TORONTO (miningweekly.com) – TSX- and Aim-listed Moto Goldmines said on Wednesday that the Democratic Republic of Congo (DRC) has finished a review and renegotiation of its mining contract, and that the company will retain its 70% stake in the Moto gold project.
A government-owned company, L'Office des Mines d'or de Kilo-Moto (Okimo), will continue to hold the balance, Moto said.
According to the agreement, Okimo will receive a nondilutable 30% holding in Moto's local subsidiary, Borgakim Mining, which will become the joint-venture owner of the project.
The meetings with Okimo were held in the presence of experts appointed by the DRC Minister of Mines, and the agreements reached have been approved by Okimo's board and the Minister.
The DRC began a review in 2007 of 61 mining contracts, most of which were entered into during the country's 1998 to 2003 civil war and the subsequent transition period.
The government said late in December that it had completed the review, and renegotiated contracts where necessary, for all but six of the mining companies concerned.
“With the conclusion of the renegotiation of our arrangements with Okimo, we are now able to proceed with the development of the Moto gold project for the benefit of all stakeholders,” commented Moto Gold Mines chairperson Sam Jonah.
“The company looks forward to the ongoing support of the DRC government."
Meanwhile, Moto also reported on Wednesday that it had reconfigured the project into an openpit and underground mining complex, from a previously openpit-only plan.
The firm expects to publish an optimised feasibility study, which will emphasise improved grades, along with a lower throughput rate, by the end of this month.
An initial feasibility study, completed in December 2007, had indicated the viability of building a 400 000-oz/y openpit gold mine, at a cost of $483-million.
Moto shares gained 6,3% on Wednesday, to C$2,20 apiece by 15:45 in Toronto.