by Ina King (Potgieter) August 21, 2019
The Democratic Republic of Congo holds an estimated $24 trillion in untapped mineral deposits, making it one of the world’s most mineral-rich countries.
In addition to vast quantities of copper, diamonds, coal, tin and gold, the country also holds minerals that will be critical drivers of the Fourth Industrial Revolution, including the world’s largest reserves of cobalt and coltan and an estimated 1 million tons of lithium.
But for all its mineral wealth, large-scale mining only made its introduction into the country with the 2002 establishment of a formalised mining code following years of conflict, social and political upheaval.
The short history of intensive mining in the country, combined with relatively accessible, high-quality deposits and a more stable political environment mean the DRC will be a primary supplier of many of the world’s materials for decades to come.
This is demonstrated by the fact that of the over-100 mining licences granted to companies in the country, only 20 are operational, while over 80 projects are in various stages of exploration or development. Since 2007, the number of mining projects has increased by over 300%.
Almost all of these projects are found in the east half of the country, which includes two large mineral belts, a copper belt in the south of the country, and a large tin region in the very east of the country. Diamonds are found in the southern central region; gold in the north east; and cobalt in the south east.
Mines such as Kibali gold mine (a joint venture between Barrick Gold, AngloGold Ashanti and Congolese parastatal Sokimo); Glencore’s Mutanda copper and cobalt mine; and Katanga copper mine are already amongst the world’s largest, while Ivanhoe Mines’ Kamoa-Kakula project is predicted to become the world’s second largest copper mine once completed.
Other important mining projects include the Tenke Fungurume copper mine in Lualaba Province; Kamoto and Etoile copper-cobalt mines in Katanga Province; and Namoya gold mine in Maniema Province.
As commodity prices continue to recover and the worldwide demand for ‘smart’ commodities such as lithium and cobalt grows, the DRC will likely be one of the world’s top mining destinations into the future.
The 2002 establishment of a mining code included extremely advantageous fiscal incentives to attract foreign investors to the country. A number of revisions to the code are now afoot aimed at extracting more local benefit for the Congolese people.
While the revisions do aim to increase tax and royalties on commodities, these are largely in line with regional standards, and while the industry has relatively high operational expenses, these are offset by the high quality of its minerals, resulting in profitable production costs. In 2013 for example, the production cost of copper in the DRC was $3 672 per tonne, compared with Zambia at $4 582 and South Africa at $4 931.
Much of the mining of the DRC has been achieved by Artisanal and Small-Scale Mining (ASM) operations, which is estimated to provide employment for approximately 12.5 million people in the country. Yet owing to a lack of regulations, support and safety measures, ASM in the DRC is commonly beset by high injury and mortality rates. A mining code that can bring ASM operations under a more formalised regulatory mining framework will not just help increase productivity of mineral extraction, it will also provide better and safer working conditions that will improve the livelihoods of workers.
Government and mining operators are both committed to developing a regulatory framework and partnership initiatives that provide a more formalised long term structure to developing the industry in a fair, sustainable and socially and environmentally responsible way.
You can read more about mining in the DRC here.
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