Randgold’s Bristow warns DRC on code changes

[miningmx.com] – DRASTIC changes to the mining code of the
Democratic Republic of Congo (DRC) would seriously damage returns of Kibali, a gold
mine being developed by Randgold Resources and AngloGold Ashanti.

Mark Bristow, CEO of Randgold Resources, said that the mine – slated as one of the
largest gold mines in Africa when it starts end-2013 – would yield more than 50% of
pretax value in the form of taxes, royalties and dividends to the DRC.

This value excluded jobs created and the businesses that were provided services to
the mine. The mine, which is expected to have a 16-year life, is jointly owned by
AngloGold Ashanti (45%). The government has a 15% stake.

“The DRC state will in fact receive more than the other shareholders who are
financing 100% of the project,’ Bristow said.

“What’s important to note is that the estimates from our feasibility study are based on
the DRC’s current mining code and fiscal parameters. Any drastic changes to these
will have a negative impact on costs, profits and even the life of the mine.’

Bristow was speaking at the DRC’s mining and energy indaba. His comments come
amid planned changes to the mining codes of Cote d’Ivoire, Senegal and Ghana in the
last two months.

Bristow added that African governments across the continent also risked damage to
their economies by trying to squeeze additional revenues out of mining ventures
invested in their countries.

New investment would also be dissuaded from economies where regulatory
uncertainty was the norm.

“I need hardly tell you how damaging that would be to the growth of the DRC and its
economy,’ Bristow said.