Hodlandwin69
Regular
Also probably some delay due to office closures over the holidays
AVZ Discussion 2022
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- Start date
anyone has access to the afr and this article? curious on what they say re these miners in the drc.
www.afr.com
BHP and Rio Tinto see just one problem with the big new copper mine Robert Friedland has built in the DRC. But the US government reckons it has the solution
Why the US wants BHP and Rio to get crazy rich in the Congo
BHP and Rio Tinto see just one problem with the big new copper mine Robert Friedland has built in the DRC. But the US government reckons it has the solution
BHP and Rio Tinto see just one problem with the big new copper mine Robert Friedland has built in the DRC. But the US government reckons it has the solution
anyone has access to the afr and this article? curious on what they say re these miners in the drc.
Why the US wants BHP and Rio to get crazy rich in the Congo
BHP and Rio Tinto see just one problem with the big new copper mine Robert Friedland has built in the DRC. But the US government reckons it has the solution
BHP and Rio Tinto see just one problem with the big new copper mine Robert Friedland has built in the DRC. But the US government reckons it has the solution
Why the US wants BHP and Rio to get crazy rich in the Congo
Peter KerResources reporter
Jan 6, 2025 – 5.00am
If a sequel is ever made to the 2018 box office hit Crazy Rich Asians, it could well be Crazy Rich in the Democratic Republic of Congo.
American billionaire Robert Friedland owned the film production company that made the former, and his flagship copper company Ivanhoe Mines is fast achieving the latter.
Ivanhoe talisman Robert Friedland was in Sydney in November. Rhett Wyman
In the decade since Rio Tinto bought Friedland out of Mongolia’s Oyu Tolgoi copper project, the legendary explorer has found and built another of the world’s great copper mines, this time at Kamoa-Kakula in the DRC.
The dirt at Kamoa-Kakula is fabulously rich in copper and much of the power for the mine comes from carbon-free hydroelectric generators nearby.
Production has been under way for just over three years, but already Kamoa-Kakula is the world’s fourth-biggest copper producer. If expansions go to plan, it could sneak into second place by 2028
At a time when BHP and Rio are hungry for copper and pulling the trigger on acquisitions, it’s curious that Ivanhoe and Kamoa-Kakula haven’t yet caught a bid.
Compared to BHP’s highly complicated attempt to acquire Anglo American last year, a bid for Ivanhoe – which owns 39.6 per cent of Kamoa-Kakula – would be simpler to complete and should be doable at half the price.
The big Australian miners are impressed by what Friedland has created in the DRC; a delegation from Rio have visited Kamoa-Kakula, and according to those within earshot, the delegation left the DRC thinking they had seen the world’s best copper mine.
Friedland has many admirers in the boardrooms of BHP and Rio. One person who serves as a director on one such board told The Australian Financial Review they consider Friedland “a genius”.
It’s not just Friedland’s ability to find copper mines that has impressed; Friedland’s work on “pulsed power” has also got the big miners excited.
Pulsed power is a method of accumulating electrical energy over a long period then releasing it instantaneously; thereby compressing and concentrating it to deliver a greater force.
The Friedland camp reckons pulsed power could allow the mining industry to dramatically reduce the amount of energy it consumes when grinding and drilling through rock.
BHP chief executive Mike Henry was so impressed by pulsed power he bought BHP a stake in two of the Friedland companies trying to apply the technology; I-Pulse and I-Rox. Henry then made a personal appearance in a promotional video for I-Rox, describing it as a “breakthrough technology” that could “radically transform the way we go about the act of mining and processing”.
But as the deification of Friedland gathers pace, one senior executive from the big two Australian miners who sat down with the Financial Review on the condition of anonymity pointed out a fly in the ointment at Kamoa-Kakula – one that may explain why Ivanhoe has eluded potential acquirers.
It’s not so much about the DRC’s traditional reputation for sovereign risk; miners are generally encouraged by the way DRC president Félix Tshisekedi has prioritised investment into the DRC from American and European sources.
Tshisekedi has been rewarded by the US State Department for his perceived progress on human rights and anti-corruption measures, winning greater access to US markets under the Africa Growth and Opportunity Act (AGOA).
Senior people now believe the DRC is investible for the right project; an extraordinary notion given the DRC was a byword for corruption and child labour barely a decade ago. (These days, Mali is the place mining executives refuse to go, lest they be held hostage.)
Which brings us back to the perceived problem with Kamoa-Kakula: transport and logistics.
The mine is land-locked about 1700 kilometres from the coast as the crow flies.
The vast majority of the copper produced at Kamoa-Kakula over the past three years has been trucked up to 3000 kilometres to ports like Durban in South Africa, Dar es Salaam in Tanzania, Walvis Bay in Namibia or Beira in Mozambique.
A return journey from Kamoa-Kakula to Durban often took 45 days, and rose to 70 days with congestion. Border crossings in Africa only create potential for complications.
The logistical cost of getting Kamoa-Kakula’s copper to port has been approximately 30 to 40 per cent of the mine’s C1 unit cost in recent years. According to Ivanhoe’s market filings, the C1 unit costs at Kamoa-Kakula were $US1.69 per pound in the September quarter.
That’s fairly competitive with the C1 costs BHP expects in the year to June 2025 at Chile’s Escondida (between $US1.30 and $US1.60 per pound) and its South Australian copper mines (between $US1.30 and $US1.80 per pound).
