will immediately attract local capital and FDI,” Sarisar said, and show citizens and foreign investors alike that the government is committed to revealing the country’s potential. Sarisar would also make the allocation of mining rights on the cadastre “transparent, above board and well regulated,” and introduce a mid-tier cadastre to bring more medium-sized local investors into the industry.
What to watch
- Central bank pricing: the formula will show whether the bank pays at or below the international price, the variable behind Ghana’s losses.
- The legal instrument: the government has yet to set a start date for the export ban or name the law that will impose it.
- Shanta’s financing: the announcement, expected in 2026, will show how lenders have priced the refining mandate into Kenya’s first large-scale gold mine.