AFRICAN DEVELOPMENT FUND

UGANDA

MINERAL RESOURCES MANAGEMENT AND CAPACITY BUILDING PROJECT

PROJECT COMPLETION REPORT (PCR)

ONEC

May 2013

1

COMPLETION REPORT of PROJECT A. PROJECT DATA AND KEY DATES

I. BASIC INFORMATION Project Number Project Name Country (ies)

Grant No. 100155003467 Mineral Resources Management and Capacity Building Project (MRMCB)

UGANDA

ID Number of all Lending Instrument(s) Department Environmental Classification

P-UG-BA0-001 ONEC 2

Original Commitment Amount

Amount Cancelled Amount Disbursed Percent Disbursed

UA 5.35 Million UA 0.54 Million UA 4.81 Million 100,0%

Recipient of Grant

REPUBLIC OF UGANDA

Executing Agency(ies) [List the main Ministries, Project Implementation Units, Agencies and civil society organizations responsible for implementing project activities.]

MINISTRY OF ENERGY AND MINERAL DEVELOPMENT (MEMD); DEPARTMENT OF GEOLOGICAL SURVEY AND MINES (DGSM); and PROJECT COORDINATION UNIT (PCU).

Co-financers and other External Partners [List all other sources and amounts of financing, technical assistance or other resources used in this project]

IDA (UA 17.37 Million); NORDIC DEVELOPMENT FUND - NDF (UA 4.86 Million) and GOU (UA 2.08) Million.

II. KEY DATES Project Concept Note Cleared by Ops. Com. Appraisal Report Cleared Board Approval

N/A juin-04 29-sept-04

Restructuring(s)

Original Date MM/DD/YY

Actual Date MM/DD/YY

Difference in months (auto-calculated)

EFFECTIVENESS 04/01/05 03/17/05

-0,5

MID-TERM REVIEW 06/15/07 01/22/08

7,4

CLOSING

12/31/10

For ongoing projects enter date of 98% disb. rate 17,2

05/31/12

III. RATINGS SUMMARY All summary ratings are auto-generated by the computer from the relevant section in the PCR. CRITERIA SUB-CRITERIA RATING

PROJECT OUTCOME

Achievement of Outputs 4

Achievement of Outcomes 4

Timeliness 2

OVERALL PROJECT OUTCOME 3,3

2

BANK PERFORMANCE

Design and Readiness 3

Supervision 3

OVERALL BANK PERFORMANCE 3,0

BORROWER PERFORMANCE

Design and Readiness 3

Implementation 3

OVERALL BORROWER PERFORMANCE 3,0

IV. RESPONSIBLE BANK STAFF

POSITIONS AT APPROVAL AT COMPLETION

Regional Director B. SIDIBE G. NEGATU

Sector Director K. BEDOUMRA H. CHEIKHROUHOU

Sector Manager N. LOBE E. NEGASH

Task Manager B. KAYONGO D. LEKOETJE

PCR Team Leader D. LEKOETJE

PCR Team Members D. ISOOBA; B. KAYONGO

B. PROJECT CONTEXT Summarize the rationale for Bank assistance. State: -what development challenge the project addresses, -the Borrower's overall strategy for addressing it, -Bank activities in this country (ies) and sector over the past year and how they performed, and -ongoing Bank and other externally financed activities that complement, overlap with or relate to this project. Please cite relevant sources. Comment on the strength and coherence of the rationale. [250 words maximum. Any additional narrative about the project's origins and history, if needed, must be placed in Annex 6: Project Narrative]

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Development Challenge the Project addresses: The Government faces following challenges: (i) Activities of the artisanal and small-scale miners (ASMs) that cause environmental degradation, with dire-living conditions by local communities, and growing social strain between miners and established communities; (ii) Large-scale mining that results in evolution of hostile relationship with stakeholders, with corporate fragility in situations of environmental accidents; and (iii) Disputes for sharing benefits of mining activities between GOU, investors and local communities. The MRMCB aims at strengthening institutional and administrative capacities that would help to minimize these negative consequences. Recipient's overall strategy for addressing it: GOU’s strategy is to improve governance and environmentally sustainable and inclusive private sector growth. The MRMCB is contributing

to institutional building, human resources development, and facilitating Ugandan participation in the sector.

Bank Activities in Uganda and Sector in past year: AfDB support to Uganda comprises 22 ongoing operations amounting to USD 1.24 billion: USD 302 million (24%) for road infrastructure, USD 295 million (24%) for agriculture, USD 234 million (19%) for energy sector, USD 225 million (18%) for social sector infrastructure, USD 136 million (11%) towards water and sanitation, and USD 50 million (4%) for other sectors.

Ongoing Bank and Other externally financed activities that complement, overlap with or relate to this project: The project was co-financed by three development partners, ADF (UA 5.35 million), IDA (USD 29.7 million), Nordic Development Fund (EUR 6 million,) and GOU (UA 2.08 milllion). This amounted to 18%, 59%, 16% and 7% of the project cost respectively.

WORD COUNT 249

C. PROJECT OBJECTIVES AND LOGICAL FRAMEWORK 1. State the Project Development Objective(s) (as set out in the appraisal report)

To encourage expansion of private investment in the mineral sector in a socially and environmentally sound manner. The project entails: (i) Building institutional capacity and regulatory reform; (ii) improving the country’s geological information system; (iii) establishing a preventive environment protection for mining; and (iv) improving lives of local communities and activities that would lead to the sustainability of the small scale and artisanal mining.

2. Describe the major project components and indicate how each will contribute to achieving the Project Development Objective(s).

The MRMCB comprises 4 major components with the 5th component for Project Management: for managing mineral resources; (i) Strengthening of Governance in Minerals Sector Management, whose objective is to improve transparency and governance for managing mineral resources; it aims at setting-up an adequate institutional framework for the management of mineral resources including strengthening the policy making, regulatory and sector management capabilities, and improving the legal framework. The overall outcome of available and reliable information will be increased transparency that will help to attract private investors in the mineral sector. (ii) Community Development and Mineral Resources, which involves collaboration with regional and community authorities to facilitate the development of information and approaches to integrate natural resources management with the local planning process, including environmental aspects and improvement of delivery of social services and infrastructure to the local communities as well as improvement of artisanal and small-scale mining; the component will assist communities in managing their mineral resources as well as related resource flows they are expected to generate. This component is expected to improve the quality of operations of the artisan and small scale miners (ASMs), in terms of environment and social impact, increased revenues and better use of revenues (iii) Establishment of Environmental/Social Systems, which involves developing within the Department of Geological Survey and Mines (DGSM) an environmental and social unit for environmental protection, preventive and monitoring for mineral activities, as well as for social monitoring and safeguarding for mining areas, and the development of a computer based system and databases to assist the environmental administration of the sector; the component’s objective is to establish an environmental and social management framework for the minerals sector, with emphasis on using decentralised approaches and procedures. The overall outcome will be improved social and environment management in the mineral sector. (iv) Geo-information and Development, which entails completing the coverage of geological maps and acquisition of airborne geophysical data as well as to facilitate access to the information through the computerised Minerals Information System (MIS); the expected outcome of this component is to provide basic and reliable geological information necessary to facilitate the promotion of private investments in the mining sector and to support the planning of the socio-economic development of the country.

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3. Provide a brief assessment (up to two sentences) of the project objectives along the following 3 dimensions. Insert a working score, using the scoring scale provided in Appendix 1.

PROJECT OBJECTIVES DIMENSIONS ASSESSMENT WORKING

SCORE

RELEVANT

a) Relevant to the country's development priorities

The objective is highly relevant to Uganda's development objectives. The project supported the GOU's priority areas which are rural poverty reduction, environmental protection, support for good governance, private sector development and human resources development.