Those two BHP copper hubs are 170 kilometres and 560 kilometres from port respectively, and they also have shorter shipping journeys to customers in North Asia.
Ivanhoe reports another number called “cost of sales”, which was $US1.80 per pound in the three months to September 30.
That’s nothing to be ashamed of; it makes Kamoa-Kakula a cheaper mine than BHP’s Spence asset in Chile, and many of the world’s copper mines.
Two big efforts are under way to solve Kamoa-Kakula’s transport challenges and make it a lower cost producer.
Ivanhoe and its partners are building a smelter which will allow the mine to sell copper metal with 99 per cent purity, as opposed to the concentrate containing 50 per cent copper it mostly sells today.
The smelter will fire up in 2025, and selling copper with 99 per cent purity will mean Kamoa-Kakula doesn’t waste time and money transporting waste material to customers.
Ivanhoe reckons the smelter and the product switch could cut unit costs by 20 per cent and reduce the carbon intensity of each pound of copper by 46 per cent.
The US government is also determined to solve Ivanhoe’s transportation problems, and is pumping money into a 1739 kilometre rail and logistics corridor that will connect central African mines like Kamoa-Kakula to Lobito port in Angola.
The Lobito corridor is the US and European governments’ answer to China’s Belt and Road Initiative. It is designed to get African critical minerals to market faster, and to limit Chinese dominance of them.
The DRC overtook Peru as the world’s second-biggest copper producer in 2024, and Chinese companies like CMOC and Zijin are established players in the DRC.
Zijin is Ivanhoe’s partner at Kamoa-Kakula with a 39.6 per cent stake in the mine and 12.2 per cent of Ivanhoe’s shares. Chinese giant Citic owns 22.4 per cent of Ivanhoe.
The US government would dearly love for Ivanhoe’s stake in Kamoa-Kakula to stay in allied hands, lest China take control ahead of a decade when copper demand for decarbonisation and defence infrastructure is expected to soar.
It is no coincidence that the Lobito railway passes within five kilometres of Kamoa-Kakula, and the mine was among the first users of the railway when it sent trial volumes to Lobito in 2024.
Kamoa-Kakula is signed up to ship about half of its volumes to Lobito.
BHP and Rio have been heavily encouraged by their friends in the US State Department to get acquainted with the benefits of the Lobito corridor; the US funded rail network could be extended to help BHP and New York-listed Lifezone Metals develop the Kabanga nickel project in nearby Tanzania.
US President Joe Biden even travelled to Lobito port in early December, to observe its progress and pledge more money.
By this time next year, both the new smelter at Kamoa-Kakula and the Lobito corridor will be significantly advanced, and Ivanhoe’s logistics problems will be substantially solved.
Perhaps that will be the right time for BHP or Rio to get crazy rich in the DRC.
Related
Last edited:
Hemicuda
Regular
Who???
yup love ignore, eat a bag of dix toiletThere are a few sections of that article that could be dissected and used on a Friday , it tells us that AVZ is and always will be on its own in the battle .Why the US wants BHP and Rio to get crazy rich in the Congo
Peter KerResources reporter
Jan 6, 2025 – 5.00am
If a sequel is ever made to the 2018 box office hit Crazy Rich Asians, it could well be Crazy Rich in the Democratic Republic of Congo.
American billionaire Robert Friedland owned the film production company that made the former, and his flagship copper company Ivanhoe Mines is fast achieving the latter.
Ivanhoe talisman Robert Friedland was in Sydney in November. Rhett Wyman
In the decade since Rio Tinto bought Friedland out of Mongolia’s Oyu Tolgoi copper project, the legendary explorer has found and built another of the world’s great copper mines, this time at Kamoa-Kakula in the DRC.
The dirt at Kamoa-Kakula is fabulously rich in copper and much of the power for the mine comes from carbon-free hydroelectric generators nearby.
Production has been under way for just over three years, but already Kamoa-Kakula is the world’s fourth-biggest copper producer. If expansions go to plan, it could sneak into second place by 2028
At a time when BHP and Rio are hungry for copper and pulling the trigger on acquisitions, it’s curious that Ivanhoe and Kamoa-Kakula haven’t yet caught a bid.
Compared to BHP’s highly complicated attempt to acquire Anglo American last year, a bid for Ivanhoe – which owns 39.6 per cent of Kamoa-Kakula – would be simpler to complete and should be doable at half the price.
The big Australian miners are impressed by what Friedland has created in the DRC; a delegation from Rio have visited Kamoa-Kakula, and according to those within earshot, the delegation left the DRC thinking they had seen the world’s best copper mine.
Friedland has many admirers in the boardrooms of BHP and Rio. One person who serves as a director on one such board told The Australian Financial Review they consider Friedland “a genius”.
It’s not just Friedland’s ability to find copper mines that has impressed; Friedland’s work on “pulsed power” has also got the big miners excited.
Pulsed power is a method of accumulating electrical energy over a long period then releasing it instantaneously; thereby compressing and concentrating it to deliver a greater force.
The Friedland camp reckons pulsed power could allow the mining industry to dramatically reduce the amount of energy it consumes when grinding and drilling through rock.
