United Republic of Tanzania

Ministry of Energy & Minerals

ARTISANAL AND SMALL-SCALE MINING (ASM) PILOT PROJECTS IN TANZANIA

Background
Small-scale and artisanal mining which spreads all over Tanzania has been a key rural economic activity in Tanzania for many years. In coastal areas, ASM engage in the production of industrial minerals, namely solar salt and limestone; whereas, the interior part of the country mining operations are centred on gold, diamonds, gemstones, sand, gravels, tin ore, dimension stone and gypsum. Current statistics indicate that small scale mining activities are largely concentrated in gold and gemstone mining areas, and the largest Small Scale Mining (SSM) centres are located in Lake Victoria Goldelds. In the case of gemstone mining, the largest centres are located in the eastern and northern part of the country. Recently, there has been a notable increased in ASM interest in base metals in the central part of the country. Small scale mining was the major producer of minerals in Tanzania for the period between 1987 and 1997. In supporting the development and transformation of small-scale mining in Tanzania, the Sustainable Management of Mineral Resources Project (SMMRP) will provide technical assistance to strengthen provision of extension service to ASM. Extension service and training will be instrumental in enabling the ASM to participate eectively in project implementation that is expected to increase their awareness and eventually lead to better performance and productivity. The technical assistance under SMMRP will entail, inter alia, the provision of small grants to small-scale miners. However, the grants facility will not cover for the following activities; Normal operating costs of projects, except for a specied period of time under certain circumstances (e.g. fuel for an agreed-upon period of one month if mechanized equipment is introduced). If equipment and technology purchases are made under the project grant, responsibility for maintenance and operation is conferred to the successful applicant. Labor costs of beneciaries (e.g. salaries) will not be included in the grants and should be provided as a form of cost sharing; Re-sale to a third party of any equipment and technology purchased under the project grant Projects that clearly and negatively impact the environment (such as mercury use in an existing operation under the application, draining of wastes from mining operations into public or private water sources) Projects that lead to resettlement of any other group or individuals if registering a mine title or expanding an operation is proposed under the grant application Direct requests for credit or loans. Maximum Financial Support Given the intensive support needed to eectively implement the grant projects, it is strongly recommended that no more than 10 applicants be targeted to receive grants under Phase 1 of the SGP. That is grants may be considered to a maximum of USD 50,000 per applicant. Each grant amount shall include costs of main eligible activity (ies) as well as those associated with conditions of the grants (e.g. environmental, administrative and training costs). Cost Sharing Any equipment that is provided is far less likely to be properly maintained or managed if it is given simply as a gift. Some form of cost-sharing is typically needed to build ownership and commitment to the SGP grant. A percentage of cost-sharing required of applicants also demonstrates some organization capacity (i.e. to jointly save funds via group savings). Cost-sharing can nevertheless be included in the form of in-kind contributions. This, at a minimum, should include: human resources/labour to construct basic works (e.g. drainage trenches, sedimentation/water collection ponds, simple structures) and time spent during training in use of new equipment, tools or other grant-related training (e.g. how to construct a sedimentation pond). Duration Once approved, small grants projects should be completed within a maximum of 12 months. Final project reports from beneciaries should follow no later than 3 months after the 12 month contract completion. Eligible Grantees and Geographic Scope Eligible beneciaries include small scale miners (men and women) and their operations (including value-addition), and women in the service provision industry around mines. Eligibility criteria of applicants are proposed to include: If a small-scale mining entity: o Proven experience of at least 5 years in the small-scale mining sector of Tanzania; o If applying as a mining entity or operation to upgrade technology or introduce new processing equipment on site, presentation of valid mineral rights, business licenses, PML, processing license, as concerns the site(s) where upgrades are proposed. If a womans subsidiary business (including gemstone value-addition): o Appropriate registration with local council/government o If concerning subsidiary businesses that supply mine sites, business activities must be in the mining catchment area (no more than 5kms from the site) identied by the application o If concerning value-addition, a chain of custody paper trail system that attests to the legal sourcing of the gemstones (i.e. from registered sites) o Proven experience of at least 5 years in service provision at mine sites, or in development of value-addition activities Taking into consideration the concentration of small-scale mining activities across Tanzania, roughly 40% of the successful applicants will be from the Lake Victoria region with the remaining 60% from other regions of the country. In addition at least 30% of the applications must be with women-run or women-led businesses. In view of the above, TIB a government lending institution, has been selected by the MEM to manage the solicitation of proposals from prospective applicants in the identied regions, the gathering of all applications and submission to the SGP Task Force. Following the selection of applicants by the SGP Task Force, TIB will be responsible for disbursement of funds, eld monitoring in conjunction with the zonal oces, and nancial monitoring. In addition, TIB will be responsible for nal reporting and audit as set out in the terms of agreement it signs with the MEM. Submission All proposals shall be submitted to the nearest TIB branch or zonal oce available in Mbeya, Mwanza, Arusha and Dar es Salaam or to the nearest zonal or resident mines oce addressed as follows:Managing Director, TIB Development Bank Ltd P. O. Box 9373, DAR ES SALAAM

