Engineering & Mining Journal

JUL 2018

Engineering and Mining Journal - Whether the market is copper, gold, nickel, iron ore, lead/zinc, PGM, diamonds or other commodities, E&MJ takes the lead in projecting trends, following development and reporting on the most efficient operating pr

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Page 59 of 75

DRC UPDATE 58 E&MJ • JULY 2018 Some of the larger miners have assist- ed in laying down logistics routes. Cana- dian firm Ivanhoe said last year it would rebuild 34 kilometers (km) of track to con- nect the Kipushi copper mine with the DRC national railway at Munama, south of Lubumbashi. "We need rail infrastructure, because you can't move 550 [metric tons] a day of copper by road," said Louis Wa- tun, DRC country manager for Ivanhoe. "There's an ocean of copper here waiting to be exported." The government is now getting serious in its push for downstream value added to export minerals. Last year, it halted un- processed copper and cobalt exports from a $3.2 billion mining venture operated by Chinese company Sicomines. The mine accounted for about a quarter of copper concentrate and 5% of copper-cathode exports from the DRC. "There is no longer the export of any raw, unprocessed minerals. It is all pro- cessed here," Masangu Mulongo said. Of all the DRC has to offer, cobalt is now the mineral of the hour. Brokerage firm UBS said in a note to clients last month that at least 90,000 mt of addi- tional cobalt will be needed by 2025 to meet demand. The forecast was based on expecta- tions that electric vehicle penetration will grow to 16% globally, up from about 1% currently. Demand and supply were in balance at about 100,000 mt in 2017, UBS said, projecting an oversup- ply for several years turning to a deficit in the mid-2020s. Demand growth has caused a spike in cobalt prices to more than $85,000/mt, up from about $22,000/mt in February 2016. According to Benchmark Minerals in London, cobalt could reach $180,000/ mt by 2025. The DRC has also had to overcome the "blood mineral" label, the association of its diamonds, gold and other metals with warlords and strife. International media campaigns had created the perception the country's minerals were all the products of slavery and merchants of war. However, in recent years, U.N. peacekeepers together with the local military had brought illicit op- erators largely under control, said Didier Julienne, an industrial strategist based in the capital, Kinshasa. "Blood minerals are a thing of the past," Julienne said. "Military interven- tion has seen to it that the problem is now minimal. Blood minerals from the DRC should no longer be of concern to the consumer." Rebels still operate in parts of the coun- try, especially the eastern provinces. A large contingent of U.N. troops are deployed and are helping bring stability to the region. Politically, President Joseph Kabila's legal term ended in 2016. Elections have been continually delayed, exacerbat- The Katanga Business Meeting discussed at length the issues around a contentious set of mining laws that will raise taxes and royalties. Indemic poverty and pressing infrastructure needs prompted the Congolese government to raise mining taxes and royalties.

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