4

ACHIEVABLE

b) Objectives could in principle be achieved with the project inputs and in the expected timeframe

In most cases, the project has achieved solid results in its objectives within expected timeframe. For instance, information from airborne survey has increased license fees and royalties by 738% from the baseline; increased exploration and development expenditure, licenses issued to ASM. So far 39 companies have acquired the released raw data. However, lab benefits will be achieved from June 2012 due to delay in installing the equipment that were installed in May 2012.

3

CONSISTENT

c) Consistent with the Bank's country or regional strategy

The project objectives were in conformity with the Bank's country strategy paper (CSP) for Uganda (2002/2004). The priority areas set in the CSP for ADF IX non-lending resource allocation for Uganda were: (i) capacity building; (ii) environmental protection and management; (iii) support for good governance; and (iv) mineral institutional development in the context of private-public partnerships.

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d) Consistent with the Bank's corporate priorities

The MRMCB is in conformity with the Vision of the Bank Group which revolves around poverty eradication, promoting good governance, private sector development and support for human capital development. The MRMCB aims at promoting private investment in the mineral sector, in rural areas. The project is improving governance and transparency in the management of mineral resources. It is also addressing the issues of environment, capacity building, local communities, and mining rights, all of which aim at reducing poverty in rural areas.

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4. Summarize the log. frame. If a log. frame does not exist, complete the table below, indicating the overall project development objective, the major components of the project, the major activities of each component and their expected outputs, outcomes, and indicators for measuring the achievement of outcomes. Add additional rows for components, activities, outputs or outcomes if needed.

COMPONENTS ACTIVITIES OUTPUTS EXPECTED OUTCOMES INDICATORS TO BE

MEASURED

A - Strengthening of Governance in Minerals Sector Management

A1 - Reviewing and enhancing the legal and regulatory mineral framework

Modern and transparent legal and regulatory framework issued.

Increase in transparency and attract potential investors in the mineral exploration and mine development and facilitate small-scale mining.

Impact of the new regulatory framework on private sector investments in mining sector, security of investments and country risk rating.

A2.1 - Upgrading the mineral service facilities (modernising office buildings at DGSM headquarters).

New and refurbished office and rock storage buildings at DGSM headquarters.

(i) Staff motivation by new office facilities; (ii) Quality services improved at DGSM resulting from improved motivation.

DGSM's capability of timely, reliably, and transparent administrative services delivery to the sector; and retention of staff and staff turnover. Compared to the past.

A2.2 - Restoration of a modern laboratory

Modern laboratories with new equipment by end September 2012.

Mineral samples to be analysed at the DGSM, and income to be generated from lab activities from October 2012.

Number of samples brought to the lab for analysis and income generated from the new labs.

5

A3 - Establishing mining cadastre and registry system.

An operational cadastral and information systems and geological mapping coverage.

Mining Cadastre and Registry system will provide information on precise location of mining rights, status, fees and payments, which are based on transparency. It will be useful for issuing mineral licenses based on first come first served.

Zero complaint. A complaint book is available.

A4 - Developing an Intranet and Internet network.

An Intranet and Internet network system in place

The information required by the investors is available on the internet website and to be updated regularly. The intranet would help to share information within DGSM.

Available information on the Internet website and how frequent the website is updated. How frequent the information on the Intranet is updated and used by the staff within DGSM.

A6 - Strengthening of Mineral Associations.

Increase in number of organised ASMs.

The ASM associations work together to improve the quality and quantity of their mining activities. The associations are used as collateral to obtain loans from banks.

Number of ASMs that are legalised, number of ASMs that are aware of marketing, environment and social impacts of their operations and number of ASMs that approach banks for financial assistance.

B - Community Development and Mineral Resources

B1 - Mineral Resources Management improvement by Communities.

Enhanced ASMs management capacity and increased awareness of local communities in areas related to mining e.g. revenue collection, development plans for use of mineral resources, incorporating health plans into existing program, i.e. HIV/AIDS prevention.

The sub-component is expected to improve value addition, and use of mineral revenues, increase knowledge of: market prices, using small scale technologies, and awareness of social, environment, gender, safety standards, and health issues.

ASM records, including bookkeeping, minutes of meetings.

B3 - Communities and artisanal and small-scale mining baseline study.

Data base on ASMs activities in the country developed.

Availability of information on ASMs would help to improve the monitoring of mining activities and ensure compliance with mining standards

Availability of handbooks to ASM groups and administrative officers in the mining districts.

B4 - Support ASMs to improve local economic development through increased production and diversification.

Increase ASMs production capabilities through improved level of expertise, increased capacity, purchase of new equipment, training and new business development, including diversifications.

ASMs' income from mining and other activities is expected to increase significantly over time.

Recorded income generated.

C - Establishment of Environmental and Social Management Capacity

C1 - Baseline studies and development of environment regulations for mining.

Database for environmental and Social Management and Information System (ESMIS) completed.

Database used to prepare a modern and computerised ESMIS.

Available ESMIS

C2 - Institutional set-up and capacity building for social and environment

Social and Environment Unit (SEU) set up including staffing and training.

The SEU is to review environment impact assessments (EIAs) and

An operational SEU with qualified staff (environmental and social specialists)

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management in the mining sector.

environment audits. It will also be a source of information for the National Environment Management Authority (NEMA) in the mining sector.

structured within DGSM/MEMD.

C3 - Development of environmental and social management system

A computerised Environmental and Social Management Information System (ESMIS) to be put in place at DGSM

The ESMIS is to handle policies, guidelines, and monitoring standards related to environment in mining.

A user friendly ESMIS in place and being used by DGSM staff.

D - Geo-information and Development

D1 - Airborne Geophysical Survey - undertaking regional airborne geophysical coverage of the country, covering 7 blocks; and processing and management of data.

85% coverage of high resolution survey.

(i) Increase in exploration licenses issued i; (ii) Increase in issuance of licenses to ASMs from 100 licenses before the project to a target of 300 licenses by 2011; (iii) increased cumulative mineral exploration and development expenditure to a target of US$ 30 million; (iv) increased license fees and royalties; (v) Investors purchase data from DGSM.

85% of high resolution survey up from 1% in 2004

D2 - Mapping and Mineral Resources Assessment - update and improvement of existing coverage of geological maps, compiling existing geo-chemical survey data, sample analysis

Geophysics maps. The maps are used (i) in mineral exploration by investors; and (ii) others (infrastructure planning, engineering geological studies, agriculture, land use, water resources and environmental .management

Revised existing geophysics maps and new maps available at DGSM.

D3 - Establishing a modern and computerised Geological and Minerals Information system (GMIS) to store, compile and catalogue data and modernize DGSM's documentation centre.

A modern and computerised minerals information system and improved documentation centre at DGSM.

The computerised geological information data is available to investors at a reduced time.

DGSM Website

D4 - Support for Seismological Network

Seismological vaults equipped with modern technology..

The seismological equipment would capture earthquakes. The data would be transmitted automatically to the National Data Centre in Entebbe.

Readings at National Data Centre Entebbe.

D5 - Rehabilitation of the Geological Storage Facilities and restocking the rock sample storage and display as well as training.

Storage buildings at DGSM headquarter rehabilitated and equipment installation, training on job completed.

The storage facilities would be valuable for demonstration of the economic mineral potential and as reference for geological investigations. It will increase public awareness and promote private sector participation in the mineral sector.

Reinstated geological storage facilities at DGSM for

5. For each dimension of the log. frame, provide a brief assessment (up to two sentences) of the extent to which the log. frame achieved the following. Insert a working score, using the scoring scale provided in Appendix 1. If no log. frame exists, score this section as a 1 (one).

