Gecamines seeking to shake up Congo’s joint venture agreements

THE Democratic Republic of Congo (DRC) is seeking to get more copper production from joint ventures it’s involved in as well as secure offtake contracts so it can trade the metal.

Citing Guy Robert Lumaka, chairperson of state-owned mining company Gecamines, Reuters reported that it the DRC also wants more local executives on boards governing joint ventures.

“We want to repair a certain stage of mistakes that were made when they asked us to give most of our best assets to third parties just to attract foreign direct investment,” said Lumaka. The plans may mean overhauling some terms of agreements that Gecamines considers unfavourable, the newswire said.

At its peak in 1986, Gecamines miner produced more than 490,000 tons of copper and cobalt, said Reuters. The DRC is also the world’s third largest cobalt producer.

Reuters said the DRC’s plan may be pointed towards certain Chinese companies which have been key to reviving copper and cobalt production in the DRC. It also cited comments by the recently re-elected president Felix Tshisekedi as saying some deals were skewed heavily in favour of Chinese companies.

Board representation would ensure accountability and transparency as well as community development and compliance with rules on local procurement and training of local staff, Lumaka is quoted to have said.

Some mines aren’t expanding output citing indebtedness which had the effect of depriving the state to profits. Lumaka asked why some of its partners are reporting losses and scaling down production because of a slump in cobalt’s value, especially as copper prices have been elevated.

“We can no longer accept this level of debt while people don’t put capital into the assets,” Lumaka said. “We are not sleeping partners in our own country. We should be part of the governance.”