Ann: Suspension from Official Quotation, page-9

I wonder if this development may have caused some to forsee a negative effect on NZC SP? Though local processing seems to be more and more the thing in developing countries, of course, particularly Indonesia, Philippines, Tanzania, etc

http://www.miningweekly.com/article...pper-exports-orders-local-refining-2017-10-09

Congo halts Sicomines' copper exports, orders local refining


9TH OCTOBER 2017

BY: BLOOMBERG




KINSHASA – The Democratic Republic of Congo ordered Sinohydro Corp. and China Railway Construction Corp.’s local mining venture to stop exporting unprocessed copper and cobalt and refine all its metals within the country.
Sicomines must ship “only high-value products” as the government looks to “ensure the prompt repayment” of the country’s continuing $6-billion minerals-for-infrastructure deal with China, Mines Minister Martin Kabwelulu said October 2 in response to questions sent by text message.Sicomines’ profit is paying off the loans China provides toCongo, which will be reimbursed quicker if the mine exports higher value, refined metals.
The $3.2-billion mining project operated by Sicomines accounted for about a quarter of copper-concentrate and 5% of copper-cathode exports last year from Congo, Africa’s biggest producer of the metal and the world’s largest source of cobalt. Sicomines exported 115 000 metric tons of copper concentrate and 20 000 tons of copper cathodes in the first half of 2017, according to the Provincial Division of Mines in South Katanga, where the mine is situated.
Sinohydro Corp. and China Railway Construction, both based in Beijing, own 68% of Sicomines. The project is a key part of a minerals-for-infrastructure deal struck between the two countries in 2007, under which the Chinese companies build infrastructure including roads and hospitals that are financed by Chinese banks in return for metals like copper and cobalt.

AUTHORISATION WITHDRAWN
Kabwelulu wrote to Sicomines Director-General Sun Ruiwen saying he disapproved of the type of mining products the company is exporting, according to a Sept. 11 letter seen by Bloomberg and confirmed by the minister. The minister said the bulk of the products exported by Sicomines are unrefined copper concentrate and cobalt hydroxide, not processed copper cathodes and cobalt metal

Local mining authorities had been instructed to “no longer authorize the export of mining products other than” processed copper and cobalt, Kabwelulu said in his letter. Of 112 trucks ferrying exports of the metals, only 44 were allowed to proceed because they were already at the border, he said in a text message. Sicomines, whose Congolese shareholders include State-owned miner Gecamines, transports its products by road to neighbouring Zambia.
Sicomines Deputy Director-General Jean Nzeng said the company responded to the minister’s letter.
“We’re in contact with the ministry to unblock the situation,” he said by phone Oct. 4 from Kinshasa, the capital. “There are no major problems.”
Copper Output

An April 2008 convention that led to the creation of Sicomines states that the venture must produce 200 000 tons of copper cathodes annually by the end of its first year of commercial production and “a corresponding tonnage” of processed cobalt, which is obtained as a by-product of copper mining. Output should rise to 400 000 tons of refined copper in the third year of production, according to the agreement.
Sicomines began production in November 2015 and last year produced 44 000 tons of copper cathodes.
“Sicomines must respect the convention,” Kabwelulu said by text message. The company didn’t respond to questions about why it officially exported no cobalt in 2016 or the first half of 2017.

Moise Ekanga, the head of the Congolese department monitoring the project, said in an interview in October 2015 that a lack of available power was preventing Sicomines from working at full capacity and that the company needed an extra 170 megawatts. Sinohydro and China Railway are currently financing a 240-megawatt, $660-million hydropower plant to meet Sicomines’ needs. In a 2015 press release, the monitoring office, which is under the control of the presidency, said that Sicomines’ copper output would “gradually” rise to 400 000 tons “over the next two decades.”
Ekanga didn’t respond to phone calls, text messages and an email seeking comment.

EXPORT BAN
Congo ordered a ban on the export of copper and cobalt concentrate in 2013, but has delayed its implementation on several occasions because the country doesn’t produce enough electricity to process the products domestically. Most major producers other than Sicomines, such as Glencore andChina Molybdenum, already process their copper inside Congo.
Congo’s largest cobalt producers -- Tenke Fungurume Mining, which is 56% held by China Molybdenum Co. andGlencore-owned Mutanda Mining -- export cobalt hydroxide rather than cobalt metal, according to government data. Sicomines only began exporting cobalt hydroxide in June, the data shows.
Kabwelulu asked Sicomines to provide “ample clarifications” about its lack of cobalt shipments during its first 18 months of production despite the fact that its “mining perimeter contains cobalt minerals,” according to a second letter sent to Sicomines’ director-general on Oct. 2. The letter, seen by Bloomberg, was confirmed by Kabwelulu’s cabinet director,Valery Mukasa.
Congo expects to produce 1.05-million tons of copper this year, up from 1.02-million tons in 2016 and a record 1.03-million tons in 2014. Cobalt output is forecast to grow 22% to 16 619 tonnes.

***************Hopefully the larger project may be more exposed to the local processing requirement than will be the smaller NZC project. Also the particular financing and construction nature of this agreement may ensure more rigorous enforcement than NYC might encounter. Who knows.

Regards to all.