Freeport-McMoRan Copper & Gold Inc. (FCX)’s Tenke Fungurume copper and cobalt mine has had to reduce operating rates because of frequent power outages in the past few weeks in the Democratic Republic of Congo.
The company is working with SNEL, the state-owned electricity company, and DRC authorities to resolve the issues, Eric Kinneberg, a Freeport spokesman, said by e-mail today. Freeport, based in Phoenix and the world’s largest publicly traded copper producer, operates Tenke and owns 56 percent of the mine. Lundin Mining Corp. has a 24 percent stake and the rest is controlled by Congo’s state-owned mining company.
Mines such as Tenke aren’t receiving power promised by SNEL, according to a statement on the website of Prime Minister Matata Ponyo. Mine operators risk “enormous losses” because of the power shortages, the government said.
Copper and cobalt-rich Katanga province has a power shortage of more than 300 megawatts, according to the statement. SNEL is supposed to purchase power from neighboring Zambia to make up for part of the shortfall. The government met with Tenke representatives Sept. 27 and will make it possible for the unit to pay Zambia directly for power.
While Congo has about 2,400 megawatts of installed power capacity, the World Bank says mismanagement means only about half of it is available. Glencore Xstrata Plc (GLEN)’s Katanga Mining project lost 67 days of output because of “recurrent general power disruptions” in 2012, Glencore said in its annual report.
Tenke “has made substantial investments with SNEL to secure reliable power on the Katanga grid, including the refurbishment of four turbines at the Nseke hydro power station that serves users on the Katanga network,” Freeport’s Kinneberg said today.
To contact the editor responsible for this story: Simon Casey at firstname.lastname@example.org