Business Plans For Small-Scale Mining in The Democratic Republic of The Congo

Business plans for small-scale mining in the
Democratic Republic of the Congo
CTC - training of mining cooperatives and

state services in the province of South Kivu
Nathalie Sterbik – [email protected]

Contents
1) Mining in the DRC

2) Artisanal and Small-scale Mining
3) CTC-Project
4) Needs for capacity building
5) Need for attracting capital
6) Example of the Kalimbi Mine
7) Lessons learned
Mining in the Democratic Republic of the Congo
CTC
Project
area
Sterbik Nathalie - AIMS Aachen – May 28th, 2015

Mining in the Democratic Republic of the Congo
DRC depends heavily on

Abt. 28 bn USD its mining sector
the GDP
Share of
Mining
44%
Others  55,8% of its GDP
56%
 77,3% of its goods exports
 1/6th of formal employment
DRC share Cobalt Diamonds Tin

of the 65,6% 15,2% 1,4%
world
production Tantal Copper Gold
(2012) 21,5% 3,4% 0,97%

Importance of Artisanal and Small-scale Mining in DRC
900,000 people work in ASM (est. 8% of the Congolese population

depends directly or indirectly on it)
80% of the tantalum and tin production, 95% of the diamonds
(2005-2007)
18%
Distribution
of mining
employment MSM-LSM
in DRC ASM
82%

Difficulties of the ASM sector in DRC
Poor OHS and working conditions
Low productivity
Difficult market access
Negative impacts on the social and natural environment
Still linked to armed groups and violence

The conflict minerals issue: 3T and Gold

BGR project in DRC
Project: Certified Trading Chains – a national

certification mechanism
Partners: Ministry of Mines, DRC; and its
relevant departments and services in the Eastern
provinces.
Goals (2009-2021):
 Control of the Mining Sector in Eastern Congo
 Formalization and Legalisation of Artisanal Mining
 Increase of Tax Revenue from Mining Sector
Based on 5 principles: transparency and
traceability, working conditions, OHS, community
development and environment

CTC Successes
 Products
(http://www.fairphone.com/)
CTC Compliant
 Mine in South Kivu (Kalimbi)
[Tin for Fairphone]
 Mine in Katanga (Mayi Baridi)
[Tantalum for Fairphone]
 Mine in North Kivu (Bibatama)
CTC Baseline audits

 7 Audits since 2012
 15 Audits in 2015
Nathalie Sterbik, BGR

Hannover, 13.11.2014
Needs for capacity building for state services and cooperatives
Occupational Health and Safety
Ventilation of underground workings
Roof and Ground control in underground workings
Drainage of underground workings
Mineral processing
Environment protection
Insufficient operational planning

Attracting capital for mining cooperatives via good business plans
Clarify Make a general inventory of their

business situation
idea and
goals
Establish a course of activities

Business
Measure plans Plan to
progress attain
over time Decision- objectives
making tools Seek financing through investors,
banks or donors
Weaknes
ses of the Formalize into small-scale mines
business and increase their overall socio-
idea economic level

Example of the Kalimbi mine
Presentation Geography Mining Reserves Future Necessary

of the and geology history and and development investments
cooperative of the mine activities resources of the mine and returns

Lessons learned for the BGR
Training well received by participants

Overestimation of turnover and underestimation of capital and
operating costs
 Insist more on cash flow planning
Lack of knowledge about quantity and quality of the
reserves/resources
 Offer support in prospecting and exploration
Lack of understanding of commodity price fluctuations and investment
conditions, as well as sustainability
 More training about mining economy relevant issues

Conclusion and outlook
Business plans are an important first step for mining cooperatives in

order to develop business ideas and to attract capital
Holistic business plans generate possibilities to include safety and
environmental aspects early in the planning
Improvement of ASM planning capacities and increase of self
confidence
Build trust between the different actors (gov. services, NGOs, ASM
sector, banks) especially for DRC
Sensitize local microfinance institutions to issues of ASM
Create opportunities for investors, banks or donors
Provide transition possibilities to other livelihoods

Thank you for your attention!
Contacts:
[email protected]
[email protected]
[email protected]

References
Berke C., Martin N., Pulkowski J., Vasters J. and Wagner M.: Rohstoffe in der
DR Kongo, Potenziale für die Entwicklung? Kfw Entwicklungsbank and BGR,
2007, 111p
BGR: Vorkommen und Produktion mineralischer Rohstoffe – ein
Ländervergleich, BGR Publications, 2014, 132p, available on www.deutsche-
rohstoffagentur.de
Oxford Policy Management: The impact of mining in the Democratic Republic
of Congo, Performance to date and future challenges, OPM with synergy,
October 2013, 34p
SNL Metals & Mining: Raw Materials Data, Stockholm, databank, 2015
UN Group of Experts: Final Report on the Democratic Republic of the Congo,
Letter dated 12.12.2013, Resolution 1533 (2004), 51p
Vasters J.: Problemanalyse des Artisanalen- und Kleinbergbausektors, BGR
internal report, 2010, 11p
World Bank, forthcoming report on DRC, June 2015

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Business plans for small-scale mining in the

Democratic Republic of the Congo

CTC - training of mining cooperatives and

Nathalie Sterbik – [email protected]

1) Mining in the DRC

Sterbik Nathalie - AIMS Aachen – May 28th, 2015

DRC depends heavily on

DRC share Cobalt Diamonds Tin

Sterbik Nathalie - AIMS Aachen – May 28th, 2015

900,000 people work in ASM (est. 8% of the Congolese population

Sterbik Nathalie - AIMS Aachen – May 28th, 2015

Sterbik Nathalie - AIMS Aachen – May 28th, 2015

Sterbik Nathalie - AIMS Aachen – May 28th, 2015

Project: Certified Trading Chains – a national

Sterbik Nathalie - AIMS Aachen – May 28th, 2015

CTC Baseline audits

Nathalie Sterbik, BGR

Sterbik Nathalie - AIMS Aachen – May 28th, 2015

Clarify Make a general inventory of their

Establish a course of activities

Sterbik Nathalie - AIMS Aachen – May 28th, 2015

Presentation Geography Mining Reserves Future Necessary

Sterbik Nathalie - AIMS Aachen – May 28th, 2015

Training well received by participants

Sterbik Nathalie - AIMS Aachen – May 28th, 2015

Business plans are an important first step for mining cooperatives in

Sterbik Nathalie - AIMS Aachen – May 28th, 2015

Sterbik Nathalie - AIMS Aachen – May 28th, 2015

Sterbik Nathalie - AIMS Aachen – May 28th, 2015

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