BHP chief executive Mike Henry was so impressed by pulsed power he bought BHP a stake in two of the Friedland companies trying to apply the technology; I-Pulse and I-Rox. Henry then made a personal appearance in a promotional video for I-Rox, describing it as a “breakthrough technology” that could “radically transform the way we go about the act of mining and processing”.
But as the deification of Friedland gathers pace, one senior executive from the big two Australian miners who sat down with the Financial Review on the condition of anonymity pointed out a fly in the ointment at Kamoa-Kakula – one that may explain why Ivanhoe has eluded potential acquirers.
It’s not so much about the DRC’s traditional reputation for sovereign risk; miners are generally encouraged by the way DRC president Félix Tshisekedi has prioritised investment into the DRC from American and European sources.
Tshisekedi has been rewarded by the US State Department for his perceived progress on human rights and anti-corruption measures, winning greater access to US markets under the Africa Growth and Opportunity Act (AGOA).
Senior people now believe the DRC is investible for the right project; an extraordinary notion given the DRC was a byword for corruption and child labour barely a decade ago. (These days, Mali is the place mining executives refuse to go, lest they be held hostage.)
Which brings us back to the perceived problem with Kamoa-Kakula: transport and logistics.
The mine is land-locked about 1700 kilometres from the coast as the crow flies.
The vast majority of the copper produced at Kamoa-Kakula over the past three years has been trucked up to 3000 kilometres to ports like Durban in South Africa, Dar es Salaam in Tanzania, Walvis Bay in Namibia or Beira in Mozambique.
A return journey from Kamoa-Kakula to Durban often took 45 days, and rose to 70 days with congestion. Border crossings in Africa only create potential for complications.
The logistical cost of getting Kamoa-Kakula’s copper to port has been approximately 30 to 40 per cent of the mine’s C1 unit cost in recent years. According to Ivanhoe’s market filings, the C1 unit costs at Kamoa-Kakula were $US1.69 per pound in the September quarter.
That’s fairly competitive with the C1 costs BHP expects in the year to June 2025 at Chile’s Escondida (between $US1.30 and $US1.60 per pound) and its South Australian copper mines (between $US1.30 and $US1.80 per pound).
Those two BHP copper hubs are 170 kilometres and 560 kilometres from port respectively, and they also have shorter shipping journeys to customers in North Asia.
Ivanhoe reports another number called “cost of sales”, which was $US1.80 per pound in the three months to September 30.
That’s nothing to be ashamed of; it makes Kamoa-Kakula a cheaper mine than BHP’s Spence asset in Chile, and many of the world’s copper mines.
Two big efforts are under way to solve Kamoa-Kakula’s transport challenges and make it a lower cost producer.
Ivanhoe and its partners are building a smelter which will allow the mine to sell copper metal with 99 per cent purity, as opposed to the concentrate containing 50 per cent copper it mostly sells today.
The smelter will fire up in 2025, and selling copper with 99 per cent purity will mean Kamoa-Kakula doesn’t waste time and money transporting waste material to customers.
Ivanhoe reckons the smelter and the product switch could cut unit costs by 20 per cent and reduce the carbon intensity of each pound of copper by 46 per cent.
The US government is also determined to solve Ivanhoe’s transportation problems, and is pumping money into a 1739 kilometre rail and logistics corridor that will connect central African mines like Kamoa-Kakula to Lobito port in Angola.
The Lobito corridor is the US and European governments’ answer to China’s Belt and Road Initiative. It is designed to get African critical minerals to market faster, and to limit Chinese dominance of them.
The DRC overtook Peru as the world’s second-biggest copper producer in 2024, and Chinese companies like CMOC and Zijin are established players in the DRC.
Zijin is Ivanhoe’s partner at Kamoa-Kakula with a 39.6 per cent stake in the mine and 12.2 per cent of Ivanhoe’s shares. Chinese giant Citic owns 22.4 per cent of Ivanhoe.
The US government would dearly love for Ivanhoe’s stake in Kamoa-Kakula to stay in allied hands, lest China take control ahead of a decade when copper demand for decarbonisation and defence infrastructure is expected to soar.
It is no coincidence that the Lobito railway passes within five kilometres of Kamoa-Kakula, and the mine was among the first users of the railway when it sent trial volumes to Lobito in 2024.
Kamoa-Kakula is signed up to ship about half of its volumes to Lobito.
BHP and Rio have been heavily encouraged by their friends in the US State Department to get acquainted with the benefits of the Lobito corridor; the US funded rail network could be extended to help BHP and New York-listed Lifezone Metals develop the Kabanga nickel project in nearby Tanzania.
US President Joe Biden even travelled to Lobito port in early December, to observe its progress and pledge more money.
By this time next year, both the new smelter at Kamoa-Kakula and the Lobito corridor will be significantly advanced, and Ivanhoe’s logistics problems will be substantially solved.
Perhaps that will be the right time for BHP or Rio to get crazy rich in the DRC.
Related
"It’s not so much about the DRC’s traditional reputation for sovereign risk; miners are generally encouraged by the way DRC president Félix Tshisekedi has prioritized investment into the DRC from American and European sources. Senior people now believe the DRC is investible ."Why the US wants BHP and Rio to get crazy rich in the Congo
Peter KerResources reporter
Jan 6, 2025 – 5.00am
If a sequel is ever made to the 2018 box office hit Crazy Rich Asians, it could well be Crazy Rich in the Democratic Republic of Congo.
