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Ivanhoe Mines said on Wednesday its copper mining joint venture in the Democratic Republic of Congo, which started production last week, had signed a 10-year deal to process some of its copper concentrate at a nearby smelter.
Congolese authorities last week reiterated a long-standing ban on copper concentrate exports, and said only mining companies with waivers would be allowed to export concentrate.
The ban has been in place since 2013 to encourage domestic processing.
The Lualaba smelter, majority-owned by China Nonferrous Mining Corp Ltd (CNMC), will treat up to 150,000 wet metric tonnes of concentrate a year from the Kamoa-Kakula mine Ivanhoe is developing with Zijin Mining in return for a treatment charge and market-based realization fee.
The Lualaba smelter, majority-owned by China Nonferrous Mining Corp (CNMC), will treat up to 150,000 wet metric tonnes of concentrate a year
The 400,000 tonnes per year capacity smelter, which is around 40 kilometres (25 miles) from the mine by road, will produce blister copper ingots containing around 99% copper. The Ivanhoe-Zijin joint venture, Kamoa Copper, will then collect these from a storage area, Ivanhoe said in a statement.
The processing deal “will account for just under 40% of the total volumes of concentrates produced by Phase 1, making the most of available in-country smelter capacity,” said Kamoa Copper Chief Financial Officer Rochelle de Villiers, who is leading concentrate offtake and marketing negotiations.
The first delivery was made on Tuesday, she added.
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Ivanhoe expects Kamoa-Kakula to be the world’s highest-grade major copper mine. Production started ahead of schedule on May 26, and Ivanhoe expects output of 80,000 to 95,000 tonnes of copper in concentrate this year and peak annual output of over 800,000 tonnes after several phases of expansion.
In a separate statement, CNMC said the tolling agreement would allow both sides to realise synergies upstream and downstream, without elaborating.
Kamoa Copper is also evaluating the construction of a smelting complex which would produce blister and anode copper as well as sulphuric acid as a by-product.
(By Tom Daly and Helen Reid; Editing by Mark Potter)
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