ANVIL Mining's Dikulushi copper and cobalt mine in the Democratic Republic of Congo is under threat, with reports surfacing that a mining commission review has recommended the company's mining contract be cancelled.
Copper concentrate from Anvil Mining's African operations.
According to a preliminary report seen by Reuters, the commission has recommended 24 out of 61 mining contracts be terminated and the remaining 37 contracts be negotiated.
Among the mining contracts recommended for cancellation is Anvil's Dikulushi underground mine. The review is reported to say the operation earns nothing for the state and "proposes the Government end it".
Report of the possible termination of the company's mining contract prompted investors to sell shares in Anvil, with the share price on the local bourse dropping some 15% to an intraday low of $17.80 on no news, while on the Toronto Stock Exchange - where Anvil is also listed - shares closed down 6.6% to $17.43 on Friday.
MiningNews.net was unable to contact Anvil managing director Bill Turner at time of writing.
At last glance, shares in Anvil on the Australian bourse had rallied to $18.10.
The mine outperformed its production targets over the June quarter, producing 5951 tonnes of copper with a head grade of 7.7%. Anvil also began commercial mining at its Kinsevere copper operation this year.
Other contracts recommended for renegotiation, according to the newswire, include BHP Billiton - which is exploring for copper and diamonds - Freeport McMoran, AngloGold Ashanti, Anglo American and London-based Central African Mining and Exploration.
Freeport's Tenke Fungurume project was criticised for not respecting the country's mining code.
"The Government should end all these conventions and invite the parties to sign a new partnership conforming to the mining code with the right of pre-emption in favour of the current partner," the report said.
BHP and AngloGold - both in joint ventures with state companies - were similarly criticised.
The newswire said most contracts were negotiated in the 1998-2003 war and during the following three-year transition period, and the aim of the commission was to bring these contracts and others up to international standards.
"[The document] is the work of a subcommittee and is not the final version of the report. There still could be changes," a commission member told Reuters late last week.
The final report is expected to be presented to Congo's Minister of Mines tomorrow.
Congo held its first democratic elections in more than four decades last year, and had flagged plans for a review of the legality and fairness of mining contracts.
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