adminKinshasa — Despite tumbling commodity prices, Canada’s Ivanhoe Mines says copper production at a new giant deposit in the Democratic Republic of Congo should start in 2018, as it eyes a future deficit in the market and rising global demand.
The discovery at Kamoa in the southeast of the vast mineral-rich country has been presented as one of the biggest finds in copper mining in many years, though DRC is already Africa’s top copper producer and one of the world leaders.
“We think we can begin production at the end of 2018,” Louis Watum, the head of Ivanhoe DRC, told a recent mining conference in Kinshasa. But in the commodities market, mining companies have been struck by a sharp fall in prices, affected by the economic slowdown in top consumer China.
Swiss mining giant Glencore, with a mountain of $30bn in debt, recently suspended production for 18 months in one of DRC’s biggest copper mines.
Watum, however, believes conditions should favour the launch of the Kamoa mine, which lies about 25km west of the major mining town of Kolwezi in the Katanga copper belt.
“Even if China is running out of steam or slowing down today, other countries are still asking for copper. So in the two or three years [to come] we can easily foresee a deficit of copper on the market just as we go into production,” Watum said.
Ivanhoe Mines estimates that the deposit, found in 2007, contains the equivalent of at least 45 million tons of pure copper. The company aims to extract 300,000 tonnes per year once production reaches a peak.
The Canadian firm, which has a 95 percent stake in the Kamoa project, announced in May that it had cut a deal with the Chinese group Zijin Mining to acquire, through a subsidiary, 49.5% of its holdings in exchange for $412m.
Zijin also holds an option to acquire an additional 1.0 percent share upon successfully arranging project financing for 65 percent of the first phase of Kamoa’s development costs.
“This agreement with Zijin, one of the world’s most accomplished miners, is further confirmation of Kamoa’s distinction as one of the most significant, undeveloped mineral discoveries of our age . . . Together with the Congolese government and Zijin, we aim to meet the expectations of the Congolese people and our stakeholders in Katanga as we proceed to build a world-class, new copper mine,” Robert Friedland, Ivanhoe executive chairperson, had said in a statement announcing the deal. Ivanhoe has so far invested approximately $337m in equity capital in discovering and developing the Kamoa project, the statement added.
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