Cablegate: Extractive Industries Update

VZCZCXRO5613
RR RUEHBZ RUEHDU RUEHGI RUEHJO RUEHMR RUEHRN
DE RUEHKI #1624 2931154
ZNR UUUUU ZZH
R 201154Z OCT 06
FM AMEMBASSY KINSHASA
TO RUEHC/SECSTATE WASHDC 5009
INFO RUEHXR/RWANDA COLLECTIVE
RUCNSAD/SOUTHERN AFRICAN DEVELOPMENT COMMUNITY
RHEBAAA/DEPT OF ENERGY WASHDC
RUEAIIA/CIA WASHDC
RUFOADA/JAC MOLESWORTH RAF MOLESWORTH UK
RHMFISS/HQ USEUCOM VAIHINGEN GE

UNCLAS KINSHASA 001624

SIPDIS

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: EPET EMIN ENRG KJUS PGOV CG
SUBJECT: EXTRACTIVE INDUSTRIES UPDATE

REF: A. KINSHASA 1500
B. KINSHASA 1364

1. (U) Summary. The extractive industries in the DRC have
recently been rocked by legal actions, public denouncements
and the deaths of several miners. Meanwhile, interest in
exploring the DRC's petroleum reserve capacities continues.
End summary.

GOLD AND DIAMOND SECTORS
------------------------

2. (U) Human Rights Watch issued a news release October 16
accusing elements of the Congolese Armed Forces (FARDC) of
forcing Ituri civilians to mine gold and perform other
involuntary tasks. This forced labor is a practice that
Ituri militias are also widely believed to have imposed upon
local populations.

3. (U) Congolese media reported the October 8 deaths of four
diggers due to the nighttime collapse of an underground
tunnel in a diamond mining pit in Western Kasai. The miners
were allegedly on the property illegally.

COPPER-COBALT SECTOR
--------------------

4. (SBU) A Congolese Military Prosecutor has issued
indictments against three expatriate former Anvil Mining
employees. The three are accused of complicity in the
company's alleged logistical support for the Congolese
military's October 2004 response to a disturbance by Mai Mai
irregulars in Kilwa, Katanga province. More than 100
villagers are estimated to have died during this clash with
the FARDC. Anvil received widespread, negative international
press attention as a result of this incident. The company has
denied involvement in acts that resulted in human rights
violations and violence, and said in an October 18 press
release that one of the named employees was not even in the
DRC at the time of the Kilwa incident.

5. (U) A Belgian court has issued an injunction forbidding
Gecamines from disclosing to third parties confidential
information and studies obtained from First Quantum in
connection with the Kipushi mine in Katanga province.
Gecamines recently launched a tender offer, and media report
that thus far it has received 23 expressions of interest
(reftel A).

PETROLEUM SECTOR
----------------

6. (SBU) A Spanish company called Nessergy Ltd. signed a
petroleum production sharing agreement with the Ministry of
Energy October 9 for rights to an area that is in Angolan
territorial waters. Although the GDRC and Angola have
discussed a joint development zone, which would give the GDRC
shared deep-sea exploration rights in Angolan territorial
waters (reftel B), DRC's Ministry of Energy officials report
little, if any, progress on this agreement over the last few
months. A Ministry of Energy petroleum expert told EconOff
he considered the deal "bizarre," and said he thinks the
company has a motive other than actually exploring, because
the sum it proposed to spend for deep-sea exploration, USD 12
million, would be inadequate to perform the task.

7. (U) The Ministry of Energy, through private companies,
plans to launch studies of DRC petroleum potential in
Bandundu and Equateur provinces the week of October 16th,
according to EconOff's contact. These areas form part of the
Central Basin, one of the DRC's three potential petroleum
reserves.
MEECE

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