Kibali Prepares to Complete Underground Mine in the DRC
The mine is anticipating a significant increase in production once the final shaft commissioning, which remains on a tight schedule, has been completed. At a briefing for local media, Bristow said in spite of the high level of activity at the mine, there had been a significant improvement in the safety statistics, with its total injury frequency rate continuing to decrease and lost time injury frequency rate down to 0.31 per million hours worked in the September quarter.
Following the anticipated completion of the underground mine in the fourth quarter, the only major capital project still in the works would be Kibali’s third new hydropower station, currently being constructed by an all-Congolese contracting team. Bristow said the availability of self-generated hydropower and the mine’s high degree of mechanization and automation were important factors in Kibali’s ability to sustain its profitability throughout the ups and downs of the gold price cycle.
To date, more than $2 billion has been spent on acquiring and developing Kibali. “With capital expenditure tapering off, Kibali should now be preparing to pay back the loans taken to fund its development,” Bristow said. “We are concerned, however, that its ability to do so will be impeded by the increasing amount of debt — currently standing at more than $200 million — owed to the mine by the government. TVA refunds, excess taxes and royalties in violation of the country’s mining code, make up the bulk of this amount.”
Another troubling development was the recent reintroduction by the Ministry of Mines of a proposed new mining code, which is exactly the same as the one the government withdrew in 2015 after it was demonstrated that it would seriously damage or even destroy the Congolese mining industry.
Kibali spent approximately $40 million with Congolese contractors in the past three months alone, Bristow explained. “The DRC has all the materials for building a sustainable mining industry but that will require a fully committed partnership between the government on the one hand and the mining companies on the other,” Bristow said.