Chetan Chug, Managing Director, SOMIKA

Diversification and a long-term perspective critical SOMIKA’s success.

Could you provide brief update on the major milestones that SOMIKA has achieved in the past few years?

Since 2016, SOMIKA has managed to acquire mining rights closer to Lubumbashi. Additionally, we have begun mining with a process plant that brings the ore from two percent to ten percent grade. Now that SOMIKA has a fully installed capacity for 20 thousand tons of copper cathodes and two thousand tons of cobalt hydroxide production, our production will reach full capacity in 2018. We have several expansions we are looking to accomplish in 2018 as well. SOMIKA is looking to have its  own sulfuric acid plant at the site of PE 2590, a mining site, that will allow our company to grow by gaining greater independence in our mission to achieve full integration through our operations. In 2018, at the site of concession PE 2590 SOMIKA has a planned expansion of 20000 Mt of copper cathodes production. KIMIN is planning for an expansion of 20000 Mt copper cathodes and 2500 Mt of cobalt hydroxides in 2019.

How did SOMIKA adapt its strategy during the downturn of commodity prices?

The Business Environment

A controversial mining code and newly delineated borders to the country’s provinces create cause for concern while updates from the banking sector offer some conciliation.

By Lindsay Davis

Just months after announcing its entry into the DRC, TSX-listed First Cobalt withdrew its exploration activities from the country, announcing that instead it would focus on its cobalt prospects in Canada. Citing a deteriorated investment climate, the company’s CEO, Trent Mell, elaborated on the company’s reason for the quick departure in a statement to Quartz: “With the signals we’re getting, why would we invest our scarce dollars in a country that may not respect our investment rights?”

Amaury Luyckx, Business Development Manager, and George Ioannou, Business Development Manager for Afric, Polytra

Polytra discusses the challenges of logistics and power for the mining industry in the DRC.

Polytra has been operating major projects in Africa since 1974, making it one of the longest standing freight forwarding companies in the DRC. What milestones have been achieved by the organization most recently?

GI: We have completed several major energy projects to bring the necessary capacity to the mining industry, and we continue to move new energy projects and equipment for the mining sector. We have also been operating in more remote areas such as the Manono project where we have been moving a large amount of solar panels. This operation required a combination of expertise because it was a difficult and remote area. Experience and knowledge of the people and the terrain allowed us to conduct a successful mission. We were also awarded one of the largest contracts in DRC: the NYA cement plant. Our speed of execution through logistics broke several records. We have also restructured our Africa freight forwarding desk to cater for the changes in the market and are now one of the largest movers of non-ferrous metals out of the Copperbelt (DRC/ZAMBIA) to the rest of the world via most Africa exit ports.

How has the uptick in the copper price impacted Polytra’s activities and how did the company adapt itself accordingly?

Manya Riche, CEO Sodeico, Djo Moupondo, CEO Sodeico Development , Christian Bombile, Director of Southern Region, Sodeico

Seodeico speaks to GBR about the labour situation in the DRC mining sector and how to benefit from and foster local skills.

Sodeico was established in 1987 and offers recruitment, outsourcing, payroll, consultancy, training, and HR solutions. How important is the mining industry as a client to the company andhow do you aid in the recruitment process?

MR: The importance of mining to our company is like every other company in the country given that the industry is the main contributor to the GDP of the country. Our advantage is that we are local and can assist with the difficulties related to the cultural differences that multinational companies operating in DRC might face. We also have strong knowledge of the market and can help to match the needs of the client with the skills that are available. Our mining clients mainly make use of our outsourcing services and are now beginning to use more of our recruitment solutions. The local workforce here is mostly semi-skilled, but when moving to a different stage of the project cycle there is a need for more skilled manpower. If we compare the skills available here with expatriates, we still face difficulties in sourcing a local high-skilled workforce.

What needs to happen to create a more readily available workforce here in the DRC for the mining industry?

Deon Heyns, CEO, Congo Equipment

Congo Equipment is the Caterpillar dealer for DRC and speaks to GBR about operating in that country.

Congo Equipment began as a JV between Barloworld Equipment and Tractafric, and serves as the exclusive Caterpillar dealership in the Katanga region. Can you highlight the company’s role in the mining sector and strategy for growth?

We provide machines, services, parts and after-sales support to most of the major players in the DRC mining industry. A significant part of our business is Customer Service Agreements (CSAs) whereby we have a presence on-site with the large customers to carry out maintenance of their equipment. From a growth perspective, we grow with our customers and also look to become involved with emerging players.  Our key service offering is to look after our customers and ensure that their machines are continuously available, giving them the lowest operating costs through enhanced efficiency, technical knowledge and technology.