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LOG. FRAME DIMENSIONS ASSESSMENT WORKING

SCORE

LOGICAL

a) Presents a logical causal chain for achieving the project development objectives

The log frame that was used at appraisal had been adopted by the Bank at the time. It was limited in some areas. For instance, activities were not directly linked to the expected outputs and outcomes. Further, the expected outputs were not clearly spelt out. Hence, the above summarised log frame is prepared based on the combination of the original log-frame and other information in the appraisal report.

2

MEASURABLE b) Expresses objectives and outcomes in a way that is measurable and quantifiable

The original log-frame provided measurable indicators, although the outcomes were not directly linked to activities and expected outputs. The modified log frame presents the means of verification or measurement in quantitative and qualitative manner

3

THOROUGH c) States the risks and key assumptions

The original log frame provided assumptions and risks. However, it missed some risks such sustainability of the SEU, retention of trained staff and other facilities at DGSM.

2

D. OUTPUTS AND OUTCOMES

I. ACHIEVEMENT OF OUTPUTS

In the table below, assess the achievement of actual vs. expected outputs for each major activity. Import the expected outputs from the log. frame in Section C. Score the extent to which the expected outputs were achieved. Weight the scores by the activities' approximate share of project costs. Weighted scores are auto-calculated by the computer. The overall output score will be auto-calculated as the sum of the weighted scores. Override the auto-calculated score, if desired, and provide justification.

MAJOR ACTIVITIES Working Score

Share of Project Costs in percentage

(as stated in Appraisal Report)

Weighted Score (auto-

calculated) Expected Outputs Actual Outputs

A1 Modern and transparent legal and regulatory framework issued.

The legal and regulatory framework is not yet developed due to shortage of project funds. The Commonwealth Secretariat is handling the activity. The final draft is expected to be produced and possibly ratified by Parliament by end of 2013.

2 1 0,02

A2.1 New and refurbished office and rock storage buildings at DGSM headquarters.

New and refurbished office and rock storage buildings at DGSM headquarters completed.

4 3 0,12

A2.2 Modern laboratories with new equipment.

Two (2) refurbished labs (assay and mineral dressing), and one (1) new geochemistry laboratory build; Several new equipment and reagents from the labs have been acquired.

3 10 0,3

A3. An operational cadastral and information systems and geological mapping coverage.

The mining Castre and Registry System will be operational by 30 June 2012.

2 4 0,08

A4 An Intranet and Internet network system in place A DGSM website www.uganda-mining.org.ug

was put in place and all the required information needed by the investors is posted on the internet website. The intranet is in place as a server is installed in the department and staff connected. The intranet helps in linking the information to staff within the department.

3 1 0,03

A6 Increase in number of organised ASMs.

From zero, fifty (50) ASM associations were formed, but 32 remain operational. Some ASM 3 0,5 0,015

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associations broke away to form joint ventures with mining companies and now have exploration licenses.

B1 Enhanced management capacity and increased awareness of local communities in several areas related to mining e.g. revenue collection, development planning for the use of mineral resources, formalised small-scale and artisanal mining

Five (5) major and 20 minor training/ consultations provided to 600 men and 400 women. Tool kit for ASMs was put in place to emphasize best practice for ASMs in mining. Nine (9) training workshops provided to 188 men and 48 women of ASMs. 3 5 0,15

B3 Data base on ASMs activities in the country developed.

The data base on ASMs from the baseline study was put in place in 2006. 750 copies of Handbook for ASMs were printed.

3 4 0,12

B4 Increase ASMs production capabilities through improved level of expertise, increased capacity, purchase of new equipment, training and new business development, including diversifications.

Successfully completed the Small Grants Program in 10 pilot sub-counties in 5 districts of Ntungamo, Kasese, Busia, Wakiso and Mukono, improving livelihoods and reducing environmental impacts. 3 2 0,06

C1 Database for environmental and Social Management and Information System (ESMIS) completed.

Database for environmental and Social Management and Information System (ESMIS) was completed. 3 1 0,03

C2 Social and Environment Unit (SEU) set up including staffing and training.

Social and Environment Unit (SEU) was set up; Three (3) people were recruited for SEU as follows: i) Programme Supervisor; ii) Social Officer; and iii) Environmental Officer. They were trained in the country and abroad using project funds. The Environment Officer left the project in 2008 for greener pastures and the other two remained until their contracts expired in December 2011 when World Bank closed the project funding (Their salaries were paid under the operational funds under World Bank). Temporarily, MEMD has put in place a Mining Engineer in the Mines Division of DGSM to handle SEU activities until the new structure of DGSM is ratified by the Ministry of Public Service and SEU incorporated. Then interviews to recruit staff for SEU will be undertaken.

2 2 0,04

C3 A computerised Environmental and Social Management Information System (ESMIS) put in place at DGSM

A computerised Environmental and Social Management Information System (ESMIS) is in place at DGSM 3 2 0,06

D1 85% coverage of high resolution survey.

648,400 line kilometres of magnetic and radiometric surveys and 22,709 line km of Electromagnetic (EM) surveys were acquired

4 28 1,12

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representing 100% of the planned activity covering 80% of the country’s landmass up from 50% in 2004.

D2 Geophysics maps. All existing published and unpublished maps of 1:100,000, 1:50,000 and 1:250,000 have been digitized and all metadata for these maps has been captured on GMIS and available to investors

4 21 0,84

D3 A modern and computerised minerals information system and improved documentation centre at DGSM.

(i) A fully operational Modern Documentation Centre has been put in place at DGSM; and (ii) Geological and Mineral Information System (GMIS) has been established at DGSM.

3 2 0,06

D4 Seismological vaults equipped with modern technology..

Two Seismological vaults at Butologo (Mubende District) and Nakawuka (Nakawuka-Wakiso district) have been constructed. The instruments are also equipped with modern technology and have a broad-band high dynamic range.

3 0,5 0,015

D5 Storage buildings rehabilitated and equipment installation, training on job completed.

The storage buildings have been rehabilitated and equipment procured ready for installation, training on job and commissioning. The cost of this activity was added to A12.

0 0

OVERALL OUTPUT SCORE [Score is calculated as the sum of weighted scores]

3

Check here to override the auto-calculated score

Provide justification for over-riding the auto-calculated score

Insert the new score or re-enter the auto calculated score 3

II. ACHIEVEMENT OF OUTCOMES 1. Using available monitoring data assess the achievement of expected outcomes. Import the expected outcomes from the log. frame in Section C. Score the extent to which the expected outcomes were achieved. The overall outcome score will be auto-calculated as an average of the working scores. Override the auto-calculated score, if desired, and provide justification.

OUTCOMES Working

Score Expected Actual

A1 Increased transparency which would help to attract potential investors in the mineral exploration and mine development and facilitating small-scale mining.

The legal framework is expected to be in place by 2013

2

A2.1 (i) Staff motivation by new office facilities; (ii) Quality services improved at DGSM

Staff are already motivated by new office facilities, which would result into better services to clients. 4

A2.2 Mineral samples to be analysed at the DGSM, and income to be generated from these laboratories.

Lab equipment in Petrology and Assay Laboratories were acquired and installed. They have been tested and working properly. The are expected to generate revenue for DGSM/GOU

2

A3 Reliable Mining Cadastre and Registry system will provide information about the precise location of mining rights, status, fees and payments, which are based on transparency. It will be useful for issuing mineral licenses based on first come first served.

The Mining Cadastre and Registry system is not in place. Once in place, it will address accuracy/transparency in issuing of mineral licenses based on first come first served and will aim at zero complaint.

2

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A4 The information required by the investors is available on the internet website and to be updated regularly. The intranet would help to share information within DGSM.

