Kinshasa, DRC — 09 November 2012 – Randgold Resources CEO Mark Bristow says he has sympathy with the Democratic Republic of Congo (DRC), which is seeking to alter its mining code to give it an undiluted 35% of new mining projects built in the Central African country.
Bloomberg News reported that the DRC was considering proposals to revamp its mining laws that would give government a 35% stake in the mining industry, as well as higher proportion of royalties.
The report was later clarified by DRC mines minister Martin Kabwelulu, who told Reuters the DRC government would not apply the mining code changes if implemented retroactively.
“I am sympathetic to African governments, especially the DRC. There is a lot of exploitation of African countries’ resources without the revenue,” said Bristow in an interview with Miningmx. “It’s not all about greed in Africa.”
Last month, Bristow warned African countries that they risked damaging their economies by pushing for “quick returns” from the mining companies operating in their countries.
Following the release of Randgold Resources third quarter results today, however, Bristow was more conciliatory, saying that the DRC would follow due process in implementing an update of its 10-year-old mining code, culminating in a tripartite discussion before promulgation.
Commenting on whether Africa had become more unpredictable since Randgold Resources had commissioned its first mine (Morila) in Mali in 2000, Bristow said: “It’s become a much easier environment. If you want to invest in Africa, you need a quality asset in which all stakeholders can participate.”
In the last two months, Ghana and Côte d’Ivoire have expressed an interest in introducing a 10% and 19% windfall tax on mining profits respectively.
Randgold Resources posted a 15% quarter-on-quarter decline in net profit to US$121.3 million, a performance that was still “in line” with the third quarter of the company’s 2011 financial year.
Production came in at 204,475oz, slightly down on the previous quarter. Sales were 10% lower, however. This was put down to timing with shipping and the effect of a stock-take at the refinery.
Speaking to Reuters, Bristow said annual production would be closer to the 825,000oz low end of a full-year output range, which stretched to 865,000oz.
Source: Miningmx. For more information, click here.