American billionaire Robert Friedland owned the film production company that made the former, and his flagship copper company Ivanhoe Mines is fast achieving the latter.
Ivanhoe talisman Robert Friedland was in Sydney in November. Rhett Wyman
In the decade since Rio Tinto bought Friedland out of Mongolia’s Oyu Tolgoi copper project, the legendary explorer has found and built another of the world’s great copper mines, this time at Kamoa-Kakula in the DRC.
The dirt at Kamoa-Kakula is fabulously rich in copper and much of the power for the mine comes from carbon-free hydroelectric generators nearby.
Production has been under way for just over three years, but already Kamoa-Kakula is the world’s fourth-biggest copper producer. If expansions go to plan, it could sneak into second place by 2028
At a time when BHP and Rio are hungry for copper and pulling the trigger on acquisitions, it’s curious that Ivanhoe and Kamoa-Kakula haven’t yet caught a bid.
Compared to BHP’s highly complicated attempt to acquire Anglo American last year, a bid for Ivanhoe – which owns 39.6 per cent of Kamoa-Kakula – would be simpler to complete and should be doable at half the price.
The big Australian miners are impressed by what Friedland has created in the DRC; a delegation from Rio have visited Kamoa-Kakula, and according to those within earshot, the delegation left the DRC thinking they had seen the world’s best copper mine.
Friedland has many admirers in the boardrooms of BHP and Rio. One person who serves as a director on one such board told The Australian Financial Review they consider Friedland “a genius”.
It’s not just Friedland’s ability to find copper mines that has impressed; Friedland’s work on “pulsed power” has also got the big miners excited.
Pulsed power is a method of accumulating electrical energy over a long period then releasing it instantaneously; thereby compressing and concentrating it to deliver a greater force.
The Friedland camp reckons pulsed power could allow the mining industry to dramatically reduce the amount of energy it consumes when grinding and drilling through rock.
BHP chief executive Mike Henry was so impressed by pulsed power he bought BHP a stake in two of the Friedland companies trying to apply the technology; I-Pulse and I-Rox. Henry then made a personal appearance in a promotional video for I-Rox, describing it as a “breakthrough technology” that could “radically transform the way we go about the act of mining and processing”.
But as the deification of Friedland gathers pace, one senior executive from the big two Australian miners who sat down with the Financial Review on the condition of anonymity pointed out a fly in the ointment at Kamoa-Kakula – one that may explain why Ivanhoe has eluded potential acquirers.
It’s not so much about the DRC’s traditional reputation for sovereign risk; miners are generally encouraged by the way DRC president Félix Tshisekedi has prioritised investment into the DRC from American and European sources.
Tshisekedi has been rewarded by the US State Department for his perceived progress on human rights and anti-corruption measures, winning greater access to US markets under the Africa Growth and Opportunity Act (AGOA).
Senior people now believe the DRC is investible for the right project; an extraordinary notion given the DRC was a byword for corruption and child labour barely a decade ago. (These days, Mali is the place mining executives refuse to go, lest they be held hostage.)
Which brings us back to the perceived problem with Kamoa-Kakula: transport and logistics.
The mine is land-locked about 1700 kilometres from the coast as the crow flies.
The vast majority of the copper produced at Kamoa-Kakula over the past three years has been trucked up to 3000 kilometres to ports like Durban in South Africa, Dar es Salaam in Tanzania, Walvis Bay in Namibia or Beira in Mozambique.
A return journey from Kamoa-Kakula to Durban often took 45 days, and rose to 70 days with congestion. Border crossings in Africa only create potential for complications.
The logistical cost of getting Kamoa-Kakula’s copper to port has been approximately 30 to 40 per cent of the mine’s C1 unit cost in recent years. According to Ivanhoe’s market filings, the C1 unit costs at Kamoa-Kakula were $US1.69 per pound in the September quarter.
That’s fairly competitive with the C1 costs BHP expects in the year to June 2025 at Chile’s Escondida (between $US1.30 and $US1.60 per pound) and its South Australian copper mines (between $US1.30 and $US1.80 per pound).
Those two BHP copper hubs are 170 kilometres and 560 kilometres from port respectively, and they also have shorter shipping journeys to customers in North Asia.
Ivanhoe reports another number called “cost of sales”, which was $US1.80 per pound in the three months to September 30.
That’s nothing to be ashamed of; it makes Kamoa-Kakula a cheaper mine than BHP’s Spence asset in Chile, and many of the world’s copper mines.
Two big efforts are under way to solve Kamoa-Kakula’s transport challenges and make it a lower cost producer.
Ivanhoe and its partners are building a smelter which will allow the mine to sell copper metal with 99 per cent purity, as opposed to the concentrate containing 50 per cent copper it mostly sells today.
The smelter will fire up in 2025, and selling copper with 99 per cent purity will mean Kamoa-Kakula doesn’t waste time and money transporting waste material to customers.
Ivanhoe reckons the smelter and the product switch could cut unit costs by 20 per cent and reduce the carbon intensity of each pound of copper by 46 per cent.
The US government is also determined to solve Ivanhoe’s transportation problems, and is pumping money into a 1739 kilometre rail and logistics corridor that will connect central African mines like Kamoa-Kakula to Lobito port in Angola.
