The World Bank Report No: ISR9424 Implementation Status & Results Tanzania Sustainable Management of Mineral Resources (P096302) Public Disclosure Copy Operation Name: Sustainable Management of Mineral Resources (P096302) Project Stage: Implementation Seq.No: 7 Status: ARCHIVED Archive Date: 26-Feb-2013 Country: Tanzania Approval FY: 2009 Product Line: IBRD/IDA Region: AFRICA Lending Instrument: Technical Assistance Loan Implementing Agency(ies): Key Dates Board Approval Date 09-Jun-2009 Original Closing Date 30-Jun-2014 Planned Mid Term Review Date 15-Oct-2012 Last Archived ISR Date 24-Jul-2012 Effectiveness Date 22-Sep-2009 Revised Closing Date 30-Jun-2014 Actual Mid Term Review Date 12-Nov-2012 Project Development Objectives Project Development Objective (from Project Appraisal Document) To strengthen the Governments capacity to manage the mineral sector to improve the socioeconomic impacts of large and small-scale mining for Tanzania and Tanzanians and enhance private local and foreign investment. Has the Project Development Objective been changed since Board Approval of the Project? Yes No Component(s) Component Name Component Cost A. Improving the Benefits of the Mineral Sector for Tanzania: Artisanal and Small-scale Mining, Local 15.90 Economic Development, and Ski B. Strengthening Governance and Transparency in MIning 8.70 C. Stimulating Mineral Sector Investment 25.00 D. Project Coordination and Management 2.50 Public Disclosure Copy Overall Ratings Previous Rating Current Rating Progress towards achievement of PDO Moderately Satisfactory Moderately Satisfactory Overall Implementation Progress (IP) Moderately Unsatisfactory Moderately Unsatisfactory Overall Risk Rating Substantial Implementation Status Overview The project is well behind schedule but is achieving some positive results. Policy changes, improved capacity, increased gold prices and investors interest have resulted in significant increases in license rents (up by 164% to TSh7 billion) and royalties (up 129% to TSh 77 billion) from 2009 - 2011. Processing of mineral licenses has significantly improved with the backlog being reduced by 60% and processing of prospecting licenses at an average of 9 months and primary mining licenses at 2 months compared to 18 months for prospecting Page 1 of 6 The World Bank Report No: ISR9424 licenses and primary mining licenses at 23 months in April. The number of mine audits has increased by 325%. Digitization of geological maps is ahead of schedule with 58% of maps now digitized and Tanzania's Frasier Institute mineral potential ranking increased from 35th of 72 in 2010 to 25th of 93 in 2012. The airborne geological survey is progressing well with 37% of line kilometers flown for magnetic and radiometric, 57% for gravity and 24% for electromagnetic. The survey has already identified previously unknown geological structures including potential new gold and Tanzanite mineralization. Public Disclosure Copy Tanzania achieved EITI compliance in December 2012. The third EITI reconciliation report, which will cover company and government revenues from July 1, 2010 to June 30, 2011 and is expected in March/April 2013. The second EITI Report disclosed payments from 24 oil, gas and mining companies to government for the period from July 1st, 2009 to June 30th, 2010 and reported government received US$305,358,000, up from US$ 99,457,000 collected from eleven extractive companies from July 1, 2008 to June 30, 2009. The second report also showed a net discrepancy of US$3,643,898 (1%) between company payments and government revenues. Following a further reconciliation, documented in an addendum report, the discrepancy now stands at US$524, 721 (0.17%). Locations Country First Administrative Division Location Planned Actual Tanzania Mara Region Tarime District Tanzania Not Entered United Republic of Tanzania Tanzania Tanga Region Tanga Region Tanzania Kilimanjaro Region Same District Tanzania Kilimanjaro Region Rombo District Tanzania Rukwa Region Mpanda District Tanzania Not Entered Morogoro Urban Tanzania Mbeya Region Mbozi District Tanzania Mbeya Region Mbeya Region Tanzania Singida Region Manyoni District Tanzania Lindi Region Mandawa Tanzania Iringa Region Makete District Public Disclosure Copy Tanzania Kilimanjaro Region Kilimanjaro Region Tanzania Kigoma Region Kasulu District Tanzania Shinyanga Region Kahama District Tanzania Kagera Region Kabanga Tanzania Singida Region Itigi Tanzania Mwanza Region Geita District Page 2 of 6 The World Bank Report No: ISR9424 Country First Administrative Division Location Planned Actual Tanzania Mbeya Region Chunya District Public Disclosure Copy Tanzania Shinyanga Region Bukombe Tanzania Kagera Region Bukoba District Tanzania Kagera Region Biharamulo District Tanzania Arusha Region Arusha Tanzania Kagera Region Kagera Tanzania Mtwara Region Mtwara Region Tanzania Ruvuma Region Mbinga District Results Project Development Objective Indicators Indicator Name Core Unit of Measure Baseline Current End Target Percentage increase of household income Percentage Value 0.00 97.00 10.00 levels in selected ASM communities Date 31-May-2012 30-Jun-2014 Comments 2009-baseline US$4/day 97% as identified by the ASM study. Main factor at this point is the increase in the price of gold and cannot be attributed to theSMMRP. However attribution can be tested in