France targets Africa with new $550m state mining company

France plans to invest up to €400 million ($548 million) in a new state-owned mining company called Compagnie National des Mines de France (CMF).

The investment which will be spread out over five to seven years marks the establishment of the European nation's first new state-owned industrial enterprise in 20 years.

CMF will be built around the same model as Japan's Oil, Gas and Metals National Corporation (JOGMEC) which was created a decade ago on February 29, 2004 and has an annual budget of $150 million.

France's Bureau of Geological and Mining Research (BRGM) and the Agency for State Participation (EPA) will also be shareholders in CMF.

CMF's exploration activities will focus on specialty metals including lithium, germanium, tungsten, antimony and rare earths inside France and around the globe including former colonies in Africa and South America.

French Industry Minister Arnaud Montebourg said "francophone African countries, in particular, would like to work with us rather than do business with foreign multinationals."

Montebourg told Liberation he's visiting French Guiana next month concerning a gold project in the country.

"Colbertism is coming back and that is good," the firebrand minister said according to the FT, referring to Jean-Baptiste Colbert, 17th-century finance minister under "Sun King" Louis XIV and the father of French dirigisme.

The socialist government is also in the process of redrafting the country's antiquated mining code and last year granted permits for a French gold project owned by Canada's La Mancha Resources (TSE:LMA) and prospecting rights to Australian base metal explorer Variscan.

Apart from Eramet (EPA:ERA), a struggling nickel miner, and state-owned uranium miner and nuclear power plant operator Areva, the country has largely disappeared from global mining since the Seventies.

Montebourg said he did not rule out partnerships between CMF and the two companies.

In 2011 Areva and its former chief executive, Anne Lauvergeon was at the center of a controversy over a "very dubious" $2.5 billion deal to buy up African uranium mines.

France sets up national mining company