The Lobito corridor is the US and European governments’ answer to China’s Belt and Road Initiative. It is designed to get African critical minerals to market faster, and to limit Chinese dominance of them.
The DRC overtook Peru as the world’s second-biggest copper producer in 2024, and Chinese companies like CMOC and Zijin are established players in the DRC.
Zijin is Ivanhoe’s partner at Kamoa-Kakula with a 39.6 per cent stake in the mine and 12.2 per cent of Ivanhoe’s shares. Chinese giant Citic owns 22.4 per cent of Ivanhoe.
The US government would dearly love for Ivanhoe’s stake in Kamoa-Kakula to stay in allied hands, lest China take control ahead of a decade when copper demand for decarbonisation and defence infrastructure is expected to soar.
It is no coincidence that the Lobito railway passes within five kilometres of Kamoa-Kakula, and the mine was among the first users of the railway when it sent trial volumes to Lobito in 2024.
Kamoa-Kakula is signed up to ship about half of its volumes to Lobito.
BHP and Rio have been heavily encouraged by their friends in the US State Department to get acquainted with the benefits of the Lobito corridor; the US funded rail network could be extended to help BHP and New York-listed Lifezone Metals develop the Kabanga nickel project in nearby Tanzania.
US President Joe Biden even travelled to Lobito port in early December, to observe its progress and pledge more money.
By this time next year, both the new smelter at Kamoa-Kakula and the Lobito corridor will be significantly advanced, and Ivanhoe’s logistics problems will be substantially solved.
Perhaps that will be the right time for BHP or Rio to get crazy rich in the DRC.
Related
LoL . Now sit back and watch AVZ Minerals blow that theory out of the water when the DRC Government is found guilty of one of the biggest acts of Corruption and Theft against a foreign investor in recent memory on planet earth . Felix is covered in fleas . IMO
Whats fascinating to me is how easily Friedland has been able to do business in the DRC. Genuinely has been able to make it look like a great place for foreign investment.Why the US wants BHP and Rio to get crazy rich in the Congo
Peter KerResources reporter
Jan 6, 2025 – 5.00am
If a sequel is ever made to the 2018 box office hit Crazy Rich Asians, it could well be Crazy Rich in the Democratic Republic of Congo.
American billionaire Robert Friedland owned the film production company that made the former, and his flagship copper company Ivanhoe Mines is fast achieving the latter.
Ivanhoe talisman Robert Friedland was in Sydney in November. Rhett Wyman
In the decade since Rio Tinto bought Friedland out of Mongolia’s Oyu Tolgoi copper project, the legendary explorer has found and built another of the world’s great copper mines, this time at Kamoa-Kakula in the DRC.
The dirt at Kamoa-Kakula is fabulously rich in copper and much of the power for the mine comes from carbon-free hydroelectric generators nearby.
Production has been under way for just over three years, but already Kamoa-Kakula is the world’s fourth-biggest copper producer. If expansions go to plan, it could sneak into second place by 2028
At a time when BHP and Rio are hungry for copper and pulling the trigger on acquisitions, it’s curious that Ivanhoe and Kamoa-Kakula haven’t yet caught a bid.
Compared to BHP’s highly complicated attempt to acquire Anglo American last year, a bid for Ivanhoe – which owns 39.6 per cent of Kamoa-Kakula – would be simpler to complete and should be doable at half the price.
The big Australian miners are impressed by what Friedland has created in the DRC; a delegation from Rio have visited Kamoa-Kakula, and according to those within earshot, the delegation left the DRC thinking they had seen the world’s best copper mine.
Friedland has many admirers in the boardrooms of BHP and Rio. One person who serves as a director on one such board told The Australian Financial Review they consider Friedland “a genius”.
It’s not just Friedland’s ability to find copper mines that has impressed; Friedland’s work on “pulsed power” has also got the big miners excited.
Pulsed power is a method of accumulating electrical energy over a long period then releasing it instantaneously; thereby compressing and concentrating it to deliver a greater force.
The Friedland camp reckons pulsed power could allow the mining industry to dramatically reduce the amount of energy it consumes when grinding and drilling through rock.
BHP chief executive Mike Henry was so impressed by pulsed power he bought BHP a stake in two of the Friedland companies trying to apply the technology; I-Pulse and I-Rox. Henry then made a personal appearance in a promotional video for I-Rox, describing it as a “breakthrough technology” that could “radically transform the way we go about the act of mining and processing”.
But as the deification of Friedland gathers pace, one senior executive from the big two Australian miners who sat down with the Financial Review on the condition of anonymity pointed out a fly in the ointment at Kamoa-Kakula – one that may explain why Ivanhoe has eluded potential acquirers.
It’s not so much about the DRC’s traditional reputation for sovereign risk; miners are generally encouraged by the way DRC president Félix Tshisekedi has prioritised investment into the DRC from American and European sources.
Tshisekedi has been rewarded by the US State Department for his perceived progress on human rights and anti-corruption measures, winning greater access to US markets under the Africa Growth and Opportunity Act (AGOA).
Senior people now believe the DRC is investible for the right project; an extraordinary notion given the DRC was a byword for corruption and child labour barely a decade ago. (These days, Mali is the place mining executives refuse to go, lest they be held hostage.)