CALL FOR GRANT PROPOSALS

The Pro le of SMMRP

The SMMRP is nanced by an International Development Assistance (IDA) Credit and counterpart funds from the Government of United Republic of Tanzania and its implementation commenced in the nancial year 2009/2010. The development objective of the proposed Project is to improve the socio-economic impacts of mining for Tanzania and specically the indigenous population and improve the Governments capacity to manage the mineral sector and enhance local as well as foreign investments. The Project has four primary components, namely: (i) Improving the benets of the mineral sector for Tanzania; (ii) Strengthening governance and transparency in mining; (iii) Stimulating mineral sector investment; and (iv) Project coordination and management TIB Development Bank Limited (TIB) has entered into a Trust Agency agreement with the Ministry of Energy and Minerals (MEM) to administer the provision of small grants to small-scale miners from the Small Grants Program (SGP) on behalf of the Government. The grants facility is for nancing eligible small scale miners (men and women) and their operations (including value-addition), and women in the service provision industry around mines to nance the following eligible activities: Responsiveness to identi ed needs. SGP projects should address a clear need or priority of ASM organizations with explicit consideration of what may be the same or dierent needs of women and men. Commitment and direct involvement of SGP applicants in implementation (including in dedicating human resources for construction of civil works, sensitizing and involving group members and managing activities on the ground) will be needed and should be coordinated with organizational strengthening activities of the SMMRP, if possible. Training to ensure sustained and equitable bene ts from the SGP. Funds should be allocated to training in operation and maintenance in proper, environmentally responsible and safe use of any equipment, tools or supplies introduced. This training should give sucient attention to how operating and maintenance costs of the equipment and tools will be accumulated from prots and/or group-member contributions and managed by the group. Separate training of women and men may be needed in order to ensure women are suciently empowered to manage any technology introduced and share in its benets. This may extend beyond technical training to additional organizational strengthening related to management of the new technology. For example, to deal with changes in the organization of labour at the site arising from the technology, savings to ensure operating and maintenance costs are met. Mitigation of environmental and social impacts. A part of each small grant will also need to be allocated to mitigate any environmental and social impacts of SGP Projects. Environmental examples may include: construction of basic sedimentation ponds to prevent siltation of rivers (and support recycling of water); small tree planting activities (to oset degradation of ASM areas); or requirements to backll abandoned pits. Applicants should take on much of the responsibility for undertaking such works (and receive sucient guidance/training to do so) as a means of cost-sharing and to increase ownership of the SGP projects. Any health and safety repercussions (e.g. risks with increased mining rate or use of semi-mechanized equipment) must also be considered in the scope of activities. Administrative costs. Successful applicants may have some costs associated with setting up bank accounts, transport, photocopying or printing of documents and will be accountable for such expenditures throughout the duration of the SGP. Use of simple, measurable indicators to evaluate SGP-supported projects. All SGPsupported projects must have a direct positive eect on intended beneciaries in accordance with SGP objectives. Simple indicators can be included within the application process and successful applicants should be trained to measure and report on these indicators in collaboration with the ASM focal points identied in the relevant zonal oces.

TIB Development Bank Ltd, P. O. BOX 9373, Dar es Salaam, Tanzania. T: +255 22 2411101-9 F: +255 22 2411095. E: md@tib.co.tz

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