All the information required by the investors is available on the DGSM Internet website and used by investors. The intranet is being used by DGSM staff in sharing the information.

4

A6 The ASM associations are used as collateral to obtain loans from banks so as to improve on their operations in mining activities.

The associations have advanced in their operations as they can now undertake joint ventures with big mining companies thus resulting into substantial productions and profits. Formation of associations through training has enabled the ASMs to regularize and legalize their operations. This is good because Government can be able to regulate them. Similarly, formation of associations and their training in best practices in mining, marketing and environmental practices has assisted them to improve their earning capacity and lead to substantial poverty reduction.

3

B1 The sub-component is expected to improve value addition, and use of mineral revenues, increase knowledge of: market prices, using small scale technologies, and awareness of social, environment, gender, safety standards, and health issues.

As a result of this sub-component: (i) ASMs' income from precious metals increased from $3/day in 2006 to $9/day, increase of 200%; (ii) ASMs' income from industrial metals increased from $7.5/day in 2006 to $20/day, increase of 165%

3

B3 Availability of the handbooks to ASM groups and Administrative Officers in the mining districts would help to improve the monitoring of mining activities compliancy with mining standards.

Availability of the handbooks to ASM groups and Chief Administrative Officers (CAOs) in the mining districts of Uganda has improved on the monitoring of mining activities compliancy with mining standards.

3

B4 ASMs' income from mining and other activities is expected to increase significantly over time.

(i) ASMs' income from precious metals increased from $3/day in 2006 to $9/day, increase of 200%; (ii) ASMs' income from industrial metals increased from $7.5/day in 2006 to $20/day, increase of 165%.

3

C1 Database prepared from baseline studies used to prepare a modern and computerised ESMIS.

The Baseline data was used to prepare a modern and computerised ESMIS. 3

C2 The Social and Environmental Unit (SEU) is to review environment impact assessments (EIAs) and environment audits. It will also be a source of information for the National Environment Management Authority (NEMA) in the mining sector.

The SEU: (i) is to be the lead agency for the National Environment Management Authority (NEMA) in the mining sector. (ii) will review environment impact assessments (EIAs) and environment audits. (iii) links with Ministry of Gender for gender mainstreaming in ASM activities.

3

C3 The ESMIS is to handle policies, guidelines, and monitoring standards related to environment in mining

The ESMIS is used handle policies, guidelines, and monitoring standards related to environment in mining. 3

D1 (i) Increase in exploration licenses issued; (ii) Increase in issuance of licenses to ASMs from 100 licenses before the project to a target of 300 licenses by 2011; (iii) increased cumulative mineral exploration and development expenditure to a target of US$ 30 million; (iv) increased license fees and royalties; (v) Investors purchase data from DGSM.

(i) 607 exploration licenses issued by end 2011 up from 190 in 2005; (ii) 726 licenses issued to ASMs by end 2011, up from 100 licenses in 2005 (iii) increased cumulative mineral exploration and development expenditure of US$ 346 million since 2005 to-date against a target of US$ 30 million; (iv) increased license fees and royalties from US$ 0.63 million in 2004 to US$ 5.28 million by end of 2011; (v) Over 35 investors, including some of the largest mining companies in the world, purchased data from DGSM.

4

D2 The maps are used (i) in mineral exploration by investors; and (ii) others (infrastructure planning, engineering geological studies, agriculture, land use, water resources and environmental .management.

Over 35 investors, including some of the largest mining companies in the world, purchased data from DGSM.

4

D3 The computerised geological information data is available to investors at a reduced time.

All the geological information data that has been digitally captured and installed on computers can now be available 3

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to investors at a reduced time of one (1) day compared the previous 14 days.

D4 The seismological equipment would capture earthquakes. The data would be transmitted automatically to the National Data Centre in Entebbe.

The seismological equipment can capture both small and big earthquakes. The data can be transmitted to the National Data Centre in Entebbe in near real time. The data can also be easily integrated with global seismic data.

3

D5 Modern geological storage facilities at DGSM would be most valuable for the demonstration of the economic mineral potential as well as reference for further geological investigation. It will increase public awareness and promote private sector participation in the mineral sector.

Improved impact of the material exhibited to foreign and national visitors.

3

OVERALL OUTCOME SCORE [Score is calculated as an average of the working scores]

3

Check here to override the auto-calculated score

Provide justification for over-riding the auto-calculated score

Insert the new score or re-enter the auto calculated score 3

2. Additional outcomes. Comment on the project's additional outcomes not captured in the log. frame, including cross-cutting issues (e.g., gender).

A lot is being done in this area. For instance, so far Airborne Geophysical Data has been collected over 80% of the area. The GOU is looking for resources from the World Bank to fund the remaining 20% of the area. The area, which is Karamoja, has been identified so far as having high potential for mineral resources.

3. Risks to sustained achievement of outcomes. State the factors that affect, or could affect, the long-run or sustained achievement of project outcomes. Indicate if any new activity or institutional change is recommended to help sustain outcomes. The analysis should draw upon the sensitivity analysis in Annex 3, where appropriate.

(i) sustainability of Social and Environment Unit (SEU) is in doubt due to difficulty in retaining staff due to uncompetitive remunerations; (ii) retention of trained staff at DGSM is at risk due to low remuneration compared to private sector worldwide; (iii) Maintaining lab equipment and other facilities at DGSM and sustaining them for a long period could be at risk due to inadequate budget; (iv) ASMs need continuous assistance from DGSM which could be difficult due to budget constraint and a need to bring on board Microfinance; and (v) a need for a successor project to consolidate the gains so far including gained made on ASMs and airborne survey for Northern Uganda. This risk is to be minimised by the fact that MEMD has requested the Ministry of Finance to allow DGSM to retain income from lab activities for the benefit of maintaining the lab equipment and other assets and ensuring quality services.

E. PROJECT DESIGN AND READINESS FOR IMPLEMENTATION 1. State the extent to which the Bank and the Borrower ensured the project was commensurate with the Borrower’s capacity to implement by designing the project appropriately and by putting in place the necessary implementation arrangements. Consider all major design aspects, such as extent to which project design took into account lessons learned from previous PCRs in the sector or the country (please cite key PCRs); whether the project was informed by robust analytical work (please cite key documents); how well Bank and Borrower assessed the capacity of the implementing agencies and/or Project Implementation Unit; scope of consultations and partnerships; economic rationale of project; and provisions made for technical assistance. [200 words maximum. Any additional narrative about implementation should be included at Annex 6: Project Narrative]

The GOU and IDA (Lead Financier) prepared the project details, which were finalised in September 2003. The project design was based on the World Bank’s experience with similar projects. The World Bank had in the past financed similar capacity building operations for mining in Guinea, Ghana, Mali, Burkina Faso, Tanzania and Madagascar. ADF had also co-financed one similar operation in Mozambique with the World Bank. Experience from these countries had demonstrated that improving the investment environment increases the ability of a country to attract and retain appropriate private investment. Although DGSM had no past experience in managing such a project, training was carried and experienced staff recruited to manage the PCU. The project implementation plan (PIP) and the Project Procurement Plan were helpful in implementing the project.

WORD COUNT 127

12

2. For each dimension of project design and readiness for implementation, provide a brief assessment (up to two sentences). Insert a working score, using the scoring scale provided in Appendix 1.

PROJECT DESIGN AND READINESS FOR IMPLEMENTATION DIMENSIONS

ASSESSMENT WORKING

SCORE

REALISM a) Project complexity is matched with country capacity and political commitment.

The country's capacity to handle the project complexity was adequately covered and solutions put in place such as institutional capacity building and human capital building. The political commitment was already there, an example being a Mineral Policy that had just been put in place by the GOU.

