DRC's Katanga governor woos bona fide resources investors, heaps praise on Nikanor

26th February 2007 By: Martin Creamer - Creamer Media Editor

Katanga governor-elect Moise Katumbi has extended an invitation to South African resources investors to help him return the once-rich Democratic Republic of Congo (DRC) mining province to its former glory.

Speaking at a Nikanor signing ceremony to mark the start of work on a large new copper refinery, Katumbi heaped praise on the London Alternative Investment Market (Aim)-listed Nikanor for investing in the province that once contributed 70% to overall DRC coffers.

A businessman-turned-politician, Katumbi said that Nikanor had been true to its word in its dealings in the Katanga province and he would be insisting upon that from all investors.

A $30-million earthworks contract between Nikanor's DCP subsidiary and Mining Company Katanga (MCK), headed by South African Kenneth MacLeod, was signed, for a 250 000 ton per annum (tpa)-to-400 000tpa state-of-the-art solvent-extraction-electrowinning refinery, which may eventually also toll-treat material for others in the region. MCK has procured a band new truck fleet for the earhtmoving assignment from South Africa's Bell Equipment.

Primary use, however, will be for Nikanor's own Kamoto-Oliveira-Virgule (KOV) operation and its other assets in Kolwezi.

Katumbi praised a corporate social road-rehabilitation investment that Nikanor had already undertaken in Katanga, which meant that Katangans could now drive to Kolwezi in a matter of hours rather than days.

Nikanor, headed by executive chairperson Jonathan Leslie - known in South Africa as the former CEO of Sappi - is investing $1,3-billion in KOV, which is one of the world's largest high-quality copper-cobalt orebodies.

Katumbi extended an invitation to South African resources investors to “come and invest in Katanga”, which he was intent on substantially developing. Besides mining, he also saw attractive tourism potential in some of the province's best-kept tourism secrets, including a spectacular waterfall, which he believed rivalled the Victoria Falls.

The charismatic governor-elect, who won by an overwhelming landslide, is also closely connected to Katanga's popular CAF-cup soccer team, TP Mazembe.

Katumbi was scathing about companies that had made grandiose investment promises, but had then failed to deliver on those promises.

He was particularly critical of Exxaro Resources' failure to develop the Kipushi zinc mine and said a contract to do so had now been awarded to United Resources.

He held up Nikanor as a model investor and said that the refinery it was building would be of great value-adding benefit to the province of Katanga, which he believed had enormous promise as an investment destination.

He said that he hoped one day to be able to develop Katanga to a height that would make it comparable with South Africa.

Nikanor is already processing cobalt-rich ore from satellite Kananga and Tilwezembe operations and exporting it through Durban, which is some 3 000 km away.

Steps are being taken to improve rail facilities to closer ports and Lobito, being 1 800 km away in Angola, is one being considered.

It was understood that China would be paying for the upgrade of the line to the DRC border, with Nikanor also assisting for a stretch of rail line.

Nikanor last year raised $434-million on London's Aim. Twenty-eight percent of its shares are in free float, 36% are held by BSGR (Beny Steinmetz Group Resources), which is known in South Africa for its control of project house Bateman, and also for its significant diamond interests, 22% by the Gertner Family Trust and 14% by Dan Gertler.