Tanzania has taken another step towards becoming a key supplier of critical minerals after completing compensation payments worth more than Sh16 billion to residents and the Ngwala Village Government to pave the way for the development of the Ngualla Rare Earth Elements (REE) project in Songwe Region.
The landmark exercise saw 192 residents receive more than Sh4 billion in compensation, while the Ngwala Village Government was paid over Sh12 billion, bringing the total compensation package to more than Sh16 billion.
The project is being undertaken by Mamba Minerals, a joint venture between the Government of Tanzania and China's Shenghe Resources, and is expected to operate for 28 years, creating more than 5,000 jobs while positioning Tanzania among Africa's leading producers of rare earth minerals.
Speaking during a ceremony marking the completion of the compensation exercise on Friday, July 3, Deputy Minister for Minerals Dr Steven Kiruswa said the payments demonstrate the government's commitment to ensuring communities affected by strategic investments are compensated fairly and promptly.
He said the exercise fulfils President Samia Suluhu Hassan's directive that citizens who give up land for national development projects should receive timely compensation in accordance with the law.
"The completion of this exercise marks an important milestone, not only for the project but also for the people of Ngwala. It demonstrates that strategic investments can deliver direct benefits to local communities while supporting the country's economic transformation," Dr Kiruswa said.
He urged beneficiaries to channel the funds into productive investments, including housing, businesses, agriculture and education, rather than spending them on short-term consumption.
"More than Sh12 billion has been paid to a single village. These resources should become the foundation for sustainable development that will benefit both the current generation and those to come," he added.
Mamba Minerals Chief Executive Officer Ismail Diwani said the Ngualla project is expected to employ 5,025 Tanzanians throughout its operational life, offering opportunities in mining, engineering, logistics, construction and other supporting industries.
He said the project will also stimulate local economic activity through procurement opportunities, infrastructure development and increased government revenues.
Songwe District Commissioner Fadhili Nkurlu said the government has put in place mechanisms to ensure compensation recipients and their funds remain secure. He also called on financial institutions to continue providing financial literacy programmes to help beneficiaries invest wisely and preserve their wealth.
Songwe Member of Parliament Philipo Mulugo praised the Ministry of Minerals for completing the compensation process, describing the project as a catalyst for economic growth in the region.
He said the investment is expected to generate employment, improve livelihoods and accelerate the development of Songwe through increased business opportunities and supporting infrastructure.
The Ngualla project is regarded as one of Africa's most significant rare earth developments at a time when global demand for critical minerals is rising rapidly due to the transition towards clean energy technologies.
The mine will primarily produce Neodymium and Praseodymium, rare earth elements that are essential in the manufacture of permanent magnets used in electric vehicles, wind turbines, advanced electronics and other high-technology applications.
As countries race to secure reliable supplies of critical minerals, the Ngualla project is expected to strengthen Tanzania's position in the global energy transition while supporting the country's ambitions to increase value creation and investment in the mining sector.