How does the market demand for Caterpillar products in the DRC differ from other regions and in what areas do you see an opportunity for growth?

Stephanie Jacobs, Co-owner/Founder and Managing Director, TIAfrica

TIAfrica is a legal firm that specializes in guiding investors through DRC’s complicated web of regulations.

What was the opportunity you saw in DRC that gave way to the creation of TIAfrica?

DRC is one of the wealthiest countries in the world in terms of mineral resources, which naturally creates incredible opportunities, not only for the multinational corporates who service the mining contracts, but more importantly, the smaller support service providers, both local and foreign, who are the backbone of developing nations.

TIAfrica was born from a strong mining background, and understands in detail the requirements of the Investors and the areas where they may need assistance.  We also understand the local operational structure and the compliancy criteria relating to legal status, taxation, labour, import/export and many other government structures.

Francis Kasongo, Managing Director, AEL Mining

AEL Mining is prepared to meet growing demand in the DRC.

In 2013 AEL mining built its first manufacturing plant here in DRC, and also recently opened an office in Kinshasa. What new milestones has AEL achieved since then, and what is your strategy going forward?

The aim of AEL is to implement an industry instead of simply being a trader. Today we have one of the largest operational plants in central Africa based in Kolwezi; this is so we are able to handle any new demand that comes into the country. We have an excess of 40% spare  capacity. Depending on the logistics, we believe this plant can supply the total requirement in the DRC today. Due to those logistics constraints, we are using our regional capacity from AEL Zambia and Tanzania bulk emulsion plants. The other milestone achieved is the opening of the office in Kinshasa in 2014 that gives us a comprehensive view of the opportunities within the DRC. We now also have additional sites in Manyema, Kindu, and in Songololo, Kongo Central Province.

The DRC is known for its cobalt and copper, but do you see potential for growth within the country in other commodities?

Michael Demey, Regional Manager, BCDC

BCDC is the oldest bank operating in DRC and speaks to GBR about its activities with the mining sector.

BCDC was founded in 1909, and as such is the oldest bank in the DRC. How has the institution evolved and what role does it play in the mining sector?

With more than 100 years of experience in Congo, BCDC is a long-lasting and a robust institution that inspires respect in the DRC and beyond. Despite regulatory constraints and economic situations, we have strong fundamentals and the profitability of the last years prove it by.

Through our expertise, BCDC is the partner of all major players in the DRC including the biggest mining projects. BCDC has played a major role in the mining sector for decades. Through our vast network located in the mining area and even within some mining sites, we provide the different banking services needed: facilities for the working capital, payroll solutions, follow-up on transactions and regulations…

What are some of the key services BCDC offers and how would you describe your role in the mining industry?

Miles Naude, General Manager, MMG

GBR meets with MMG to discuss its operations in DRC and what needs to be done to improve the business environment.

Looking at the current situation in the DRC, what does MMG believe needs to happen for the country to recognize its full mineral potential?

We need more robust conversations on how to improve the business environment to get investors excited, specifically by discussing how to support the large industries by bringing in smaller industries. There are not many small industries currently active in the DRC; most of them are sitting across the border where there is a more conducive business environment. We need to support the capacity of smaller companies to supply consumables and other items into the mining sector to promote a healthier industry overall. It is not the job for the mining industry to do grassroots development of these industries, however, discussion needs to happen between the private sector and the government to change the regulatory framework to the benefit of all the different industries.

How does MMG approach its relationship with the government in the DRC and how can the private sector best assist in improving the conditions in DRC?

Operating in Tanganyika Province

Manono is finding a new life as a mining town after years of neglect.

By Graeme Johnston, Project Manager, AVZ Minerals – Manono

When touching down on Manono’s dusty airstrip, a leisurely 90 minute flight north of the DRC’s second largest city Lubumbashi (a hove of frenetic copper and cobalt exploration activity at the moment) you might be forgiven for thinking that you had arrived in the land that time forgot. Driving out of the airport, past the UN camp and into the main part of Manono can be unnerving to those like myself who have not spent much time in the centre of Africa.  However, the incongruities of driving past various international aid outlets and NGO compounds into the wide, old fashioned Belgian mango tree lined boulevards with their elegant, but sadly, run down houses only serves to highlight the long history of colonial involvement in the country and its more recent turbulent past.