HomeBase MetalsDRC mining contracts still not settled

DRC mining contracts still not settled

Katanga Mining’s
Kamoto concentrator
in the DRC
Lubumbashi, DRC — MININGREVIEW.COM — 04 December 2008 – Gecamines – the state-owned copper mining company of the Democratic Republic of Congo (DRC) – has failed to resolve all the issues in negotiations with international mining companies in a review of the country’s mining contracts.

The Lubumbashi-based company has just submitted a final report to its board, after trying to resolve outstanding issues with the 61 companies involved, CEO Paul Fortin confirmed in a telephone interview with Bloomberg News. “We couldn’t reach 100% agreement,” Fortin said. “There were some issues where there was no budging.”

Gecamines is the largest of six state-owned companies reviewing contracts with private operators in a bid to boost the Congolese government’s share of revenue from the industry. The central African country has a third of the world’s cobalt reserves and 4% of all copper.

Charles Needham – CEO of Metorex, which is one the companies involved – confirmed in a telephone interview with Bloomberg from Johannesburg that talks had been completed, but added that he was unaware of any unresolved issues.

Meanwhile Freeport, McMoRan Copper and Gold – the world’s largest publicly traded copper producer, which has refused to change its contract in the DRC, saying it is fair and equitable – did not participate in the final round of talks, according to Fortin.

“Freeport “chose not to be part of the process,” Fortin said, “so they will have to deal directly with the government.” Freeport spokesman William Collier could not be reached for comment by telephone.

Talks with Katanga Mining – which is re-furbishing the biggest underground copper mine in the DRC – were successful, according to Fortin, who did not give any details. In a telephone interview from London Katanga spokesman Nigel O’Connor said: “our discussions with Gecamines and the government went well, and we are in a strong position.”

The DRC government will make the final decision on the contracts once the Gecamines board has approved Fortin’s report.