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Kazakh miner ERG rejects preventing Congo subcontracting laws

Kazakh miner Eurasian Resources Group (ERG) has rejected accusations it attempted to bypass Democratic Republic of Congo's subcontracting laws designed to increase local ownership in the mining sector, job creation, and benefits to the nation's economy.

In a declaration released last week, Congo's federal government accused ERG of passing off 9 subcontracting companies as majority partners with fictitious shares in order to circumvent legislation requiring that Congolese investors own 50% of subcontracting shares.

The Regulatory Authority for Farming Out in the Personal Sector, a government body, stated that more than $535 million in sales had actually incorrectly gone to foreign-owned subcontractors in 2023.

It said it would take proper steps followed by exemplary sanctions against what it referred to as the proven. cases of scams.

The scams has been found within ERG's possessions. Metalkol, Comide, Frontier, Boss Mining and its subcontractors. Rocada, Roche Solide, Standar Fiable, Technologies Global,. Etalon SA, Surtek, Socom, Transversal and Vision, the regulator. said.

On Wednesday, ERG responded to the allegations, specifying that. the subcontractors were not directly related to it.

ERG unconditionally rejects any participation in illicit. activities, the business stated in a declaration, including that it has. been exchanging information with the regulative authority.

Luxembourg-Based ERG is owned collectively by 3 private. investors and the federal government of Kazakhstan which has the. remaining 40% stake.

The firm is dealing with determined disparities in agreements. with providers discovered ineligible under suitable laws, and. actively seeking option suppliers, ERG said.

Congo state miner Gecamines stated in February it had made an. offer to purchase 3 of ERG's copper and cobalt possessions in the. country.

(source: Reuters)