Some 25 mining contracts in Congo involving â€œsecond tierâ€ copper, diamond, and gold assets could be scrapped if companies fail to present the results of feasibility studies by a December dealine, the Ministry of Mines said on Thursda
Some 25 mining contracts in Congo involving â€œsecond tierâ€ copper, diamond, and gold assets could be scrapped if companies fail to present the results of feasibility studies by a December dealine, the Ministry of Mines said on Thursday.
â€œWe will see if the studies were done. They will be able to present their reasons, and the cabinet will decide whether to extend (the deadline) or withdraw the permits.
â€œThe goal is to have these assets in capable hands,â€ Deputy Mines Minister Victor Kasongo, said.
Congo completed a review of 61 mining contracts in August as part of an effort to boost state revenues from agreements signed mostly during the chaos and corruption of a 1998-2003 war and the transitional government that followed.
However, many companies that saw their partnerships approved by the review panel have yet to present required feasibility study results, Mines Minister Martin Kabwelulu told an investor conference in Kinshasa last week.
â€œCertain partners started work without finalising their feasibility studies,â€ he said.
The companies were initially asked to present the results among documents submitted at the start of the long-delayed review process.
But the government extended the deadline when it became clear that the majority of companies had not yet completed their studies. â€œEleven companies were either in production or gave feasibility studies.
â€œThe rest gave nothing. So far weâ€™ve still received nothing, and weâ€™ve asked,â€ Kasongo said last week.
He said around 25 projects in possession of what he described as â€œsecond tier assetsâ€ in the copper, diamond, and gold sectors were subject to the December deadline.
He did not name the projects. Congo cancelled a copper and cobalt mining contract with Kingamyambo Musonoi Tailings, a unit of First Quantum in August on the grounds that it had failed to enter into commercial production within an agreed timeframe.
Freeport McMoran and Lundin Mining, parnters in the giant Tenke Fungurume Mining copper and cobalt project, were given until today to complete negotiations with the government or risk losing their permit.
Analysts expect the completion of the review to boost investor confidence in Congoâ€™s lucrative mining sector.
25 Congo mining deals risk cancellation