Which brings us back to the perceived problem with Kamoa-Kakula: transport and logistics.
The mine is land-locked about 1700 kilometres from the coast as the crow flies.
The vast majority of the copper produced at Kamoa-Kakula over the past three years has been trucked up to 3000 kilometres to ports like Durban in South Africa, Dar es Salaam in Tanzania, Walvis Bay in Namibia or Beira in Mozambique.
A return journey from Kamoa-Kakula to Durban often took 45 days, and rose to 70 days with congestion. Border crossings in Africa only create potential for complications.
The logistical cost of getting Kamoa-Kakula’s copper to port has been approximately 30 to 40 per cent of the mine’s C1 unit cost in recent years. According to Ivanhoe’s market filings, the C1 unit costs at Kamoa-Kakula were $US1.69 per pound in the September quarter.
That’s fairly competitive with the C1 costs BHP expects in the year to June 2025 at Chile’s Escondida (between $US1.30 and $US1.60 per pound) and its South Australian copper mines (between $US1.30 and $US1.80 per pound).
Those two BHP copper hubs are 170 kilometres and 560 kilometres from port respectively, and they also have shorter shipping journeys to customers in North Asia.
Ivanhoe reports another number called “cost of sales”, which was $US1.80 per pound in the three months to September 30.
That’s nothing to be ashamed of; it makes Kamoa-Kakula a cheaper mine than BHP’s Spence asset in Chile, and many of the world’s copper mines.
Two big efforts are under way to solve Kamoa-Kakula’s transport challenges and make it a lower cost producer.
Ivanhoe and its partners are building a smelter which will allow the mine to sell copper metal with 99 per cent purity, as opposed to the concentrate containing 50 per cent copper it mostly sells today.
The smelter will fire up in 2025, and selling copper with 99 per cent purity will mean Kamoa-Kakula doesn’t waste time and money transporting waste material to customers.
Ivanhoe reckons the smelter and the product switch could cut unit costs by 20 per cent and reduce the carbon intensity of each pound of copper by 46 per cent.
The US government is also determined to solve Ivanhoe’s transportation problems, and is pumping money into a 1739 kilometre rail and logistics corridor that will connect central African mines like Kamoa-Kakula to Lobito port in Angola.
The Lobito corridor is the US and European governments’ answer to China’s Belt and Road Initiative. It is designed to get African critical minerals to market faster, and to limit Chinese dominance of them.
The DRC overtook Peru as the world’s second-biggest copper producer in 2024, and Chinese companies like CMOC and Zijin are established players in the DRC.
Zijin is Ivanhoe’s partner at Kamoa-Kakula with a 39.6 per cent stake in the mine and 12.2 per cent of Ivanhoe’s shares. Chinese giant Citic owns 22.4 per cent of Ivanhoe.
The US government would dearly love for Ivanhoe’s stake in Kamoa-Kakula to stay in allied hands, lest China take control ahead of a decade when copper demand for decarbonisation and defence infrastructure is expected to soar.
It is no coincidence that the Lobito railway passes within five kilometres of Kamoa-Kakula, and the mine was among the first users of the railway when it sent trial volumes to Lobito in 2024.
Kamoa-Kakula is signed up to ship about half of its volumes to Lobito.
BHP and Rio have been heavily encouraged by their friends in the US State Department to get acquainted with the benefits of the Lobito corridor; the US funded rail network could be extended to help BHP and New York-listed Lifezone Metals develop the Kabanga nickel project in nearby Tanzania.
US President Joe Biden even travelled to Lobito port in early December, to observe its progress and pledge more money.
By this time next year, both the new smelter at Kamoa-Kakula and the Lobito corridor will be significantly advanced, and Ivanhoe’s logistics problems will be substantially solved.
Perhaps that will be the right time for BHP or Rio to get crazy rich in the DRC.
Related
You do know who's the other partner in the JV?
Carlos Danger
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I find it best with all things regarding AVZ to deal in what can be proved. Judging by who got the most likes tho it would seem the masses still after all that’s happened prefer feel good sentiment over facts.
While we’re on the subject of people responding to emotion rather than logic I would like to wish a happy day 974 of suspension to everyone. I’m sure the licence should ‘probably’ drop any day now lol
Carlos are you still of the belief if we give up on the North we can move forward with Roche Dure ? Or words to that effect . If I remember correctly you were quite adamant the North (CDL) was the main issue .
It’s clear that the world is still very much focused on the DRC. Which is good news overall, as we have the means to irreparably tarnish their reputation on the world stage.Why the US wants BHP and Rio to get crazy rich in the Congo
Peter KerResources reporter
Jan 6, 2025 – 5.00am
If a sequel is ever made to the 2018 box office hit Crazy Rich Asians, it could well be Crazy Rich in the Democratic Republic of Congo.
American billionaire Robert Friedland owned the film production company that made the former, and his flagship copper company Ivanhoe Mines is fast achieving the latter.
Ivanhoe talisman Robert Friedland was in Sydney in November. Rhett Wyman
In the decade since Rio Tinto bought Friedland out of Mongolia’s Oyu Tolgoi copper project, the legendary explorer has found and built another of the world’s great copper mines, this time at Kamoa-Kakula in the DRC.
