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DRC warns mining companies
David McKay
Posted: Fri, 23 Feb 2007

[miningmx.com] -- THE Democratic Republic of Congo's government will revoke companies' right to mine properties if they fail to meet state deadlines, Moise Katumbi, the governor of the mineral-rich Katanga province, said on Friday.

"Those people that don't honour their promises, we are going to take them (mining permits) back," Katumbi said.

The Katanga province generates an estimated 70% of the DRC's economy. It contains most of the country's base metals wealth.

Katumbi's comments follow a dispute between South Africa's Exxaro Resources and Canada's First Quantum Minerals and Gecamines, the DRC's state-owned mining company.

Exxaro and First Quantum are suing the DRC government after losing the right to mine the Kipushi zinc mine in Katanga province. The project has been put out to international tender and a winner is expected to be announced soon.

Katumbi said Gecamines had over five years attempted to contact Exxaro and First Quantum. "Now the price of zinc is high, they want to develop the mine."

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"They are criminal, these people," says Katumbi. "How many times Gecamines tried to contact them?"

Exxaro CEO Con Fauconnier said he was philosophical regarding a dispute with Gecamines. “If we can’t do business on our terms, we’ll take our money elsewhere,” he said on Thursday.

Exxaro Resources and its joint venture partner, Canada’s First Quantum Minerals, claim to have an agreement to develop Kipushi. Exxaro also has a claim to develop another mine known as Kamoto. Both agreements date from the 1990s.

However, Paul Fortin, CEO of Gecamines, said in an interview with Miningmx on February 10 he was convinced by legal advice claiming no such agreement existed. “I will see them in court,” he said.

Kipushi, is estimated by Bloomberg News to contain 16.9 million tonnes of ore containing 2.8 million tonnes of zinc and a further 392,755 tonnes of copper. Bloomberg News said the ore was worth $11bn according to metal prices on February 13.