3

RISK ASSESSMENT AND MITIGATION

b) Project design includes adequate risk analysis.

There was risk analysis that covered several areas. However, the risks of sustaining the project's key areas such the SEU, lab equipment and retention of trained staff at DGSM was not adequately covered.

2

USE OF COUNTRY SYSTEMS

c) Project procurement, financial management, monitoring and/or other systems are based on those already in use by government and/or other partners.

The project was implemented through the PCU, using the Project Implementation Plan and the Project Procurement Plan. The use of country M&E, procurement, financial and management systems by the project was minimum. For financial management, however, the project used the existing system within MEMD which was mainly manual. The system was supposed to be computerised from the project resources. Unfortunately, the purchased financial package system failed to work. The project was also helped by the Project Financial Manual prepared by IDA.

2

For the following dimensions, provide separate working scores for Bank performance and Borrower performance:

WORKING SCORE

Bank Borrower

CLARITY

d) Responsibilities for project implementation were clearly defined.

The project had 3 co-financiers (AfDB, IDA and NDF). The responsibility of each co-financier was very clear. The Bank's components were clear from the beginning. It was also clear that the GOU was to meet 10% of the total project cost as counterpart to ADF Components funding. It was also understandable from appraisal that DGSM would be the Executing Agency and the PCU would be formed under DGSM to implement the project. It was also evident that the Project Coordinator would manage the project and the supporting expertise needed was clearly defined.

4 4

PROCUREMENT READINESS

e) Necessary implementation documents (e.g. specifications, design, procurement documents) were ready at appraisal.

A Project Implementation Plan (PIP) and a Project Procurement Plan were prepared and ready in 2003 and agreed upon by the co-financiers. Procurement arrangements for the ADF components were clearly spelt out in the appraisal report. The PIP was ready by the time of ADF appraisal.

3 3

MONITORING READINESS

f) Monitoring indicators and monitoring plan were agreed upon before project launch.

The key performance indicators were clearly spelt out and agreed upon by the stakeholders. During the mid-term review however, some activities were modified or removed and replaced by other activities which also led to modifying some performance indicators. The modifications, however, were minor and did not affect the overall performance indicators.

3 3

BASELINE DATA

h) Baseline data were available or are were collected during project design.

Baseline data for ASMs and environment and social affects were collected during project implementation. Most of the data was not readily available at appraisal.

3 3

13

F. IMPLEMENTATION

1. State the major characteristics of project implementation with reference to: adherence to schedules, quality of construction or other work, performance of consultants, effectiveness of Bank supervision, and effectiveness of Borrower oversight. Assess how well the Bank and the Borrower ensured compliance with safeguards. [200 words maximum. [Additional narrative about implementation are included in Annex 4: Project Narrative.]

Adherence to schedule: The project financiers did not come on board at the same time. IDA signed the loan Agreement in January 2004 but started disbursing in September 2004; AfDB Protocol of Agreement was signed in January 2005 but started disbursing in December 2005; and NDF that signed the Loan Agreement in January 2006 but started disbursing in August 2009 because it re-structuring its organization at the time. These shortcomings resulted in slow progress of activities which did not go as planned.

Performance of Contractors and Consultants: The quality of service provided by all consultants and contractors is satisfactory. For instance, the airborne survey was carried out effectively and produced very good results that is being used by various stakeholders including GOU and potential investors. The lab equipment were not installed at the time of the PCR, however the construction of the various buildings at the DGSM headquarter in Entebbe was quite good. Performance of consultants: The consultants performed very well and in most cases some of them were very kind enough to postpone (re-schedule) their activities at no additional cost when the civil works delayed to commence because their outputs (milestones) were pegged to the availability of completed buildings.

Effectiveness of Bank supervision: Bank supervision was satisfactory as this helped the Project Coordination Unit (PCU) to address and improve on issues that were delaying the project implementation process. The Bank had 9 field supervision missions with co-financiers including the mid-term review, and 2 supervision missions without co-financiers. The quality of the aide memoires of the supervision missions was quite good and the quality of joint mid-term review was excellent. The Executing Agency responded favourably to the recommendations of the supervision missions.

Effectiveness of the Borrower oversight: The borrower had in place a Steering Committee chaired by the Permanent Secretary, MEMD and continuously guided the project implementation systematically. The borrower also maintained the disbursement of counterpart funds to be regular and timely. In spite of some project delays and other hindrances and constraints, the DGSM/PCU managed to implement the project successfully.

Both the Bank and the Borrower ensured safeguards of the project especially by maintaining monitoring safeguards related especially in the small-scale and artisanal mining areas. The compliance with safeguards continued since they were aimed at sensitizing the people at reducing potential environmental damages and also addressing possible income and livelihood status of people after mine closure.

COUNTS BY CHARACTER NOT BY WORDS 2680

2. Comment on the role of other partners (e.g. donors, NGOs, contractors, etc.). Assess the effectiveness of co-financing arrangements and of donor coordination, if applicable.

The project was co-financed with IDA (59%), ADF (18%), NDF (16%), and GOU (7%). Without co-financing this project some of the major components of the project would have been left out. Thus, the success of the project is attributed largely to the co-financing arrangement. The co-financiers provided funds for different sub-components, which were in some cases implemented at different times. Each development partner operated separately in terms of disbursement and procurement, under the co-ordination of DGSM. There was effective coordination in terms of supervision because there were several joint supervision missions. In addition, the mid-term review was carried out jointly. However, the start of the project implementation was not harmonised because ADF's grant became effective one year after IDA, while NDF credit became effective two years after IDA. In spite of that, the co-financing was effective because all the co-financiers had one principle objective, viz. enable good environment in the mining sector that would stimulate private investments in the sector and at the same time help the ASMs improve the quality and quantity of their operations.

3. Harmonization. State whether the Bank made explicit efforts to harmonize instruments, systems and/or approaches with other partners.

There was a slippage in terms of harmonising the project implementation schedules. The project financiers did not come on board at the same time, which led to various problems. For instance, IDA signed the loan Agreement in January 2004 but started disbursing in September 2004; AfDB Protocol of Agreement was signed in January 2005 but started disbursing in December 2005; and NDF that signed the Loan Agreement in January 2006 but started disbursing in August 2009 because it re-structuring its

14

organization at the time. This shortcoming resulted into a number of problems beyond the control of the project management. The major problem was inflation, which resulted in increase in contract prices compared to the estimated price at the time of the project design/appraisal resulting into a total cost overrun of USD 5 million which was covered by IDA. In the meantime, during this period the mineral sector experienced a mineral boom that resulted into great demand for services hence hiking in fees by consultants. This resulted into one firm called African Development Management (ADM) that was about to sign a contract for the Enhancement of the Legal and Regulatory Mineral Framework Study to pull out. This situation could have been avoided if there had been proper coordination and harmonisation in terms of implementation schedule.

4. For each dimension of project implementation, assess the extent to which the project achieved the following. Provide a brief assessment (up to two sentences) and insert a working score, using the scoring scale provided in Appendix 1.

PROJECT IMPLEMENTATION DIMENSIONS ASSESSMENT WORKING

SCORE

TIMELINESS

a) Extent of project adherence to the original closing date. If the number on the right is: below 12, "4" is automatically scored between 12.1 to 24, "3" is automatically scored between 24.1 to 36, "2" is automatically scored beyond 36.1, "1" is automatically scored

Difference in months between original closing date and actual closing date or date of 98% disb. rate. (auto-generated)

3

17,2

BANK PERFORMANCE

b) Bank complied with:

Environmental Safeguards The project was classified in the ADF environment category 2. The project did not directly involve in mining activities. The project had therefore manageable and mitigatable environmental and social impacts. Besides, one of the project sub-components (C3) was to establish an environment and social information management system (ESIMS) for DGSM.

