| Thu 15 Jan 2004, 10:47 | | Mvela signs up for DRC mining investments |
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Mvela signs up for DRC mining investments
January 15, 2004
By Sherilee Bridge
Johannesburg - Tokyo Sexwale, the chairman of Mvelaphanda Holdings, yesterday extended the scope of his mining investments to include copper and cobalt, after agreeing to participate in a $100 million development in the Democratic Republic of Congo (DRC).
Mvela will make the investment as part of a consortium of South African companies.
Mvela and its partner, the Afrimineral Holdings Group, are expected to also invest an initial $10 million in the first phase of the Kilomoto gold project.
Sexwale, who is in the DRC as part of a business delegation accompanying President Thabo Mbeki, signed the agreements in a ceremony at the South African embassy in Kinshasa.
The visit was aimed at improving ties and increasing investment in the war-torn DRC.
Sexwale said Mvela's participation was part of the company's consolidation of its mining interests in central and southern Africa.
The larger of the investments, the acquisition of 100 percent of the assets of the Ruashi copper and cobalt project, would be made as part of a consortium.
Without providing the names of the other companies in the consortium, a statement issued by Mvela said only that the group included "a well-respected South African operating company".
The $100 million project will be developed in two stages, with the first expected to begin production by the end of this year.
This stage is expected to exhaust the 4 million tons of ore stockpiled at Ruashi and Etoile, near Lubumbashi.
"The second stage, which will commence simultaneously, will focus on an assessment of ore reserves at Ruashi and the construction of a plant capable of producing copper and cobalt metal for export," Mvela said in its statement.
The second memorandum of understanding, signed with Zwelakhe Sisulu's Afrimineral Holdings Group as partner, opens the way for Mvela to enter into a joint venture with Okimo, the Congolese gold mining and exploration group, on the Kilomoto gold project in eastern DRC.
The agreement allows the South African companies to explore, develop, exploit and process various gold assets. "We envisage an initial investment of $10 million for the first phase of the Kilomoto project," Sexwale said.
Projects worth billions of US dollars are expected to get under way in the DRC this year, as the African country begins rebuilding an economy ripped apart by five years of civil war.
South African businesses are already bidding for a substantial number of the lucrative contracts, particularly in the mining sector.
DRC's mineral wealth holds massive potential but capital demands are huge, given the industry's collapse in the 1990s.
Shares in Mvelaphanda Resources, which houses Mvela's diamond and platinum investments, added almost 3 percent to bring the share price to R25 on the JSE Securities Exchange yesterday.