future through production data to show improved production and efficiency, and also through SMMRP activities on Public Disclosure Copy market access and pricing. Percent of citizens in participating communities Percentage Value 12.00 who consider that their views have been taken Date 31-Dec-2010 into account in the local economic development Comments Based on field survey under Will be retested at project strategic planning process (perception survey) the Benefits Study close. Time to process mineral rights (exploration Months Value 18.00 4.00 2.00 licenses). Date 09-Jun-2009 31-Oct-2012 30-Jun-2014 Comments 15 Months was a rough 4 months for PLs; 2 months for PMLs; SMMRP has Page 3 of 6 The World Bank Report No: ISR9424 estimate at appraisal and was supported reduction in underestimated. backlog and improvements to the mining cadastre system. Annual publication of mining sector revenue Yes/No Value No Yes Yes Public Disclosure Copy Date 30-Jun-2009 31-Oct-2012 Comments Second EITI Report and addendum published. Third report in progress. Improvement in Tanzania's ranking as a mining Text Value 48/71 for policy ranking & 63/93 for policy ranking & Increase of 2-3 points/palces investment destination as evidenced by 22/71 for mineral potential 25/93 for mineral potential for or more over baseline in one independent investor survey (Fraser Institute). 2011/12 or both indicators. Date 30-Jun-2009 31-Oct-2012 30-Jun-2014 Comments Over the past year no changes in the policy attractiveness ranking and mineral potential. The geological attractiveness ranking is expected to improve further after geological component results. SMMRP has been supporting promotion of Tanzania's geology an international mining events. Percentage increase in mining revenue Percentage Value 0.00 140.00 5.00 Date 30-Jun-2009 31-Oct-2012 30-Jun-2014 Comments First EITI Report showed Increases in license rents (up consolidated revenue of by 164% to TSh7 billion) and $100million. royalties (up 129% to TSh 77 billion) from 2009 - 2011. Intermediate Results Indicators Public Disclosure Copy Indicator Name Core Unit of Measure Baseline Current End Target Improved performance in selected ASM Text Value 4.7 tons of gold TBD coummunities as evidenced by increased Date 09-Jun-2009 31-May-2012 30-Jun-2014 production (quantity and USD). Comments Baseline. Yearly targets to be As identified by the ASM Targets to be developed in developed in tandem with baseline study. tandem with ASM baseline ASM baseline survey (see survey PDO indicator 1). Annual national production data required. Page 4 of 6 The World Bank Report No: ISR9424 Percentage of pending mineral rights Percentage Value 0.00 60.00 80.00 applications reduced. Date 01-Mar-2009 31-Oct-2012 30-Jun-2014 Comments Pending/backlog of Outstanding prospecting 80% reduction expected from Public Disclosure Copy applications from Oct 2007- license applications have baseline number March 2009. 10000 been further reduced to 60% applications in total. reduction from baseline value. Percentage of country covered by geophysical Percentage Value 3.00 7.50 14.00 airborne surveys at 1:100,000 scale. Date 09-Jun-2009 31-Oct-2012 30-Jun-2014 Comments 3% of the country coverd by Airborne geological survey is airborne geophysics progressing well with 37% of planned line kilometers flown for magnetic and radiometric, 57% for gravity and 24% for electromagnetic Project monitoring and evaluation. Text Value Project start Successful M&E Date 09-Jun-2009 31-May-2012 30-Jun-2014 Comments Project M&E system, building M&E consultancy price tripled Regular project reporting will on results framework, to be the projected costs. be used to track project developed in Year 1 Rebidding is under MEM results. review. Revised mineral law and regulations Text Value Revisions ongoing Revisions and dissemination disseminated completed. Date 09-Jun-2009 31-May-2012 30-Jun-2014 Comments 3000 copies of revised mineral policy disseminated. Formulation of legal and regulatory framework on value addition ongoing. Number of mines inspections (including Text Value 1,000 per year Regular and systemized environmental) and remedial actions; number inspections and audits of audits. Public Disclosure Copy Date 09-Jun-2009 31-May-2012 Comments Large, medium and small scale mines were inspected on HSE. Data on Financial Performance (as of 27-Dec-2012) Financial Agreement(s) Key Dates Project Ln/Cr/Tf Status Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date P096302 IDA-45840 Effective 09-Jun-2009 22-Jul-2009 22-Sep-2009 30-Jun-2014 30-Jun-2014 Page 5 of 6 The World Bank Report No: ISR9424 Disbursements (in Millions) Project Ln/Cr/Tf Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P096302 IDA-45840 Effective XDR 33.50 33.50 0.00 10.80 22.70 32.00 Public Disclosure Copy Disbursement Graph Key Decisions Regarding Implementation The mid term review confirmed that the project development object objectives remain valid. The Government and two large mining companies (Africa Barrick and Anglogold Ashanti) have agreed to create a multi-stakeholder initiative on artisanal and small scale mining with the Bank providing a facilitating role and providing support through SMMPR. Restructuring History Public Disclosure Copy There has been no restructuring to date. Related Projects There are no related projects. Page 6 of 6