3

Fiduciary Requirements Through desk and field supervisions, the Bank was able to ensure that the GOU complies with the Grant Protocol Agreement, as well as with the ADF's procurement, disbursement and audit requirements.

3

Project Covenants The project covenants were fulfilled by the grant recipient. However, there has been a problem of accountability for the Special Account that was set up to cater for small procurement activities for works and training.

3

c) Bank provided quality supervision in the form of skills mix and practicality of solutions

Most supervision was carried out jointly with the co-financiers and IDA and NDF. The Bank had 8 field supervision missions with co-financiers including the mid-term review. The skill mix was ensured by joint supervision missions. The quality of the aide memoires of the joint supervision missions was quite good and the outcome of the joint mid-term review was satisfactory.

3

d) Bank provided quality management

oversight

The Bank had a total of 10 field supervision missions which helped it to effectively monitor the progress of the project implementation. The joint supervision missions helped to take collective responsibility and decisions.

3

BORROWER PERFORMANCE

e) Borrower complied with:

Environmental Safeguards There were no negative environment issues. The project helped to introduce the ESIMS and a SEU at DGSM.

3

15

Fiduciary Requirements The GOU formulated and adopted a strategy to reform the legal and regulatory framework of the mineral sector to establish an environment that would be attractive to private investment. The GOU was committed to the promotion of sustainable minerals development, while opening up the sector to private investment, including ASMs. In 2000 and 2001, the GOU held two national Mineral Policy Consultative Workshops on Mineral Policy and Mining Legislation. From the two workshops the MRMCB was conceived, to which the GOU has been fully committed ever since. The GOU also met its financial obligations and met all the requirements under the ADF, IDA and NDF agreements.

3

Project Covenants The project covenants were fulfilled by the grant recipient. However, there has been a problem of accountability for the Special Account that was set up to cater for small procurement activities for works and training.

2

f) Borrower was responsive to Bank supervision findings and

recommendations

The GOU was responsive to the Bank supervision findings and recommendations including swapping sub-components with NDF.

3

g) Borrower collected and used monitoring information for decision

making

PCU produced quarterly reports, which were useful in determining the next course of action for each particular activity. The mid-term review information was used to restructure the project after identifying cost overruns of various project activities. Supervision information was very helpful in making decisions that propelled the project to progress.

3

G. COMPLETION

1. IS THE PCR DELIVERED ON A TIMELY BASIS, IN COMPLIANCE WITH BANK POLICY?

Date project reached 98% disb. Rate (or closing date if applicable) (auto-generated)

Date PCR was sent to pcr@afdb.org MM/DD/YY

Difference in months (auto-calculated)

WORKING SCORE if the difference is 6 months or less, a 4 is scored. If the difference is 6.1 or more, a 1 is scored (auto-calculated)

05/31/12 09/07/12 3,3 4

2. Briefly describe the PCR Process. Describe the Borrower’s and co-financers' involvement in producing the document. Highlight any major differences of opinion concerning the assessments made in this PCR. Describe the team composition and confirm whether a site visit was undertaken. Mention any major collaboration from other development partners. State the extent of field office involvement in producing the report. Indicate whether comments from Peer Reviewers were received on time (provide names and positions of Peer Reviewers). [100 words maximum]

PCU prepared brief for PCR Team. Discussions held with PCU Coordinator. The Procurement Specialist and Accountant had left the project. A mid-term review and Aide-memoire of 2011 were useful for the PCR. The PCR Team consisted of Senior Investment Officer (UGFO) and a Consultant, with support from the Task Manager (ONEC.2). The Team visited project sites at DGSM headquarters and at four districts.

IDA has prepared its PCR and NDF will prepare its PCR in September 2012. The outcome of the PCR was shared with IDA team. The PCRs will be shared with co-financiers.

WORD COUNT 94

16

H. LESSONS LEARNED

Summarize key lessons for the Bank and the Borrower suggested by the project’s outcomes [250 words maximum. Any additional narrative about lessons learned, if needed, must be placed in Annex 6: Project Narrative]

Sustaining the outcomes of such a project can be a challenge. For instance, retention of staff that has been trained with the project proceeds is difficult due to high demand for qualified staff in the minerals sector. Another example is the maintenance of the equipment for the lab, which could be at risk due to budget constraint. Retaining part of DGSM incomes could minimise the problem by utilising the retained funds to maintain the project facility and to provide special allowances for the staff at DGSM.

The ASM activities were quite appreciated by the ASMs. The outcomes of these activities are quite clear and would benefit in contributing to poverty reduction. However, the assistance provided was limited to few areas of ASMs. Collaboration with other government agencies responsible for micro finance and gender issues could have been more helpful. For instance, involvement of the Department responsible for microfinance within the Ministry of Finance and Planning could help in taking over the responsibility of providing funding to the ASMs.

There has been good collaboration between the co-financiers (ADF, IDA and NDF). The joint supervision missions including the joint mid-term review were quite useful in terms of taking collective decisions and responsibilities. For instance, the swapping of ADF’s lab consultancy service sub-component for NDF’s lab equipment was among the significant changes to the project component following a one year delay in constructing the lab building. As the Bank’s closing date (November 2011) for the project was approaching fast the swapping with NDF whose closing date was in September 2012 was the best option available at the time. The lesson is that continuous collaboration between co-financiers during project implementation can lead to better results.

WORD COUNT 281

I. PROJECT RATINGS SUMMARY

All working scores and ratings are auto-generated by the computer from the relevant section in the PCR.

CRITERIA SUB-CRITERIA WORKING

SCORE

PROJECT OUTCOME

Achievement of outputs 3

Achievement of outcomes 3

Timeliness 3

OVERALL PROJECT OUTCOME SCORE 3

BANK PERFORMANCE

Design and Readiness

Project Objectives were relevant to country development priorities. 4

Project Objectives could in principle be achieved with the project inputs and in the expected time frame.

3

Project Objectives were consistent with the Bank’s country or regional strategy 4

Project Objectives were consistent with the Bank’s corporate priorities 4

The log frame presents a logical causal chain for achieving the project development objectives. 2

The log frame expresses objectives and outcomes in a way that is measurable and quantifiable. 3

The log frame states the risks and key assumptions. 2

Project complexity was matched with country capacity and political commitment. 3

Project design includes adequate risk analysis. 2

Project procurement, financial management, monitoring and/or other systems were based on those already in use by government and/or other partners. 2

Responsibilities for project implementation were clearly defined. 4

Necessary implementation documents (e.g. specifications, design, procurement documents) were ready at appraisal. 3

Monitoring indicators and monitoring plan were agreed upon during design. 3

Baseline data was available or were collected during design. 3

PROJECT DESIGN AND READINESS SUB-SCORE 3

17

Supervision:

Bank complied with:

Environmental Safeguards 3

Fiduciary Requirements 3

Project Covenants 3

Bank provided quality supervision in the form of skills mix provided and practicality of solutions.

3

Bank provided quality management oversight. 3

PCR was delivered on a timely basis 4

SUPERVISION SUB-SCORE 3

OVERALL BANK PERFORMANCE SCORE 3

BORROWER PERFORMANCE

Design and Readiness

Responsibilities for project implementation are clearly defined. 4

Necessary implementation documents (e.g. specifications, design, procurement documents) are ready at appraisal.

