UPDATE 2-Congo's copper province governor rejects export ban

Thu Apr 18, 2013 1:28pm EDT
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By Jonny Hogg

KINSHASA, April 18 (Reuters) - The governor of Katanga, Congo's sole copper and cobalt mining province, said he would not enforce a new ban on the export of copper and cobalt concentrates, putting him on a collision course with the central government.

The mines and finance ministers signed a directive this month giving companies 90 days to clear their stocks of concentrate before the ban comes into effect, after which processing would have to be done in Congo or heavy payments made to the government.

"As the government of Katanga we reject this decision, and we will continue exporting," Moise Katumbi said by telephone. "Congo doesn't have enough electricity to process the finished product."

Congo is the world's largest producer of cobalt, which is used to create high-strength alloys, and exported 650,000 tonnes of copper in 2012, around 30 percent of which was in concentrate form, according to Katumbi.

Shares of Congo-focused miners Ivanplats Ltd and Freeport-McMoRan Copper & Gold rose on Thursday, reversing some of the losses that followed the announcement on Wednesday of the government's ban.

Despite a vast network of rivers, Congo exploits only a fraction of its hydroelectric potential, and the government expects power shortages to worsen in the coming years.

Less than 10 percent of Congo's 70 million people have access to power, and mining companies are already scaling back production and expansion because of shortages, with only about half of the 14 turbines at its Inga dam operational.   Continued...