Perhaps this bit of news had something to do with the rise in Canada?
All the best.
KKR
DRC sacks Gecamines top management ? officials
Source: Reuters Published: 22nd November 2010
KINSHASA ? Democratic Republic of Congo has replaced the leadership of state mining company Gecamines due to management deficiencies and its failure to make the most of rising metals prices, officials said on Monday.
Nine officials were sacked at the weekend in a shake-up ordered by President Joseph Kabila, according to officials at the mines ministry and the office of the prime minister.
"The old management team lacked -- despite many years -- the initiative to increase production despite favourable prices of copper/cobalt, and (failed due to) bad management of partnerships," Mines Minister Martin Kabwelulu told Reuters by text message.
Kabwelulu said Ahmed Kalej, previously treasury director at the central bank, has replaced Callixte Mukasa as director of Gecamines, which mainly mines copper and cobalt in Katanga.
Albert Yuma, head of the country's business federation FEC, will become president of the board, while Jacques Kamenga will deputise for Kalej, officials at the mines ministry said.
Six other administrators have also been changed.
Copper production in Congo is believed to be rising but official estimates of output vary widely.
Mines ministry forecasts from earlier this year saw production in 2011 from the Katanga region at 516,000 tonnes, mainly due to joint ventures with international firms, but Katanga governor Moise Katumbi told Reuters last week the figure would top one million tonnes next year.
But despite joint ventures in 30 projects with private international companies at the end of 2009 in some of the world's most lucrative mining operations throughout Katanga, Gecamines has been saddled with debt, low revenues and a fall in its own output under the old management team.
"The priority has to be to kick-start production - that's the main thing," Kalej told Reuters by telephone on Monday.
"We also need to continue exploration and really invest in production facilities -- it's certainly down to finding finance, but also in the quality of spending," Kalej added.
DECLINING FORTUNES
At its peak in the late 1980s, Gecamines produced more than 470 000 t of copper and more than 13 000 t of cobalt. But the decline in the company's fortunes mirrored those of the country, which saw rampant corruption under the late president Mobutu Sese Seko, followed by two wars in the 1990s.
A peace deal in 2003, elections in 2006 and high metals prices have seen mining firms return to Katanga but Gecamines' share of business remains low following a world collapse of prices after the 2008-2009 financial and economic crisis.
Leaving aside production from joint ventures copper and cobalt output were 13 367 and 495 t, respectively, in 2009, according to the firm's 2009 annual report, which cited delays in revamping equipment.
Outgoing Gecamines director Mukasa told Reuters last week that Gecamines has accumulated $1,5-billion in debt following years of mismanagement under Mobutu.
Of that, he said the company owed more than $300-million in unpaid salaries and worker dues, $300 million for national power company SNEL and more than $300-million on unpaid taxes.
Gecamines succeeded in increasing its share in projects during a protracted mining contract review process, including a 2,5% share increase in the $2-billion Tenke Fungurume project with Freeport-McMoRan Copper & Gold.
Mukasa said Gecamines's revenues for 2010 were likely to run to only $250-million but that the budget had not been finalised.
INTERVIEW-Congo copper output to rise 25 pct next year 725 words 17 November 2010 Source: Reuters Limited
* Copper exports seen over 1 million tonnes in 2011
* Investment rising since end of contract review
By Katrina Manson
LUBUMBASHI, Democratic Republic of Congo, Nov 17 (Reuters) - Exports from Congo's southern copperlands will rise 25 percent to over 1 million tonnes next year due to renewed investor confidence following a government mining contract review, the top official in the province told Reuters.
Moise Katumbi, governor of Katanga Province, said companies and their backers were boosting spending following the conclusion of the review last month, which resulted in Freeport-McMoRan Copper & Gold's conceding a small share of its huge Tenke Fungurume copper project to the state.
The deal ended years of uncertainty in Congo's mining sector, and analysts widely viewed the outcome as positive for the company, which retained the bulk of its controlling interest in the project.
"After Tenke got its revisitation, even the people who had a bit of fear are putting in money. Everyone is financing now, even the banks," Katumbi said.
Katanga, Congo's sole copper-producing region and source of about 5 percent of the world's supply of the metal, is on track to produce 800,000 tonnes this year, he said.
"There are plenty, plenty projects," Katumbi added. "End of next year we are going to reach 1 million tonnes. In five years' time we are going to reach 1.5 million," he said.
Exports in 2011 will include 700,000 tonnes of metal and 300,000 tonnes of concentrate, he said.
The forecast far exceeds a projection from the mines ministry earlier this year showing copper exports would reach just over 516,000 tonnes in 2011 -- a figure Katumbi said is now out of date due to new estimates from firms.
Valery Mukasa, chief of staff in the mines ministry, could not confirm Katumbi's figures but said data were being reviewed as forecasts were constantly being raised by companies.
Katumbi said Katanga Mining and Mutanda Mining, both part-owned by Swiss metals trader Glencore [GLEN.UL], along with China's CDM, South African Metorex's Musoshi project and Anvil Mining , part-owned by metals trader Trafigura, would together pump $2.2 billion to expand their projects throughout the province.
Perceived contract insecurity prompted political risk premiums in Congo to rise 40 percent after the state withdrew the rights to Canadian miner First Quantum's $750 million KMT project in Kolwezi last year and handed them to Kazakh rival ENRC in August.
EXPORT METALS TARGET
Katumbi said he wanted investors to focus on developing agriculture, health services and tourism in the sunny and mineral-rich province, the wealthiest in the country. He said Katanga would this year contribute 60 percent of receipts to the national treasury, up from 45 percent.
Katumbi said that although provinces are meant to receive 40 percent of receipts back from the central state, Katanga receives less than 10 percent, a shortfall he makes up in part by levying provincial road tolls and minerals fees that elicit protests from investors.
Earlier this year, Katumbi introduced a controversial $60-a-tonne tax on mineral concentrates in an effort to encourage companies to add more value in the country.
"The time I came here, people were just exporting unprocessed material and concentrate, and nobody wanted to build a factory. Concentrates were almost 95 percent (of exports); today it is 30 percent," he said.
"Sixty dollars on the concentrates is nothing. In Zambia they are paying 15 percent on the export of concentrates," he said. "My aim was to stop the concentrates this year. Before I leave this office, people must export metals."
Copper prices have dropped to as low as $7,920 a tonne this week after hitting a record high of $8,966 last week.
Katumbi, who is also chairman of TP Mazembe football club which beat Tunisia to take the African Champions League trophy at the weekend, says he will step down as governor next year after only one term to pursue his own business interests.
"Politics is taking me a lot of time and creating enemies for nothing," he said. (Editing by Richard Valdmanis and Jane Baird)
AVM Price at posting:
$5.30 Sentiment: Buy Disclosure: Held