3

Monitoring indicators and monitoring plan are agreed upon 3

Baseline data are available or are being collected 3

PROJECT DESIGN AND READINESS SCORE 3

Implementation

Borrower complied with:

Environmental Safeguards 3

Fiduciary Requirements 3

Project Covenants 2

Borrower was responsive to Bank supervision findings and recommendations. 3

Borrower collected and used of monitoring information for decision-making. 3

IMPLEMENTATION SUB-SCORE 3

OVERALL BORROWER PERFORMANCE SCORE 3

J. PROCESSING STEP SIGNATURE AND COMMENTS DATE

Sector Manager Clearance

Regional Director Clearance

Sector Director Approval

18

Scale for Working Scores and Ratings APPENDIX 1

SCORE EXPLANATION

4 Very Good- Fully achieved with no shortcomings

3 Good- Mostly achieved despite a few shortcomings

2 Fair- Partially achieved. Shortcomings and achievements are roughly balanced

1 Poor- Very limited achievement with extensive shortcomings

NA Non Applicable

Note: The formulas round up or down for decimal points. Only whole numbers are computed.

I

LIST OF ANNEXES

Mandatory 1. Project Costs and Financing b. Financing by sources of funds 2. Bank Inputs. List the key team members, and their specialties, during preparation and supervision. Provide a consolidated list of Preparation, Supervision and Completion Missions in chronological order. Provide the date and ratings of the last supervision report. 3. Compliance with Legal Requirements 4. Project Narrative 5. List of Support Documents

Optional 6. Project Narrative. Key factors not covered in the main template that affected the design and implementation of the project. Such factors, both positive and negative, could include: climate and weather, political changes, contractual or personnel matters, technical issues, procurement processes, and interactions with other partners. If any of these factors is significant enough to affect the evaluation ratings, it should be noted in the template with a reference to this annex.

II

PROJECT COST AND FINANCING ESTIMATES ANNEX 1

Components/activities Finance In Million USD

FC LC Total A. Strengthening of Governance in Minerals Sector 4,18 5,02 9,2 22%

A1 Enhancement of Legal-Regulatory Framework IDA 0,27 0,33 0,6 1%

A2 Institutional Strengthening for the Management of Mineral Resources IDA 0%

(i) Design and Modernisation of the Institutional Model IDA 0,55 0,65 1,2 3%

(ii) Institutional Infrastructure and Capacity Building Programme ADF 2 2,4 4,4 10%

A3 Mining Cadastre and Registry System for Headquarters and Regional offices IDA 0,73 0,87 1,6 4%

A4 Development of Intranet & Internet Network IDA 0,8 0,22 0,4 1%

A5 Establishment of Mineral Promotion Unit IDA 0,36 0,44 0,8 2%

A6 Strengthening of Mineral Associations and Industrial Mineral studies IDA 0,09 0,11 0,2 0%

B. Community Development & Mineral Resources IDA 2 3,04 5,04 12%

B1 Mineral Resources Management by Communities IDA 0,77 1,17 1,94 5%

B2 Decentralize Collection of Some Mining Taxes IDA 0,16 0,24 0,4 1%

B3 Communities and artisanal and small-scale mining IDA 0,67 1,03 1,7 4%

B4 Small Grants Program to support diversification of local economic development and technical assistance

IDA 0,32 0,48 0,8 2%

B5 Information and Monitoring IDA 0,08 0,12 0,2 0%

C. Establishment of Environmental/Social Systems IDA 1 1,35 2,35 6%

C1 Baseline Studies and Development of environmental regulations for mining

IDA 0,21 0,29 0,5 1%

C2 Institutional set-up and capacity building IDA 0,28 0,37 0,65 2%

C3 Environmental Management System IDA 0,33 0,47 0,8 2%

C4 Consultation and participatory procedures IDA 0,09 0,11 0,2 0%

C5 Component supervision IDA 0,09 0,11 0,2 0%

D. Geo-Information and Development IDA 16,59 5,37 21,96 51%

D1 Airborne geophysics 0%

Airborne geophysical survey (contract works) IDA/ADF 7,78 2,52 10,3 24%

Processing, interpretation, publication of data NDF 1,44 0,46 1,9 4%

D2 Complementary Mapping & Resource Assessment IDA/NDF 6,62 2,14 8,76 21%

D3 Geological Mineral information system NDF 0,6 0,2 0,8 2%

D4 Seismological network ADF 0,5 0,05 0,2 0%

D5 Geological Museum and Rock Storage Facility (incorporated within Component 1) ADF 0%

E. Project Management and Coordination 0,75 1,3 2,05 5%

E1 Operation of PCU IDA 0,53 0,92 1,45 3%

E2 Technical Coordination and supervision IDA 0,22 0,38 0,6 1%

0%

PROJECT COST WITHOUT CONTINGENCIES 24,52 16,08 40,6 95%

0%

CONTINGENCIES/NON-ALLOCATED 1,47 0,63 2,1 5%

TOTAL PROJECT COST 25,99 16,71 42,7 100%

By the time of the PCR (April 2011, the project funding from the co-financiers was USD 31.23 million from IDA, UA 4.81 million from AfDB, and USD 4.2 million from NDF. The amount contributed by the GOU is unknown. For IDA, USD 27.15 came from the first facility approved in 2003 and USD 4.08 million from the second (supplementary) facilty provided in 2008.

III

BANK INPUTS ANNEX 2

African Development Fund (ADF)

Mission/Monitoring Activity Start Date End Date

Project Launch Mission 15/03/2005 17/03/2005

Supervision Mission 24/07/2005 30/07/2005

Monitoring by Operations officer 31/08/2005 31/08/2005

Sector Portfolio Improvement Plan (Jinja) 06/10/2005 07/10/2005

Sector Portfolio Improvement Plan (Masaka) 06/07/2006 07/07/2006

Monitoring mission by new Task Team Leader 15/02/2007 15/02/2007

Supervision Mission by Investment Officer, UGFO 09/12/2008 15/12/2008

Disbursement supervision mission 10/07/2009 10/07/2009

Follow up of External Audit Recommendations to the Special Account

06/09/2010 21/09/2010

Implementation Completion Mission 26/03/2012 04/04/2012

Joint mission (IDA, ADF and NDF)

Mission/Monitoring Activity Start Date End Date

Joint (IDA/AfDB/NDF) Field Supervision 10/01/2006 12/01/2006

Mid-Term Review (IDA/AfDB/NDF) 09/01/2008 22/01/2008

Joint (IDA/NDF) Field Supervision 05/01/2009 10/01/2009

Joint (IDA/AfDB/NDF) Field Supervision 14/07/2009 24/07/2009

Joint (IDA/AfDB/NDF) Field Supervision 05/05/2010 14/05/2010

Joint (IDA/AfDB/NDF) Field Supervision 04/10/2010 13/10/2010

Joint (IDA/AfDB/NDF) Field Supervision 24/01/2011 03/02/2011

Joint (IDA/AfDB/NDF) Field Supervision 30/05/2011 09/06/2011

Joint (IDA/AfDB/NDF) Field Supervision 28/11/2011 09/12/2011

Table 5.2: Procurement Arrangements for ADF Components

Category In Million UA

Shortlist IS Others Total

Goods and works:

1. Laboratory Equipment 1.23(1.15) 1.23(1.15)

2. Renovation and setting up of five seismological stations 0.17(0.16) 0.17(0.16)

Consultancy Services:

3. Airborne Geo Survey 4.10(3.81) 4.10(3.81)

Others:

Training 0.25(0.23) 0.25(0.23)

Total 4.10(3.81) 1.40(1.31) 0.25(0.23) 5.75(5.35) *Figures in brackets are amounts financed by ADF. IS - International Shopping.

IV

Date Activity Mission Team Mission Team

juil-01 The Government of Uganda made a request to the Bank Group to finance the MRMCB.

nov-02 Bank fielded an identification/fact-finding mission. Project was still under preparation.

