October 26, 2016 / 3:01 AM / 2 years ago

Congo urged to release contract on Metalkol stake sale

KINSHASA, Oct 26 (Reuters) - The U.S.-based Carter Center called on Congo to release the contract for state miner Gecamines’ sale, reported by the media, of a 25 percent stake in the Metalkol copper project to a wholly owned subsidiary of Eurasian Resources Group.

Democratic Republic of Congo’s mines minister, Gecamines and Eurasian Resources did not respond immediately to requests for comment.

Bloomberg News reported the sale on Monday of the stake in April to Highwind Properties Ltd, a Eurasian Resources subsidiary, citing the minutes of an August meeting of Metalkol’s board. It quoted a Eurasian spokesman as declining to comment on the transaction but insisting the company complied with all laws and reporting requirements.

The sale was not publicly announced and the contract was not published within 60 days of the transaction as required by a 2011 government decree.

“The Metalkol asset sale is the latest in a growing list of undisclosed Gecamines transactions,” Daniel Mulé, the extractive industries governance program manager at the Atlanta-based Carter Center, said in a statement.

“It is essential that the government immediately release the contracts for the sale of the Metalkol stakes and other undisclosed transactions for which the government-mandated 60-day publication deadline has long passed.”

Eurasian Resources, then called Eurasian Natural Resources Corp., delisted from the London Stock Exchange in 2013. But according to a filing in 2012, it held a 70 percent stake in the Metalkol project.

The Congolese state at the time owned five percent and continues to do so.

Transparency gaps have long plagued Congo’s mining sector. According to the Africa Progress Panel, headed by former U.N. Secretary General Kofi Annan, Congo lost out on at least $1.36 billion in potential tax revenue between 2010 and 2012 in five mining deals.

The International Monetary Fund called off a $530 million loan programme in 2012 when the government failed to provide sufficient details on the sale of mining assets.

Congo, which mined nearly 1 million tonnes of copper in 2015, is Africa’s largest producer of the metal and also extracts significant quantities of gold, diamonds, cobalt and tin.

Reporting By Aaron Ross; Editing by Joe Bavier and Cynthia Osterman

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