[miningmx.com] – THE Democratic Republic of Congo (DRC) said it would
consider proposals to raise state participation in mining projects to 35% from 5% and
planned to increase royalties, said Bloomberg News, citing a document handed to it by
a local business association.
The state participation would be a “free carry’ (Government would not pay for it) and
could not be diluted. The aim of the proposals, effectively a re-drafting of the DRC’s
10-year-old mining code, was an attempt to lift the mining industry’s contribution to
the DRC’s economy to 25% by 2016 from the current 10%, Bloomberg News said.
Companies potentially affected by the change in mining code would be Randgold
Resources and AngloGold Ashanti, which are building a gold mine in the country and
conducting exploration activity. Glencore, Minmetals and Freeport McMoRan Copper &
Gold would also be affected.
Another company, Banro, which is building a gold mine in the DRC, said it had an
agreement with the government that was a convention and therefore exempt from
changes to mining law.
“These proposals will be submitted to all parties for a consensus,’ mines minister
Martin Kabwelulu told Bloomberg News in a mobile phone message. The report was
handed to Bloomberg News by a business association called FEC.
The proposed changes to the mining law explain comments by Mark Bristow, CEO of
Randgold Resources, who said on October 16 that “increasing the tax burden on those
who had taken the risk of investing in the DRC would not only damage the country’s
fledgling mining industry, it would also discourage future investors from developing
new operations’.
