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The (Bidding?) War For the DRC

Every few years the Democratic Republic of the Congo rises to international attention. Often this is due to a new round of fighting in the eastern regions of the country, with associated human rights violations. This time, however, Congo’s resources are in the spotlight as nations scramble to secure access to some of the world’s largest and richest deposits of critical minerals ranging from battery metals to rare earths, gallium, germanium, and others vital to “green” economies, national defense, and slowing climate change.

The major “bidders” at the moment include China, Saudi Arabia, and the United Arab Emirates. China of course has been present in the DRC for decades in the mining industry with activities ranging from blatently illegal to merely controversial, as is the case with Tenke Fungurume, one of the world’s largest copper and cobalt mines. In 2006 China entered into an “infrastructure for minerals” agreement with the then-government of Joseph Kabila. Under the terms of this agreement, China built some roads, repaired some airport tarmacs and some government buildings – mostly in the eastern part of the country and in the mineral rich Katanga province. The Congolese people were unhappy with these arrangements as few jobs were created and those which were, involved menial labor. Due to the cheap materials used several projects were of short duration: perhaps the most famous was the road connecting the Bukavu airport with the city, which began eroding and collapsing in places even before the entire project was completed. In exchange, China received some of the richest copper concessions in the Katanga province and rights to other mineral holdings throughout DRC. In 2022 China’s Zijin Mining Group launched a bid to take over the Manono lithium/tin concession being developed by an Australian company and in 2023 was awarded development rights when the DRC government said the Australians had been moving too slowly. The award was revoked, however, and China now is contesting that decision.

In 2021 Saudi Arabia signed a general cooperation agreement with the Tshisekedi government and in January 2024, at the Future Minerals Forum in Riyadh, the two countries signed an MOU governing cooperation in developing Congo’s mineral wealth. Through its Private Investment Fund (PIF) Saudi has established a new vehicle, Manera Minerals, 50% owned by PIF and 50% by the state-owned mining company Ma’aden to actively work on sourcing critical minerals outside of Saudi to support the Saudi 2030 transformative development vision. Manera is charged with taking equity positions in existing companies thereby accelerating Saudi’s access to critical minerals. Unlike the Chinese, the Saudis enjoy a positive public perception. Saudi is seen as a role model and teacher for utilizing natural resources to enrich and develop countries – a major goal for African nations – and also has the resources to invest even during market downturns when commodity companies tend to pull back, thereby ensuring that projects continue to be developed regardless of external pricing constraints. Saudi’s recent agreement with the DRC envisions up to $2 billion in investments in the mining, transportation and infrastructure sectors. Crucially, the MOU envisions investment in processing and refinement of mined products, supporting a long-desired value-add for Congolese mining.

In 2023 the UAE signed a $2 billion deal with one of the DRC’s state mining companies, Sakima, to develop up to 4 mines in South Kivu and Maniema provinces. Sakima has mining concessions for tin, tantalum, tungsten and gold in those areas: another state-owned company, Gecamines, controls copper in Katanga. This broader agreement followed an initial partnership for Primera Group, a UAE firm, to export at preferential rates artisanally-mined gold, coltan, tin, tantalum and tungsten. This agreement supports the DRC Government’s desire to professionalize artisanal mining and ensure miners are getting a better return for their efforts. The DRC also hopes the deal will help strangle access by the militias to the area and cut-off their access to funds supporting continued violence in Eastern Congo.

Russia also is stepping up its interest in the DRC. Russians, like Chinese, have been in the Congo for decades mostly smuggling arms into, and minerals out of, Eastern DRC. Elements of the Wagner Group reportedly had trained and partnered with some of the militias in the area to more directly (albeit still illegally) exploit Congo’s mineral wealth.  In the last six months, following the death of Wagner Group leader Yevgeny Prigozhin, Russian military activities have increased and Russian political influence is emerging. The recent civil unrest in DRC’s capital, Kinshasa, which saw several days of sometimes violent demonstrations in front of the US and European Embassies as well as the UN offices, is believed to have been spurred by Russia. During the Cold War in the 1960’s the DRC had been a strategic site for both the US and Russia: as a bid to keep Russia from increasing its influence in DRC the US supported the rise of then-Sargent Mobutu. It appears that access to critical minerals in the DRC may be fueling another Cold War-style intervention in Africa by Russia – which has offered its military support to several African countries to enable governments to “suppress unrest.”

