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The licence is renewable thereafter for an additional period of five years, providing certain conditions are satisfied. “
From the above article:
MINING RIGHTS AND REQUIRED LICENCES AND PERMITS
i Introduction
Underground minerals belong exclusively to the state. However, any private party may be authorised by the state to engage in mining activities (from exploration to exploitation and distribution), provided that specific objectives of eligibility, priority and capacity criteria set forth in the Mining Code are met. The types of mining permits available in the DRC are research permits, exploitation permits (including small-scale mines) and tailing exploitation permits. Specific legislation regarding artisanal mining and quarry rights also exists.
Companies that wish to develop mining activities in the DRC are required either to incorporate a Congolese company or to elect domicile with a 'mining agent' as a condition of eligibility to obtain an exploitation permit. In addition, to be eligible for a mining permit, companies are obliged to either form a joint venture with a state-owned company (such as Gécamines) that already holds the necessary permits, or freely assign a mandatory 10 per cent stake of its share capital to the DRC.
ii Surface and mining rights
Any person wishing to engage in prospecting or reconnaissance activities must make a prior declaration to the Mining Cadastre and seek a prospecting permit. This permit entails no priority whatsoever in relation to potential future exploration or exploitation rights.
An exploration permit may be granted to any eligible private company for a period of five years, renewable once for the same duration, with respect to all mineral substances (Article 52). To be eligible for an exploration permit, a company must demonstrate a minimum financial capacity of at least five times the total amount of the annual surface rights payable for the area covered by the exploration permit (Article 58). The surface rights amount to US$5.89 per square metre (Article 397). In addition, the company will have to submit a rehabilitation and mitigation plan before starting any research activity. There are specific obligations for maintaining the permit, including the requirement to start exploration work within one year of delivery of the permit (Article 197).
Should the holder of a research permit demonstrate through a feasibility study the existence of an economically workable ore deposit (including tailings, for which specific permits exist) and sufficient financial capacity for the development, construction and exploitation of a mine, the Minister of Mines may grant an exploitation permit for a duration of 25 years, renewable for successive periods of 15 years. The exploitation permit may be refused by the Minister of Mines only for specific reasons, which are exhaustively listed in the Mining Code. Obtaining an exploitation permit obliges the operator to transfer to the state a free carry participation of 10 per cent of the operator's share capital (Article 71). In practice, however, operators that are engaged in joint ventures with state-owned permit holders, such as Gécamines, are not required to transfer 10 per cent of their share capital to the state.
In addition to exploration and exploitation permits, the Mining Code contains specific provisions with respect to artisanal or small to very small-scale mining rights, and quarry rights. Quarry rights relate to construction materials rather than mineral substances.
The timeline for obtaining an exploration or exploitation permit is as follows.
The Mining Cadastre has 20 working days to examine the request and to make a decision (Article 40). Following this, the Directorate of Mines must conduct a technical investigation. The office in charge of the protection of the environment examines the environmental impact study and the environment management plan. These reviews must be conducted within a period of time set forth in the Mining Code for each type of request (typically, for exploitation permits, within 30 working days for the Mining Cadastre, 60 working days for the Mining Directorate and 180 working days for the environmental investigation). Should any of the aforementioned authorities fail to reach a decision within the required time frame imposed by the Mining Code, the mining permit will be considered granted.
When a favourable decision is made, the Mining Cadastre will then grant the mining permit to the applicant, provided that the relevant surface rights have been paid for within 30 business days.
All mining rights are conveyable under the Mining Code. A specific right of amodiation (comparable to a long lease agreement) also entitles the holder of an exploitation permit to transfer all or part of such rights under a rental scheme. Exploitation permits can also be mortgaged. Finally, while mining rights are valid only for specified mineral substances, permits can be extended to additional minerals through specific procedures.
iii Additional permits and licences
Processors of mineral substances who do not hold mining rights and whose activities are limited to processing activities must obtain a specific licence in this respect pursuant to the Mining Code.
iv Closure and remediation of mining projects
The holder of a research permit will also have to submit a rehabilitation plan for the site after its closure to be eligible for an exploitation permit. The closure of a research or exploitation centre must be promptly notified to the Mining Administration.
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The holder of the mining rights is required to obtain a financial guarantee in an amount sufficient to carry out environmental rehabilitation.
IV ENVIRONMENTAL AND LABOUR CONSIDERATIONS
i Environmental, health and safety regulations
The New Mining Code and the Mining Regulations contain several environmental and health and safety regulations. Environmental regulations are by far the most detailed.
While most health and safety regulations are contained in the Congolese Labour Code, and are therefore not specific to the mining sector, the Mining Regulations do contain specific safety directives regarding the use of explosives.
In order to conduct mining operations, an Environmental Exploitation Permit from the Ministry of the Environment is mandatory, in addition to the environmental obligations arising from the New Mining Code.
ii Environmental compliance
Environmental compliance obligations exist at every stage of a mining project:
- the holder of an exploration permit must apply for the approval of a mitigation and rehabilitation plan in which the measures taken to limit and remedy environmental damage caused by exploration work are described;
- any person applying for an exploitation permit is required to submit an environmental impact study and a project environmental management plan, which must contain a description of the 'greenfield' ecosystem and of the measures envisaged to limit and remedy harm caused to the environment throughout the duration of the project; and
- to be granted an environmental exploitation permit, the holder of a mining right is required to submit an environmental impact study and an environment management plan to the Ministry of the Environment for approval.9
As mentioned above, rehabilitation costs must be covered by a financial guarantee to be set up in accordance with the Mining Regulations.
iii Third-party rights
Under the Mining Code, occupants of the land covered by a mining permit have a right to be indemnified when their activities (such as agriculture) are affected by a mining project, in accordance with the conditions set out in the New Mining Code.
Other rights include an obligation for the operator to consult with local authorities.
Additional provisions of the New Mining Code are intended to ensure the conservation of any archaeological findings that occur during the course of the project.
iv Additional considerations
Generally speaking, the DRC's infrastructure is either outdated or non-existent.
In order to develop and maintain activities and personnel, mining operators are therefore frequently required to participate in local development, for instance by funding roadworks, hospitals or schools.
This last paragraph might be what Zijin were contesting re AVZ’s lack of local development of roads, hospitals schools to date, however you would think this only applies once you have a mining licence, not merely an exploration permit to a tenement.
