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Congo received at least $33 Million to approve China mine deal

Citation: Date:2017-2-6 16:07:17

The Democratic Republic of Congo’s state-owned Gecamines received at least $33 million to proceed with the $3.8 billion sale of one of the country’s biggest copper mines to Chinese buyers after blocking a deal for eight months.

Freeport McMoran paid the settlement as its share in an agreement to resolve all claims against the sale in May of its 56% stake in the Tenke Fungurume copper and cobalt mine to China Molybdenum Co.

The agreement was also signed by Gecamines, China Moly, Lundin Mining Corp. and BHR Newwood Investment Management, Freeport said in a statement published Wednesday.

The statement didn’t report the total value of the settlement or the financial share paid by the other parties. Gecamines didn’t immediately respond to a request for comment.

The state-owned miner, which holds 20% of Tenke, opened an arbitration process in Paris in October to block the $2.65 billion Freeport sale.

It continued to oppose any change in ownership after partner Lundin in November said it would also exit the project by selling its 24% stake to Chinese private-equity firm BHR Partners for at least $1.14 billion.

Gecamines has in the past received compensation after opposing similar transactions. In 2012, it almost stopped the acquisition of Anvil Mining NL by China’s Minmetals Resources Ltd. The deal proceeded after they reached an agreement that included Anvil paying $55 million to Gecamines.

The settlement, which will allow Freeport and Lundin to exit the project without legal challenge, has been met with calls for Gecamines to disclose the full details of the financial agreement within 60 days, as required by Congolese law.

“It is essential that all parties to the transaction abide by their transparency commitments and provide further information on the deal,” Daniel Mule, extractives industries program manager at Atlanta-based advocacy group Carter Center, said in a statement 19 January.