British company discovers Sh683bn gold deposits in Kakamega

The EIA estimates a capital investment of between US$170 million and US$208 million (Sh22–27 billion) and annual operating costs of about US$19 million (Sh2.5 billion).
The company expects to pay royalties of about US$4.3–4.7 million (Sh560–610 million) to the government every year, plus US$1.5 million (Sh195 million) in the Mineral Development Levy.

A British mining company, Shanta Gold Limited, has reported one of the country’s largest gold deposits yet, an estimated Sh683 billion worth of the precious metal in Kakamega County.

The company estimates it will need around 337 acres of land, primarily privately owned plots, which will lead to the displacement of roughly 800 households.

To address this, it has earmarked six possible resettlement locations spanning about 1,932 acres, giving affected families the option of monetary compensation or relocation within the same region.

According to an Environmental Impact Assessment (EIA) report submitted to the National Environment Management Authority (NEMA), Shanta Gold’s Kenyan subsidiary confirmed 1.27 million ounces of gold at its Isulu-Bushiangala underground mining project, located in Kakamega South Sub-county.

The report, titled Shanta Gold West Kenya Feasibility Study: Isulu-Bushiangala Underground Mining Project, was prepared by Kurrent Technologies Limited in partnership with South Africa’s Digby Wells Environmental.

It outlines plans to establish a large-scale underground mine in Musoli and Isulu locations, about 55 kilometres northwest of Kisumu.

“The Isulu and Bushiangala resources contain 1,270,380 ounces grading an average of 11.43 grams per tonne of gold,” the report states, describing the project as “a net benefit to the area and Kenya as a whole.”

At current market prices, the deposit is valued at about Sh683 billion, making it one of the country’s most valuable mineral discoveries.

Shanta Gold Kenya Limited (SGKL), incorporated locally in 2010, is a wholly owned subsidiary of the London-listed company and is seeking NEMA's approval to proceed with the underground mine and processing plant under its existing prospecting licence.

The mine will use Long Hole Open Stoping (LHOS), a mechanised underground method that allows selective extraction of ore with minimal surface disturbance.

According to the company, the mined-out voids will be filled with cemented aggregate, reducing the risk of land subsidence and degradation.

Key infrastructure will include a 1,500-tonne-per-day processing plant, tailings storage facility, waste rock dumps, administrative buildings and a 12-megawatt power plant.

“Although the project will result in impacts of significance, these will be minimised through mitigation measures,” the EIA notes.

“The project is economically feasible, technically viable and socially desirable.”

SGKL General Manager Jiten Divecha, who signed off the report, said the company’s focus is to develop “a world-class underground operation that meets global safety and sustainability standards.”

The mine’s lifespan is projected at eight years, though further exploration could extend operations.

The EIA estimates a capital investment of between US$170 million and US$208 million (Sh22–27 billion) and annual operating costs of about US$19 million (Sh2.5 billion).

The company expects to pay royalties of about US$4.3–4.7 million (Sh560–610 million) to the government every year, plus US$1.5 million (Sh195 million) in the Mineral Development Levy.

Under the Mining (Community Development Agreement) Regulations, Shanta Gold will also share 1% of the value of gold produced directly with host communities.

Kakamega County, known for agriculture and artisanal mining, is expected to benefit from new jobs and infrastructure once operations begin.

The EIA projects hundreds of direct and indirect employment opportunities, particularly during construction and production.

Under Kenya’s Mining Act, three per cent of gross gold sales will go to the national government as royalties. Of that, 20 per cent will be remitted to Kakamega County and 10 per cent to local communities through development projects.

County officials have previously expressed optimism that the mine will “unlock the economic potential of western Kenya,” provided it is managed responsibly.

Despite its promise, the project has raised concerns over land acquisition, possible displacement and environmental risks.

The report notes that land will be acquired from both private and public owners in Musoli and Isulu. Some residents fear forced evictions, unfair compensation, and loss of ancestral land.

“There is apprehension and fear of forceful evictions from ancestral lands,” the EIA records. “Stakeholders emphasised the importance of transparent communication and inclusive public participation.”

Shanta Gold says land acquisition will follow a voluntary, negotiated process under Kenya’s Land Act (2012) and the International Finance Corporation’s Performance Standards (PS5).

Additionally, a Resettlement Action Plan will guide compensation and livelihood restoration.

Environmental issues dominated consultations, with questions on water use, dust control and chemical safety.

The EIA identifies potential risks to the Yala and Isiukhu river catchments, which drain into Lake Victoria. Baseline tests already showed high nitrate and manganese levels from agricultural runoff.

“Continuous monitoring will be conducted on streams and rivers both upstream and downstream,” the consultants recommend, adding that stormwater management and controlled blasting will be used to prevent contamination and vibration damage.

It was decided that cyanide, to be used in processing, will be handled under international safety standards.

The study highlights the area’s ecological and cultural sensitivity, given its proximity to the Kakamega Forest, one of East Africa’s last tropical rainforests.

Archaeological surveys identified ceramic artefacts and sacred Mugumo (fig) trees, which will be preserved or relocated respectfully in consultation with elders.

The ecosystem is classified as “critical or endangered,” requiring strict biodiversity protection. Shanta Gold has been urged to limit vegetation clearance, rehabilitate mined land progressively, and involve communities in conservation projects.

A Human Rights Impact Assessment, based on UN guidelines, identified risks involving artisanal miners, vulnerable groups, and worker safety.

The report proposes community education, gender desks in health facilities, and training for youth and women to support fair participation in mining-related jobs.

Experts note that while the Kakamega gold discovery is a major economic boost, its sustainability will depend on environmental vigilance and transparent governance.

“Provided that all environmental safeguards are adhered to, the project should continue to benefit both the local communities and the country,” the EIA concludes.

NEMA is expected to make a final decision on the project’s approval after reviewing the report. If cleared, Shanta Gold will move into mine development, potentially positioning Kakamega as Kenya’s new frontier in large-scale gold mining.