afrol News, 14 January - The Kinshasa has now approved operations at the Kolwezi Tailings Project, a mining project in Congo's southern Katanga province that is set to produce large quantities of cobalt and copper at low prices. A London-based company holds the rights to re-treat the waste materials.
America Mineral Fields (AMF) today announced that the Council of Ministers of the government of Congo Kinshasa (DRC) had approved the Kolwezi Tailings Project at a cabinet meeting held on Friday. The Kolwezi Tailings Project is situated 25 kilometres outside the Katanga town of Kolwezi.
The project involves the re-treatment of processed oxide tailings - a waste material - produced by the mineral concentrator facility in Kolwezi, which processed high-grade ore from the Kov and other nearby mines from 1952 onwards. Due to the poor recoveries obtained from conventional concentrating techniques, valuable amounts of copper and cobalt were discharged into two tailings dams, referred to as Kingamyambo and Musonoi.
The Kolwezi Project consists of two dams containing 112.8 million tonnes of oxide tailings, grading 1.49 percent copper and 0.32 percent cobalt, as determined by Geostokos Limited. "This resource has the potential to host one of the world's largest and lowest cost cobalt producers," according to a statement by AMF.
At a conceptual annual output of 42,000 tonnes of copper and 7,000 tonnes of cobalt, the project would have an operating life of 38 years, the UK mining company holds. "Such a project would generate significant tax and foreign exchange earnings, as well as providing local employment and contributing to the revival of the DRC's copper belt infrastructure," says AMF.
The Congolese government approval given on Friday is however subject to the official presentation of the Contract of Association in its final form to the Council and the incorporation of Kingamyambo Musonoi Tailings SARL, the Congolese operating company that will hold the Tailings Exploitation Permit.
- This is another important step forward in the completion of the Kolwezi transaction and a strong reaffirmation of Congolese governmental support for this important project, commented Tim Read, President of America Mineral Fields. "The way is now clear to complete the final stages of both the feasibility study and the Environmental and Social Impact Assessment, and to seek financing for this world class project."
On 17 November last year, AMF had announced that the Kolwezi Contract of Association had been agreed and initialled by AMF, the Kinshasa government and La Generale des Carrieres et des Mines ("Gecamines"), the state-owned mining company. At that moment, however, a formal approval by the Congolese government and the boards of AMF and Gecamines was still needed.
- These three approvals have been received and the contract will now be formally executed, today's AMF statement says. "As part of this process, Kingamyambo Musonoi Tailings (KMT) will be incorporated and exploitation rights to the tailings will be transferred to it. This whole process is expected to take several weeks," the UK company adds.
Congo Mineral Developments, AMF's 100 percent owned subsidiary will own 82.5 percent of KMT, with Gecamines and the Congolese government owning 12.5 percent and 5 percent respectively.
- Two payments totalling US$ 15 million will be made by KMT to Gecamines as consideration for the tailings and the rights to exploit them, according to AMF. "The first instalment of US$ 5 million will be made at the time of the transfer of the mining rights and the second instalment of US$ 10 million will be made following the completion of the bankable feasibility study, at the time of the closing of the project financing.
In addition, the Congolese parastatal Gecamines was to be entitled to a further profit participation "in circumstances of an elevated cobalt price," AMF says. KMT's initial payment to Gecamines will be financed by a shareholder loan from AMF's subsidiary, Congo Mineral Developments.
America Mineral Fields is an international mining company listed on the Toronto Stock Exchange. The company is currently developing several mineral assets in Central Africa, including the Kolwezi cobalt/copper tailings project, the company's flagship.
Further, AMF is involved in the Kipushi high grade zinc and copper mine in Congo Kinshasa - also placed in Congo's mineral rich Katanga province - the Solwezi prospecting licence in Zambia's Copperbelt region and the Cuango River diamond project in Angola, close to the Congolese border.
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