Kinshasa - Gecamines, the state-owned mining company of the Democratic Republic of Congo (DRC), might take action against some of its partners after an audit of its joint ventures showed the company had been treated unfairly, chairman Albert Yuma said last week.
Yuma declined to identify the companies that Gecamines is considering action against.
Its partners include Swiss-based Glencore Xstrata and US-based Freeport McMoRan Copper & Gold.
“We’re having lawyers look at the report and are hoping that in all cases there will be discussions with our partners,” he said.
“In cases where we are not convinced that our partners were very fair to Gecamines, there will be action.”
Two weeks ago Gecamines received the results of an audit it announced two years ago as part of a plan to revitalise the Lubumbashi-based company.
The company’s copper output almost stopped in the early 2000s after decades of mismanagement and war. Gecamines was previously one of the world’s biggest copper producers, producing 476 000 tons in 1986. The DRC’s copper output reached more than 600 000 tons last year, most of it from Gecamines’ joint ventures.
Yuma said Gecamines had struggled to attract financing for its fully owned properties because of outdated equipment and a debt burden of nearly $1 billion (R10bn). The firm had prepared a new reorganisation plan, which would require about $2bn in financing for new plants and about $750 million for a coal-fired power plant to overcome power blackouts.
Gecamines would spin off its minority shareholdings into a separate offshore company, using the cash flow generated from royalties and dividends to attract investment, Yuma said. It might also sell its 20 percent stake in Glencore’s Kamoto Copper, one of the DRC’s biggest mines. – Bloomberg