The dirt at Kamoa-Kakula is fabulously rich in copper and much of the power for the mine comes from carbon-free hydroelectric generators nearby.
Production has been under way for just over three years, but already Kamoa-Kakula is the world’s fourth-biggest copper producer. If expansions go to plan, it could sneak into second place by 2028
At a time when BHP and Rio are hungry for copper and pulling the trigger on acquisitions, it’s curious that Ivanhoe and Kamoa-Kakula haven’t yet caught a bid.
Compared to BHP’s highly complicated attempt to acquire Anglo American last year, a bid for Ivanhoe – which owns 39.6 per cent of Kamoa-Kakula – would be simpler to complete and should be doable at half the price.
The big Australian miners are impressed by what Friedland has created in the DRC; a delegation from Rio have visited Kamoa-Kakula, and according to those within earshot, the delegation left the DRC thinking they had seen the world’s best copper mine.
Friedland has many admirers in the boardrooms of BHP and Rio. One person who serves as a director on one such board told The Australian Financial Review they consider Friedland “a genius”.
It’s not just Friedland’s ability to find copper mines that has impressed; Friedland’s work on “pulsed power” has also got the big miners excited.
Pulsed power is a method of accumulating electrical energy over a long period then releasing it instantaneously; thereby compressing and concentrating it to deliver a greater force.
The Friedland camp reckons pulsed power could allow the mining industry to dramatically reduce the amount of energy it consumes when grinding and drilling through rock.
BHP chief executive Mike Henry was so impressed by pulsed power he bought BHP a stake in two of the Friedland companies trying to apply the technology; I-Pulse and I-Rox. Henry then made a personal appearance in a promotional video for I-Rox, describing it as a “breakthrough technology” that could “radically transform the way we go about the act of mining and processing”.
But as the deification of Friedland gathers pace, one senior executive from the big two Australian miners who sat down with the Financial Review on the condition of anonymity pointed out a fly in the ointment at Kamoa-Kakula – one that may explain why Ivanhoe has eluded potential acquirers.
It’s not so much about the DRC’s traditional reputation for sovereign risk; miners are generally encouraged by the way DRC president Félix Tshisekedi has prioritised investment into the DRC from American and European sources.
Tshisekedi has been rewarded by the US State Department for his perceived progress on human rights and anti-corruption measures, winning greater access to US markets under the Africa Growth and Opportunity Act (AGOA).
Senior people now believe the DRC is investible for the right project; an extraordinary notion given the DRC was a byword for corruption and child labour barely a decade ago. (These days, Mali is the place mining executives refuse to go, lest they be held hostage.)
Which brings us back to the perceived problem with Kamoa-Kakula: transport and logistics.
The mine is land-locked about 1700 kilometres from the coast as the crow flies.
The vast majority of the copper produced at Kamoa-Kakula over the past three years has been trucked up to 3000 kilometres to ports like Durban in South Africa, Dar es Salaam in Tanzania, Walvis Bay in Namibia or Beira in Mozambique.
A return journey from Kamoa-Kakula to Durban often took 45 days, and rose to 70 days with congestion. Border crossings in Africa only create potential for complications.
The logistical cost of getting Kamoa-Kakula’s copper to port has been approximately 30 to 40 per cent of the mine’s C1 unit cost in recent years. According to Ivanhoe’s market filings, the C1 unit costs at Kamoa-Kakula were $US1.69 per pound in the September quarter.
That’s fairly competitive with the C1 costs BHP expects in the year to June 2025 at Chile’s Escondida (between $US1.30 and $US1.60 per pound) and its South Australian copper mines (between $US1.30 and $US1.80 per pound).
Those two BHP copper hubs are 170 kilometres and 560 kilometres from port respectively, and they also have shorter shipping journeys to customers in North Asia.
Ivanhoe reports another number called “cost of sales”, which was $US1.80 per pound in the three months to September 30.
That’s nothing to be ashamed of; it makes Kamoa-Kakula a cheaper mine than BHP’s Spence asset in Chile, and many of the world’s copper mines.
Two big efforts are under way to solve Kamoa-Kakula’s transport challenges and make it a lower cost producer.
Ivanhoe and its partners are building a smelter which will allow the mine to sell copper metal with 99 per cent purity, as opposed to the concentrate containing 50 per cent copper it mostly sells today.
The smelter will fire up in 2025, and selling copper with 99 per cent purity will mean Kamoa-Kakula doesn’t waste time and money transporting waste material to customers.
Ivanhoe reckons the smelter and the product switch could cut unit costs by 20 per cent and reduce the carbon intensity of each pound of copper by 46 per cent.
The US government is also determined to solve Ivanhoe’s transportation problems, and is pumping money into a 1739 kilometre rail and logistics corridor that will connect central African mines like Kamoa-Kakula to Lobito port in Angola.
The Lobito corridor is the US and European governments’ answer to China’s Belt and Road Initiative. It is designed to get African critical minerals to market faster, and to limit Chinese dominance of them.
The DRC overtook Peru as the world’s second-biggest copper producer in 2024, and Chinese companies like CMOC and Zijin are established players in the DRC.
Zijin is Ivanhoe’s partner at Kamoa-Kakula with a 39.6 per cent stake in the mine and 12.2 per cent of Ivanhoe’s shares. Chinese giant Citic owns 22.4 per cent of Ivanhoe.
