May 22, 2010 / 7:54 PM / 10 years ago

UPDATE 1-Congo court overturns First Quantum mine rights

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LUBUMBASHI, Democratic Republic of Congo, May 22 (Reuters) - Congo’s Supreme Court has ruled against Canadian miner First Quantum Mineral’s (FM.TO) rights to two copper mines in the south of the country, a mining ministry official said on Saturday.

“The Supreme Court has decided to annul the letter from the ministry of mines that gave the mining title rights to First Quantum for Frontier and Lonshi,” Alexis Mikandji, chief of staff in the Ministry of Mines, told Reuters on Saturday.

Mikandji said the notification, delivered on Friday, stated First Quantum should have obtained a decree and not a letter for its two mines, whose rights are claimed by stated entity Societe de Developpement Industriel et Minier du Congo (Sodimico).

“First Quantum has the right to defend itself,” said Mikandji, who was in the southern town of Lubumbashi for a mining conference.

First Quantum began operations at the Frontier mine in November 2007 after a capital investment of $226 million.

First Quantum senior executive in Congo, Mike Parker, told Reuters the company disputed the ruling and was “vigorously defending” its right to the titles.

“We obtained our rights through the normal mining law — we applied for research permits which we obtained as early as 2000,” said Parker of arrangements before a 2002 Mining Code, arguing it did not need a decree.

First Quantum is already in a dispute with Congo over its $700 million investment in its Kingamyambo Musonoi Tailings (KMT) mining project, after a government review of mining contracts closed the mine last September, prompting First Quantum to seek international arbitration.

Reporting by Katrina Manson; editing by Mark John and Michael Roddy

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