Charles Needham, CEO, Metorex
Send this article to a friend
Print this page

» Kipushi awarded by end-January
» Metorex to bid for Kipushi
» Glimmer of hope for Kumba’s Kipushi
» Kipushi venture could get kickstart
» SA refinery to benefit from Adastra deal - Kumba

» JSE:METOREX LIMITED:
510c 0%

Metorex aims for role in Kipushi zinc
Allan Seccombe
Posted: Mon, 19 Feb 2007

[miningmx.com] -- METOREX, the diversified South African mining company, is one of those bidding for the Kipushi zinc project in the Democratic Republic of Congo. It might not win the bid, but there is a chance it could partner the group that does, CEO Charles Needham said on Monday.

Mining at Kipushi was stopped in 1993 when the government of Mobutu Sese Seko ran out of funds. Kipushi’s owner, the state mineral company Gecamines, has invited bids to restart the mine.

Metorex is one of about ten companies that were on the final list for appraisal.

Gecamines is understood to be holding talks with the prospective winner about Kipushi. An announcement is expected within weeks.
we might become involved
“We are not going to be awarded the tender. That’s our understanding,” Needham told Miningmx.

“We have a feeling that party might not have the necessary technical skills, which we could provide,” he added. “We feel that’s how we might become involved in this project.”

“If it is a financier with technical skills we have a problem.”

Metorex up to this point has been unwilling to confirm or deny its participation in the tender process, citing confidentiality rules.

Metorex is hopeful that the group that is selected will bring it in as a technical partner because of its expertise in the zinc industry, ranging from underground mining, processing and concentrating to marketing.

Metorex owned South Africa’s Miranda zinc mine, which it ran for 15 years. It is also building a plant in Zambia to reclaim zinc from oxide and sulphide dumps at Sable. The $5m plant will be commissioned in September and tackle the oxides at first.

There are 415,000 tonnes of oxide material at 10% zinc at Sable and five million tonnes of sulphides at five percent zinc.

The Sable zinc recovery plant would have nothing to do with Kipushi, Needham said. Kipushi would needs its own plant. The mine needs refurbishing and de-watering, he said.

Asked about raising the millions of dollars needed to participate in such a project, Needham said: “This is an absolutely fantastic ore body. We would have no problem at all returning to the market to raise capital for this one. There will be no shortage of investors.”

At the height of production in the late 1980s, Kipushi produced 143,000 tonnes of zinc and 43,000 tonnes of copper.

Click Here to subscribe to our daily newsletter
According to a four-year-old study of Kipushi, the mine has 17 million tonnes of ore, with 2.83 million tonnes of zinc and nearly 400,000 tonnes of copper. The reserves are thought to go down to 1.8km.

However, there is a legal cloud hanging over Kipushi. South African miner Exxaro Resources, formerly Kumba Resources, and Canada’s First Quantum Minerals have instituted urgent legal action in a Belgian court to reinstate their rights to the project.

The final court sitting will be on 23 February, Exxaro’s Douglas Taylor told Miningmx.

It is not known when the court will release a decision on the matter.

The partners have warned other mining companies through newspaper advertisements that it will do all it can to protect its rights to develop Kipushi. Gecamines reckons there had been no agreement reached with the two companies.

The partners already have a court order preventing Gecamines from divulging confidential information and studies that they gathered from work already done at Kipushi.

Gecamines went ahead with the tender for partners at Kipushi and closed the bidding process in October 2006. It is thought to be considering a list of more than 10 companies for Kipushi, with six of those thought to be South African.

Taylor told Bloomberg last week Exxaro was aware of speculation that the tender had already been awarded.

“We’ve sent a letter to the suspected party,” Taylor is quoted by the newswire as saying. “We sincerely hope that Gecamines respects the court date and decision.”