The US government would dearly love for Ivanhoe’s stake in Kamoa-Kakula to stay in allied hands, lest China take control ahead of a decade when copper demand for decarbonisation and defence infrastructure is expected to soar.
It is no coincidence that the Lobito railway passes within five kilometres of Kamoa-Kakula, and the mine was among the first users of the railway when it sent trial volumes to Lobito in 2024.
Kamoa-Kakula is signed up to ship about half of its volumes to Lobito.
BHP and Rio have been heavily encouraged by their friends in the US State Department to get acquainted with the benefits of the Lobito corridor; the US funded rail network could be extended to help BHP and New York-listed Lifezone Metals develop the Kabanga nickel project in nearby Tanzania.
US President Joe Biden even travelled to Lobito port in early December, to observe its progress and pledge more money.
By this time next year, both the new smelter at Kamoa-Kakula and the Lobito corridor will be significantly advanced, and Ivanhoe’s logistics problems will be substantially solved.
Perhaps that will be the right time for BHP or Rio to get crazy rich in the DRC.
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The best thing for us to do is to defend our rights at the ICC and ICSID (those fees need to be paid asap) - until a deal is signed, sealed and delivered, which gets us out of this sh-thole for a strong profit for all AVZ stakeholders. Or we go the whole way, and bury them and their reputation.
Comical that the AFR wrote this piece after years of piling on crap about AVZ. Short-term memory for sure
AVZ to deal with what can be proved.
Hi Carlos to your knowledge .
Can the ICC Court of Arbitration influence and put a halt on illegal minerals being exported ?
Considering the 4 major ports at Lobito
Der Es Salaam, Durban, Walvis Bay are not owned or controlled by China .
DRC is a member of ICC at the moment but once found guilty of the illegal attempt to steal Manono?
DRC and Zijin need to cut a deal otherwise China will have to build its own rail and port.
Even then higher tariffs from lithium from DRC could be imposed.
Retrobyte
Hates a beer
At least 102 men have been executed in the Democratic Republic of Congo in the past week, with another 70 still set to be killed, officials have said.
At least 102 men have been executed in the Democratic Republic of Congo in the past week, with another 70 still set to be killed, officials have said.
According to the Central African country’s Minister of Justice, the men, who were armed robbers and “urban bandits”, were executed at Angenga prison.
Last week, 45 of the men, aged 18 to 35, were killed while the remaining 57 died within the last 48 hours. A flight from Kinshasa carrying “the third batch” of prisoners has arrived at Angenga, Minister of Justice Constant Mutamba said, though it’s unclear when their execution will occur.
The Democratic Republic of Congo Armed Forces. Picture: Seros Muyisa/AFP
The DRC controversially announced in March that it was ending a 20-year moratorium on the death penalty, which it would impose and carry out in, among other offences, cases of treason, war crimes, crimes against humanity, espionage, rebellion and criminal conspiracy.
The country abolished capital punishment in 1981, and while it was later reinstated in 2006, the last execution took place in 2003.
President Felix Tshisekedi said the decision was made “with a view to ridding the DRC army of traitors on the one hand and curbing the resurgence of acts of urban terrorism resulting in the death of men on the other”.
France's President Emmanuel Macron (R) and the President of the Democratic Republic of the Congo Felix Tshisekedi (L) in April 2024. Picture: Christophe Ena/AFP
The move sparked outcry from human rights groups, with activist Espoir Muhinuka telling the Associated Press that political pressure could lead to unjust convictions and arbitrary executions.
“The situation in the DRC is complex and requires a multidimensional approach,” he said.
“The fight against urban gangs must go hand-in-hand with efforts to combat poverty, unemployment and social exclusion, which are often contributing factors to crime.”
Amnesty International’s regional director for East and Southern Africa, Tigere Chagutah, said last year that the decision endangered the lives of hundreds of people who have been sentenced to death.
“The government’s decision to reinstate executions is a gross injustice for people sentenced to death in the Democratic Republic of Congo and shows a callous disregard for the right to life,” Mr Chagutah said.“It is a huge step backwards for the country and a further sign that Tshisekedi administration is backtracking on its commitment to respect human rights.
“Whether those who have been sentenced to death are in the national army or police, in armed groups or have been involved in gang violence, everyone has a right to life and for that right to be protected.”
Surely they must have this mixed up with the other Congo. We know that in DRC the Chinese only ever act with the highest ethical standards and in full compliance with all laws and regulations.
www.bbc.com
DR Congo gold: Chinese nationals arrested with bars and $800,000 cash in Walungu
The gold and money was allegedly hidden under the seats of the vehicle they were travelling in.
They stole extra. Just incase the brown paper bag , get out of jail maneuver was needed . They will go straight to Cong's hotel for a massage, drinks , a 5 course meal with hookers , and after party .
Last edited:
CashKing
Regular
JAG’s Beach house 
Surely they must have this mixed up with the other Congo. We know that in DRC the Chinese only ever act with the highest ethical standards and in full compliance with all laws and regulations.
View attachment 75331DR Congo gold: Chinese nationals arrested with bars and $800,000 cash in Walungu
The gold and money was allegedly hidden under the seats of the vehicle they were travelling in.
Shit happens
They thought your land is my land.
I wonder why they are sitting on leather chairs for thieving from the country
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