Africa-focused gold producer Randgold Resources (LON:RSS) expects to exceed its production target of 600,000 ounces of gold for the year from its Kibali mine in the Democratic Republic of Congo, and said it was “aggressively engaged” in acquiring new mining rights in the country’s northeast region.
Speaking at a quarterly update for local media, chief executive Mark Bristow said that the recent completion of vertical shaft sinking ahead of schedule marks “a major advance” in the development of the underground mine, which will complement its existing open pit operation.
“With the mine settling down, we have been able to intensify our focus on sustainability issues such as the mine’s ISO certifications in the field of the environment, health and safety,” he noted in the statement.
The country’s mining industry has attracted miners from all over the world, particularly Canadians, and it is said to have at least $25 trillion dollars in untapped mineral deposits, mainly cobalt, diamonds, gold and copper.
The government in is the midst of reviewing planned adjustments to its 2002 Mining Code, an initiative that most companies, including Randgold, welcome.
“We applaud the government’s decision to take another look at the proposed changes to the country’s mining code, which in our view are deeply flawed. The DRC possesses enormous mineral resources, and has the potential to become one of Africa’s wealthiest countries,” Bristow said.
“With the drop in commodity prices, however, international capital providers will need the security of a transparent and equitable mining code before they invest further in what we believe could grow into a world-class mining industry,” Bristow added.
$1.36bn in secret deals
The proposed modifications, say main opponents, include removing key regulations that ban politicians and senior army figures from owning mining rights.
According to the latest analysis by research and advocacy group Global Witness, secret mining deals in recent years are estimated to have cost Congo at least $1.36 billion – equivalent to twice the country’s annual health and education spending combined.
The organization warns that the planned changes will loosen transparency provisions, such as requiring the publication of contracts. This, Global Witness claims, will worsen a lack of transparency and scrutiny in bidding processes, allotting too much discretion to the mining minister.
Additionally, the new rules would leave state-owned enterprises largely unregulated, eliminating articles that limit the army’s involvement in the minerals trade.