Listed Mining Companies
13th July 2007
TEXT SIZE
The Katanga province will not allow unprocessed metals and minerals to leave its borders, and the Ministry of Mines has stepped in to prevent the DRC from being saddled with anyone that has a black mark next to his name.
At least one listed company is in discussion with the DRC government over an alleged unethical business practice outside of the DRC, and charismatic Katanga governor Moise Katumbi has made no bones about his ambitions for his reviving province.
But squabbles are continuing to spill over into the public domain. One of these has involved Billy Rautenbach, who once headed automotive and logistics businesses in South Africa before leaving suddenly without prior warning. Rautenbach is now involved with the London Alternative Investment Market- (Aim-) listed Central African Mining & Exploration Company (Camec).
A DRC Ministry of Mines spokesperson was publicly critical of the Rautenbach-Camec link, to which Camec responded by outlining its ‘significant contribution’ to the DRC following its $150-million investment in the Luita copper/cobalt metallurgical facility in the Katanga province of the country.
The facility and all associated activities, which Camec says now employs in excess of 3 000 people, are 20% owned by G�camines, the DRC’s State-owned mining company.
Camec says that the Luita facility is currently producing copper cathode and cobalt concentrate that is generating significant taxable revenue for the DRC. The company says it has always adhered to international corporate governance standards and believes the allegations levelled against it to be unfounded.
Camec claims that the allegations originated from commercial disputes concerning Camec’s 50%-owned Mukondo concession area and its acquisition of shares in Katanga Mining, a mining company based in Canada.
Camec has been exerting con- siderable pressure to restart mining as it develops its activities in the Katanga province and expands its investment and development programme.
Controversies such as this have arisen as a consequence of many DRC mining deals having been negotiated during the six-year war or the subsequent three-year transition, which saw rebel groups and government loyalists govern the country in the run-up to the elections. Many of those contracts have come under heavy criticism both in the DRC and abroad.
Because the DRC is so mineral rich, there is a suspicion that some criticism is stemming from opponents wanting to gain assets held by others.
In August 2006, Gecamines invited international tenders for other investors to mine Kiphusi, saying that the companies “had been there for many years without doing anything”. Consequently, the two companies in question, Exxaro and First Quantum, initiated emergency Belgian court proceedings against Gecamines on the grounds that the tender was in breach of the existing exclusive contractual arrangement, and won its case.
Since then there has been no clarity on whether or not the two companies will continue to be involved at Kiphusi; the contractors to the concession have not been decided yet.
Meanwhile, Aim-listed Nikanor has been praised by Katumbi, and its investment held up as a model for other companies to follow.
A $30-million earthworks contract between Nikanor’s DCP sub- sidiary and Mining Company Katanga (MCK), headed by South African Kenneth MacLeod, was signed, for a 250 000-t/y to 400 000-t/y state- of-the-art solvent-extraction electro-winning refinery, which may eventually also toll-treat material for others in the region.
Katumbi also praised a corporate social road-rehabilitation investment that Nikanor had already undertaken in Katanga. The road means that Katangans could now drive to Kolwezi in a matter of hours rather than days. Government comments following the successful democratic outcome in DRC all point to a demand for greater reciprocity from mining companies operating in a country that many regard as “the prettiest mining girl on the block”.
.gif)
