Eurasian Natural Resources Corp. (ENRC) will pay the Democratic Republic of Congo $101.5 million for the mining license at its Frontier site, purchased this year as part of an acquisition of assets from First Quantum Minerals Ltd. (FM)
ENRC, which bought First Quantum assets in Congo including its share of the Kolwezi and Lonshi projects for $1.25 billion, plans to begin annual output of as much as 92,000 metric tons of copper concentrate at Frontier in 9 to 12 months, said Chief Executive Officer Felix Vulis in a phone interview today.
“The historical maximum capacity of this plant was 92,000 tons of copper concentrate,” Vulis said. “It’s about that amount we are keen to produce.” The company plans to refine the concentrate from Frontier at its Chambishi smelter in Zambia, about 70 kilometers (44 miles) away from the mine, he said.
The license will be issued in coming weeks, ENRC said.
“We see this as a positive step in allowing ENRC to commence operations,” Jason Fairclough, a Bank of America Corp. analyst, said in a note. “We estimate a Net Present Value for this mine of $1.6 billion, which is not included in our base case NPV.”
ENRC, a producer of ferroalloys, iron ore, aluminum and power in Kazakhstan, also owns copper and cobalt producers Central African Mining & Exploration Co. in Congo and Chambishi Metals Plc in Zambia. It bought the license when it was released by the prior owners in a deal with the Congo government, Vulis said. “We are working with the DRC government only,” he said.
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