Barrick’s Kibali mine, Democratic Republic of Congo. Image from Rangold Resources.
Democratic Republic of Congo says it loses 60 tons of gold a year to smuggling. The new mines minister wants the country to build new sites to recapture that wealth.
Louis Watum, who became minister last month, previously developed Africa’s biggest gold mine at Kibali, now owned by Barrick Mining Corp. He sees more projects like it on the horizon.
“There’s a lot of talks in the pipeline and a few deals might be announced in the near future,” Watum told Bloomberg in an interview in New York Wednesday. “We are talking with not only existing big mining houses like Barrick. We open again space for newcomers as well.”
Despite the success of Kibali, Congo has struggled to develop gold assets in its conflict-ridden east. Traffickers and armed groups dominate the trade, much of which transits through neighboring Uganda and Rwanda to the United Arab Emirates. With the gold price near record highs, 60 tons of gold could be worth more than $7 billion, a transformative revenue source for a poor country.
Watum, who also developed Ivanhoe Mines Ltd.’s copper and zinc projects in Congo, is in talks with the US over a forthcoming minerals, infrastructure and security deal, which he said are “quite advanced.”
“Once we’ve agreed on that framework, it’s going to be a lot more” business-to-business discussions with US companies, he said. “We’re trying to put as much as we can on the table for them.”
He said he is also looking to resolve longstanding disputes with some of the country’s biggest copper and cobalt miners, including Glencore Plc., Eurasian Resources Group and China’s CMOC Group Ltd.
Earlier this month Watum flew to Kazakhstan with Congolese President Felix Tshisekedi and held talks with ERG, which was in danger of losing at least one of its several projects in the country.
“I don’t think expropriating assets from their operators is a right signal to send to the world,” he said. “They also need to discharge on their obligations, and if they don’t, then we’re going to have also again a conversation to see how we take things forward.”
Watum has also talked to Glencore’s management about outstanding payments, he said.
In response to questions, a Glencore spokesperson said, “We continue to engage with the government.”
Cyrille Mutombo, Barrick’s Congo country manager, said in a message Thursday the company “is ready to invest in future growth in both the north eastern DRC and the copper belt.”
ERG did not immediately respond to messages requesting comment.
Watum said he also has started discussions with CMOC — the world’s biggest cobalt producer — over a new cobalt export quota, and is pushing for development of Congo’s lithium assets with other interested miners.
China’s Zijin Mining Group Co., Australia’s AVZ Minerals Ltd. and the US mining explorer KoBold Metals Co. are all hoping to develop projects in the country.
“When you have an economically viable deposit,” Watum said. “it doesn’t matter who’s going to mine it. It’s going to be mined sooner or later.”
(By Michael J. Kavanagh)
