HomeBase MetalsDRC government approves Metorex operations

DRC government approves Metorex operations

Underground at Metorex’s
Kinsenda copper mine
in the DRC
Johannesburg, South Africa — MININGREVIEW.COM — 09 February 2009 – The Congolese subsidiary companies of Metorex Limited – JSE-listed independent, diversified mining company active in base metals, industrial minerals, and gold – have concluded negotiations with the authorities in the Democratic Republic of Congo (DRC) on new contracts in terms of the country’s title review process.

In a statement to shareholders here Metorex said that its subsidiary companies had been given final approval by the DRC government regarding the reviews of Ruashi Mining and Miniere de Musoshi et Kinsenda (MMK), after having concluded final agreements with state miners Gécamines and Sodimico.

The DRC government has been reviewing and renegotiating 61 contracts entered into between state mining firms and foreign companies during a civil war in the country between 1998 and 2003.

“Metorex is satisfied with the outcome of this protracted negotiation process,” said managing director Charles Needham. “We now look forward with certainty to the future for the Ruashi Mining project, which boasts a state of the art processing facility,” he added.

Metorex’s subsidiary would now pay a US$4 million (R40 million) mineral content fee payment, in addition to an initial US$3 million (R30 million) mineral content fee it had paid before the review was launched. Gécamines would now hold a 25% stake in Ruashi Mining, compared with the 20% stake it held under the original agreement. Furthermore, the Congolese company would receive a standard 2.5% in royalties on gross revenue on ore treated from stockpiles and open pits at Ruashi.

Metorex was focusing on ramping up production at Ruashi Mining during 2009, while it was undertaking drilling and a prefeasibility study (PFS) at the Musonoi project, which formed part of the Ruashi mining concession. It hoped to complete the PFS within 12 months.

“We are also seeking a suitable financing package for the continued development at Kinsenda mine,” said Needham.