TORONTO, Dec 7 (Reuters) - The Democratic Republic of Congo's review of the Tenke Fungurume copper-cobalt mine contract may disrupt Tenke's development timetable if it is not complete by the end of the first quarter of next year, minority owner Lundin Mining said on Monday.
Tenke, which is majority-owned and operated by U.S. miner Freeport-McMoRan Copper & Gold, began mining metal in March and has continued to operate even though it is one of 61 mining projects whose contract has been looked at by the government with a view to renegotiation.
The DRC launched the industry-wide review in 2007 and Tenke is one of the last remaining contracts to be finalized. Neither Freeport nor Lundin have offered an opinion on the outcome of the review or when it will be finished.
Freeport and Lundin were given until Oct. 12 to complete negotiations with the government or risk losing their mining permit. That deadline has passed with no resolution.
Speaking at a mining conference in Toronto, Lundin Chief Executive Phil Wright said the review should not have any impact on the progress of the mine until the end of the first quarter, when Freeport will have to make a decision on going ahead with the next phase of construction.
The current operations are designed to produce 250 million pounds of copper and 18 million pounds of cobalt a year, but the mine is seen eventually producing up to 1 billion pounds of copper annually.
'If the contract review is not completed by end of (the first quarter) it will sit on a critical path,' Wright said.
'At that point Freeport will have to ask, do you invest more money?'
The contract review has been part of an effort to boost DRC state revenues by renegotiating agreements signed mostly during the chaos and corruption of a 1998-2003 war and the transitional government that followed.
Wright said that the current Tenke contract is already on terms favorable to the government. Freeport was not immediately available for comment.
($1=$1.05 Canadian)
(Reporting by Cameron French; editing by Peter Galloway) Keywords: LUNDIN FREEPORT/TENKE (cameron.french@thomsonreuters.com; 416-941-8199: Reuters Messaging: cameron.french.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
Tenke, which is majority-owned and operated by U.S. miner Freeport-McMoRan Copper & Gold, began mining metal in March and has continued to operate even though it is one of 61 mining projects whose contract has been looked at by the government with a view to renegotiation.
The DRC launched the industry-wide review in 2007 and Tenke is one of the last remaining contracts to be finalized. Neither Freeport nor Lundin have offered an opinion on the outcome of the review or when it will be finished.
Freeport and Lundin were given until Oct. 12 to complete negotiations with the government or risk losing their mining permit. That deadline has passed with no resolution.
Speaking at a mining conference in Toronto, Lundin Chief Executive Phil Wright said the review should not have any impact on the progress of the mine until the end of the first quarter, when Freeport will have to make a decision on going ahead with the next phase of construction.
The current operations are designed to produce 250 million pounds of copper and 18 million pounds of cobalt a year, but the mine is seen eventually producing up to 1 billion pounds of copper annually.
'If the contract review is not completed by end of (the first quarter) it will sit on a critical path,' Wright said.
'At that point Freeport will have to ask, do you invest more money?'
The contract review has been part of an effort to boost DRC state revenues by renegotiating agreements signed mostly during the chaos and corruption of a 1998-2003 war and the transitional government that followed.
Wright said that the current Tenke contract is already on terms favorable to the government. Freeport was not immediately available for comment.
($1=$1.05 Canadian)
(Reporting by Cameron French; editing by Peter Galloway) Keywords: LUNDIN FREEPORT/TENKE (cameron.french@thomsonreuters.com; 416-941-8199: Reuters Messaging: cameron.french.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.