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Gold/Mining/Energy : Copper - analysis -- Ignore unavailable to you. Want to Upgrade?

To: Stephen O who wrote (1968)	2/10/2009 11:14:35 AM
From: Stephen O	Read Replies (1) \| Respond to of 2131

Mining Majors to Join Congo Copper Exploration, Gecamines Says 2009-02-10 12:30:20.450 GMT By Franz Wild Feb. 10 (Bloomberg) -- Gecamines, the Democratic Republic of Congo’s state-owned copper miner, will this year start exploration in the southern Katanga province with international mining companies, Chief Executive Officer Paul Fortin said. Bids for up to six projects have been received from international miners, which may lead to joint-ventures with Gecamines, Fortin said today by phone from Cape Town, where he’s attending the Mining Indaba conference. “We’re getting some great entries,” he said. “We’re getting heavyweights interested who are looking for big resources and cheap resources.” While he declined to name the companies, he said they are “willing to expend some funds.” Congo’s copper belt holds a third of the world’s cobalt reserves, and the country is relying on output from new mines to inject cash into its growing economy. A group of Chinese state-owned companies has promised infrastructure and mining investments worth about $9 billion in exchange for control of 10 million metric tons of copper and 600,000 tons of cobalt. This deal will not change in value, even though commodities prices have fallen as a result of the global financial crisis, Fortin said. “Over the life of the project, we may have several cycles,” he said. “We can’t adjust it every time.” ‘Deal is Robust’ The final value of the deal will only be determined after a feasibility study has been completed, Deputy Mines Minister Victor Kasongo said by phone from Cape Town. “The deal will remain robust as long as we’re waiting for the feasibility study.” The International Monetary Fund last year said Congo would not qualify for more than $6 billion of debt relief until it was clear the Chinese loan would not be guaranteed by the government and thus encumber the country with further debt. Mineral production from the Katanga province has slumped as global metal prices tumbled along with demand last year. About 45 of Katanga’s 75 copper and cobalt processing facilities have halted production, according to the province’s mines ministry. Approximately 300,000 workers, mainly independent miners, who dig ore with pick axes and spades and then sell it to trading houses, lost their jobs last year, the ministry said. Gecamines, based in Lubumbashi, expects the Chinese group to make a $250-million loan payment, part of the infrastructure agreement, “shortly,” Fortin said. The company currently has debt of $2.1 billion. “Gecamines is holding on, but it’s very, very tough,” Fortin said. “We have more unpaid bills than we had. We have more financial difficulties - it was behind, but it looks like it’s also in front of us.”