Mwana Africa - A New beginning

hehe, strong support from DRC-gouverment / kabila / Miba

Same story like gecamines in the copper sector


December 21, 2006
Government of DRC Revokes Diamond Licences Of Small Companies Which Have Not Complied With Regulations


An interesting note has appeared from analyst John Meyer at Numis Securities which confirms that First Quantum Minerals is not on the Congo Government list to have any mining licences revoked. Many investors will not be aware that there was such a possibility, and it turns out today's statement is principally aimed at small diamond companies which have not maintained payments for licences. The Congo operates a 'use-it-or-lose-it' policy with regard to licences. Congolese Minister of Mines Mathieu Kalele has said in an interview with Dow Jones that 45 mines of 75 operating in the DRC have been given a five-day deadline to comply with environmental and social laws, or be stripped of their mining licences.

This could be good news for Mwana Africa which has been building up its diamond interests in the DRC in recent months . Back in May it acquired Sibeka which has a 20 per cent interest in Societe Miniere de Bakwanga (MIBA) whose other shareholder is the Government of DRC. It does not need much imagination to see that MIBA is likely to be in pole position to pick up any of these revoked licences. MIBA has produced an average of 6 million carats of diamonds/year over the past five years and its geological reserves should enable it to jack up production from its Mbuji Mayi operations.

Following this deal Mwana Africa is now acquiring Gravity Diamonds which is exploring for diamonds in Australia and the DRC with BHP Billiton as its major shareholder and alliance partner. In the DRC, Gravity is exploring for diamonds on the Kasai craton, one of the most prospective diamond terrains in the world that remains relatively unexplored by modern exploration methods. The Kasai terrain is the northeasterly extension of the Angolan diamond fields where there are numerous known diamondiferous kimberlite pipes and widespread alluvial mining over the border.

The DRC is historically one of the world’s largest diamond producers although most of the production comes from artisanal alluvial mining, with only one known diamondiferous kimberlite mine at Mbuji Mayi which is owned by MIBA.. Through a successful, widespread program of reconnaissance kimberlitic indicator mineral sampling carried out over the past two years, Gravity Diamonds has identified four highly prospective areas from which it is recovering coarse grained indicator minerals and diamonds that indicate close proximity to diamondiferous kimberlite pipes and it is moving rapidly towards target testing.

The mines operated by MIBA are in a sorry state and expertise and funding from Mwana Africa/Gravity Diamonds should go a long way to get them on track and expanding once again. This point will not be lost on the government of DRC and doubtless Kalaa Mpinga, the chief executive of Mwana Africa, will have rammed the point home. Kalaa Mpinga is a citizen of DRC and the son of a premier of Zaire before it became DRC. He spent a long time with Anglo American before getting involved with Mwana Africa. He has the ears of all politicians in the region, understands mining and sees things from an African point of view.

Minews managed to make contact with Oliver Baring, chairman of the company, who was on a train somewhere in France. He would not be drawn too far on the revoking of diamond licences in DRC, but admitted that it should be good news for Mwana Africa. If nothing else it should remind investors that his company is building its diamond interests in DRC as the current share rating indicates that the potential from this has been overlooked.