Industrial Engineer Industrial Engineer

sept-03 GOU completed preparation of the project.

nov-03 The Bank Group fielded a preparation mission to Uganda. Financial Analyst Financial Analyst

Mining Engineer Mining Engineer

févr-04 GOU reconfirmed its request to the ADF to finance the project.

avr-04 The Bank Group mounted an Appraisal Mission. Financial Analyst Financial Analyst

Mining Engineer Mining Engineer

Environment Officer Environment Officer

May - July 2004 Internal Working Group (IWG),

Inter-departmental Working Group (IDWG)

Senior Management Committee (SMC)

Negotiations

Translation

V

Last Supervision mission

RATINGS

INDICATORS Precedings report This report

27.06.2005 05.12.2005 09.04.2007 05.12.2007 26.02.2008

A. PROJECT IMPLEMENTATION

Compliance with loan conditions precedent to entry into force

0 0 0 - 0

Compliance with General Conditions 0 0 0 - 0

Compliance with Other Conditions 0 0 0 - 0

B. PROCUREMENT PERFORMANCE

Procuremet of Consultancy Services 2 3 3 - 3

Procurement of Goods and Works 2 - 2

C. FINANCIAL PERFORMANCE

Availability of Foreign Exchange 3 3 3 - 3

Availability of Local Currency 1 2 3 - 2

Disbursement Flows 1 2 1 - 1

Cost Management 2 2 1 - 1

Performance of Co-Financiers 3 3 3 - 3

D. ACTIVITIES AND WORKS

Adherence to implementation schedule 1 2 2 - 1

Performance of Consultants or Technical Assistance

3 3 2 - 1

Performance of Contractors - 1

Performance of Project Management 2 2 1 - 1

E. IMPACT ON DEVELOPMENT

Likelihood of achieving development Objectives

2 3 3 - 2

Likelihood that benefits will be realized and sustained beyo

2 3 3 - 2

Likely contribution of the project towards an increase in

2 2 2 - 2

Current Rate of Return - 0

F. OVERALL PROJECT ASSESMENT

Current Supervision Average 2 2,5 2,23 - 1,39

Current Trend over time 2,03

RATINGS: 3 = Highly Satisfactory, 2 = Satisfactory, 1 = Unsatisfactory, 0 = Highly Unsatisfactory, ‘ ‘ = Non applicable

VI

COMPLIANCE WITH LEGAL COVENANTS ANNEX 3

The Project complied with all legal covenants as per the Agreements with Co-financiers

1 MEMD submitted a Financial Management Manaual for the project that described its internal control and

accounting procedures and other related financial management aspects

2 The Project Coordination Unit (PCU) was adequatedly staffed with qualified professionals whose experience

and qualifications were found acceptable to the co-financiers (ADF, IDA and NDF)

3 The Social and Environmental Unit (SEU) was established within DGSM

4 Terms of Reference for the audit of the project's financial statements agreed upon.

5 Submission of Financial Management Reports

6 Annual Audit of the Project Accounts was carried out on schedule and all opinions were unqualified.

VII

PROJECT NARATIVE ANNEX 4 Adherence to schedule: The project financiers did not come on board at the same time. IDA signed the loan Agreement in January 2004 but started disbursing in September 2004; AfDB Protocol of Agreement was signed in January 2005 but started disbursing in December 2005; and NDF that signed the Loan Agreement in January 2006 but started disbursing in August 2009 because it re-structuring its organization at the time. Besides, the project implementation had difficulty to adher to planned schedules for various activities due to procurement processes that were very lengthy. For instance, for ICB (which was the case for all procurements in the excess of US$ 250,000 in case of consultants), the process would take 9 to 12 months. The delays were mostly due to a series of stages involving clearances and no-objections by the financiers, MEMD’s Contract Committee and the Ministry of Justice.These shortcomings resulted in slow progress of activities which did not go as planned. For instance, the procurement of equipment that needed to be installed in the laboratories delayed to be procured because of the delay of civil works. This delay also caused the consultancy for the establishment of the laboratories to be halted. As time went on, the prices of what was planned also changed and this resulted into scaling down on the activities. Secondly, as AfDB was to close end of November 2011, it was agreed in the joint Financiers’ supervision mission of 6th -14th May, 2010 to swap some of the activities under AfDB funding with those of Nordic Development Fund (NDF) that was to close in June 2012. The Bank extended the date of last disbursement to 31 May 2012.

Performance of Contractors and Consultants: The quality of service provided by all consultants and contractors is satisfactory. For instance, the airborne survey was carried out effectively and produced very good results that is being used by various stakeholders including GOU and potential investors. The lab equipment were not installed at the time of the PCR, however the construction of the various buildings at the DGSM headquarter in Entebbe was quite good. Effectiveness of Bank Supervision: Most supervision was carried out jointly with the co-financiers and IDA and NDF. The Bank had 9 field supervision missions with co-financiers including the mid-term review, and 2 supervision missions without co-financiers. The quality of the aidememoires of the supervision missions was quite good and the quality of joint mid-term review was excellent. The Executing Agency responded favourably to the recommendations of the supervision missions. Thus, the quality of construction or other work: Quality of construction was good and Ministry of Works and Transport (MoW&T) that signed a memorandum of Understanding (MoU) with MEMD to oversee the management of Government infrastructure attested that good work was done and all certificates and invoices presented by the consultant for supervision and the contractor respectively were approved and payments sanctioned. Performance of consultants: The consultants performed very well and in most cases some of them were very kind enough to postpone (re-schedule) their activities at no additional cost when the civil works delayed to commence because their outputs (milestones) were pegged to the availability of completed buildings. An example was M/S Beak Consultants handling the Establishment of the Modern Documentation Centre where the activity was supposed to be accomplished in July 2009 but the consultant is still around and will finish the activity by the end of June 2012 at no additional cost.

Effectiveness of Bank supervision: Bank supervision was very satisfactory as this helped the Project Coordination Unit (PCU) to address and improve on issues that were delaying the project implementation process.

Effectiveness of the Borrower oversight: The PCU faced a number of challenges including a loss of its first project coordinator (RIP) in September 2008. The Procurement Specialist left the project in for greener pastures in December 2007, The situation was compounded with the fact that after training his assistance,. he also left the PCU for better opportunities. This situation created a wide gap of project management as the caretakers from the civil service structure had to learn on the job. Worse still there was inadequate remuneration commensurate with the additional responsibilities of PCU staff who are also Government The borrower had in place a Steering Committe chaired by the Permanent Secretary, MEMD and continued to guide the project implementation systematically. The borrower also maintained the disbursement of counterpart funds to be regular and timely. In spite of these hindrances and constraints, the DGSM/PCU managed to implement the project successfully.

Bank and the Borrower ensured compliance with safeguards: Both the Bank and the Borrower ensured safeguards of the project especially by maintaining monitoring safeguards related especially in the small-scale and artisanal mining areas. The compliance with safeguards continued since they were aimed at sensitizing the people at reducing potential environmental damages and also addressing possible income and livelihood status of people after mine closure.

VIII

LIST OF SUPPORT DOCUMENTS ANNEX 5

1 Aprraisal Report: Mineral Resources Management and Capacity Building (ADF/BD/WP/2004/96

2

Joint-Mid-term Review: Uganda Sustainable Management of Mineral Resources Project (SMMRP ) and Mineral Resources Management Capacity Building (MRMCB)

3 Implementation Support Mission (November 28 - December 9, 2011)

4

Uganda Sustainable Management of Mineral Resources Project and Mineral Resources Management Capacity Building Project

5

Quartery Progress Report October 2011 - March 2012 - Mineral Resources Management Capacity Building - Ministry of Energy and Mineral Development

6

Aide-Memoires and Supervision Reports