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The Congolese state mining company Gecamines' copper concentrator is seen at its Kambove operation in the southern province of Katanga. At its peak, Gecamines was almost a state within a state. It directly employed more than 30,000 people and ran schools, hospitals, flour mills and vast swathes of arable land, much of which it still maintains, further draining its stretched finances. (STAFF/REUTERS)
The Congolese state mining company Gecamines' copper concentrator is seen at its Kambove operation in the southern province of Katanga. At its peak, Gecamines was almost a state within a state. It directly employed more than 30,000 people and ran schools, hospitals, flour mills and vast swathes of arable land, much of which it still maintains, further draining its stretched finances. (STAFF/REUTERS)

Congo’s neglected state miner hankers for past glory Add to ...

“The deposits are there, but whether (Gecamines) can raise $1.5-billion remains to be seen,” said Bolade Olu-Adeyanju, metals analyst at Wood Mackenzie.

“Financing is the biggest impediment to Gecamines. Foreign investors are wary of the high political risk in Congo.”

Industry sources had spoken of a potential sale of a stake in Deziwa to trader and veteran Congo investor Glencore, which owns the nearby Mutanda operation. But that now looks unlikely, given Gecamines’ demand to keep a majority stake and its stated desire to use Deziwa as a test for its new partnership strategy.

“We can envisage several possibilities, but where we go into partnership, it is clear that we want to be majority owners,” says Kalej Nkand, speaking behind copper doors in his corner office on the fifth floor of Gecamines’ headquarters in the region’s mining hub of Lubumbashi.

A NATION’S COPPER BACKBONE At its peak, Gecamines was almost a state within a state. It directly employed more than 30,000 people and ran schools, hospitals, flour mills and vast swathes of arable land, much of which it still maintains, further draining its stretched finances.

Its roots are in the mining company set up at the turn of the last century by statesman Cecil Rhodes and Belgian King Leopold II, which later became Union Miniere du Haut Katanga, and then Gecamines.

In the boom, Gecamines accounted for about 7 per cent of global copper production and more than 60 per cent of cobalt.

But tumbling copper prices in the 1980s took its toll, as did the compounded effect of the Mobutu government’s system of patronage, which pillaged the company over decades.

The group hit a low point with the collapse of the central portion of the Kamoto underground mine in 1990 after years of underinvestment. At the time, Kamoto’s cobalt was Gecamines’ most profitable export.

Added to that, ethnic unrest in the 1990s drove out many of the workers from neighboring Kasai that staffed Gecamines’ mines and offices. Like the country crumbling around it, Gecamines hit a nadir from which it is still recovering.

And yet a short distance from the Kambove plant, there are undeniable signs of Gecamines’ investment drive. South African contractors are overseeing the construction of a new processing plant that will boost the operational hub’s capacity to digest towering stockpiles of rich ore from the nearby Kamfundwa mine.

At Congo’s border with Zambia, to the south, some 100 excavators and other machines were clearing customs.

But Kambove – like other parts of an empire that was once at technology’s cutting edge – is testament to the challenge ahead for Gecamines’ bosses.

“The concentrator has a capacity of 4,000 tonnes (of ore) ... but we struggle to make 3,000 tonnes. We have a lot of power cuts and limits on production, so sometimes it is closer to 2,000 tonnes,” says Louis Okuka, Kambove’s veteran director, wearing a blue hardhat and a weary expression.

“Back in 1961, the plant was all automated.”

Down the road towards the town of Likasi, the Shituru copper refinery is another rusting behemoth dating back to 1929, operating at roughly 10 or 20 per cent of its nameplate capacity.

Its nerve centre – far removed from the flat-screen computers of modern automated operations rooms – boasts two chalk boards and technology reminiscent of a 1950s science fiction show. Workers in the nearby offices sit in front of plastic-covered computers amid mountains of lever-arch files.

“Since 1929, generations have passed through here – not just of men, but of equipment. Iron in this climate, when it has worked 40 or 50 years, has outlived its useful life,” says Joel Tshinyama Pau, director of the Shituru operation, who says progressive investment can revive the plant.

Yet many still question whether Congo’s politicians and business leaders are really prepared to develop the assets.

Albert Yuma, the head of the Gecamines board, is close to Congolese president Joseph Kabila and has faced questions over secret asset sales to another Kabila associate, Israeli businessman Dan Gertler.

Despite falling foul of the IMF for the company’s failure to meet transparency requirements, Yuma has launched stinging attacks on Congo’s poor business climate in his role as head of the country’s business federation and has publicly championed the Gecamines re-launch.

A return to former glory will be a grueling slog and won’t be popular with everyone. Recent skirmishes with artisanal miners working illegally on Gecamines concessions have left new diggers with smashed windows and flat tires.

But a rebirth would also be a boost to national pride and, particularly, the pride of the copper producing region of Katanga that it once sustained.

“We can’t accept to see Gecamines disappear,” said B.H. Ntambwe Ngoy, head of Gecamines’ central operations.

“We have Gecamines in the blood.”

 

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