Meanwhile, what are the US and European countries doing? Very little. Even though by some estimates approximately 70% of the crucial critical minerals are in an arc spanning Central Asia to Africa, and even though in many countries the US remains the preferred partner (when possible) there, so far has been little apparent effort to support US businesses to develop and secure the resources needed for economic transformation and national defense.




Move Over China, as Saudi Arabia Enters the Critical Minerals Stage in the Congo

The Democratic Republic of Congo (DRC) is rapidly emerging as a focal point for global entities eager to obtain crucial metals pivotal for green technologies. This surge in interest has placed both the United States and the mining giant, Glencore PLC (LSE: GLEN | OTC: GLCNF | HK: 805), at the forefront of news, particularly regarding their expanding interests in the DRC.

Recent reports from Reuters reveal advanced talks between the United States and Saudi Arabia to secure metals from Africa for their green energy transitions. Concurrently, the UAE has penned a $1.5 billion agreement with the DRC to mine and process critical materials. This raises significant queries: Is Saudi Arabia charting a similar trajectory? How will these accords impact the region’s fragile power infrastructure? Moreover, given the proposed framework allowing U.S. companies to purchase a part of Saudi’s yield, what might be the potential cost for U.S. entities? This arrangement, echoing the prevalent market control where U.S. miners and manufacturers are tethered to China’s market hegemony, prompts the contemplation: Is the U.S. merely substituting China with Saudi Arabia?

In a parallel move, the Financial Times has shed light on Glencore’s ambitions in the DRC. The corporation’s strategy is to fortify its stance in the electric vehicle battery domain by bolstering its investments in the African country. Their alliance with the Toronto-listed Tantalex Lithium Resources Corp. (CSE: TTX | OTCQB: TTLXF) for a lithium mining project epitomizes this vision. Nevertheless, Glencore’s African endeavors have not been without their share of scandals. In the previous year, they acknowledged bribery practices across the continent, culminating in a sizable $180 million settlement with the DRC. Probes into their DRC activities persist.

Critical Minerals Institute (CMI) Director and DRC expert Melissa “Mel” Sanderson’s discernment provides a deeper layer of scrutiny to these advancements. She underscores the ethical paradox in the U.S.’s methodology — a predisposition for mining in regions with more lenient ESG standards, while overlooking potential ventures domestically under more rigorous norms. She perceives this as a manifestation of an “out of sight, out of mind” philosophy.

Enriching the discourse, CMI Co-Chair Jack Lifton remarked, “I am deeply acquainted with this scenario. The American public remains oblivious to the fact that the lithium will be claimed by the highest bidder, not necessarily the most ethical. The Chinese had collaborated with an Australian firm that forfeited the concession due to alleged “corruption.” It’s plausible that they will, if not already, synergize with Glencore concerning expenses. Being Swiss, Glencore isn’t bound by loyalty to the EU or the USA. It’s widely recollected that an African leader observed, ‘While Americans offer promises, the Chinese construct airports.’ The U.S. and its industries are channeling funds into ‘domestic’ ventures from finite or economically precarious sources, providing fertile ground for unscrupulous practices.”

In today’s interconnected age, cultivating global alliances is undeniably pivotal. Yet, the overarching strategic, ethical, and environmental repercussions of these engagements demand unwavering attention. As the global compass aligns with sustainability, it becomes imperative for entities like the U.S. government and Glencore to holistically evaluate the broader socio-political and environmental consequences inherent in their decisions. Reflecting upon this might hint that ethical, sustainable, and dependable alternatives may be more accessible than they presume. For more information on the CMI, click here




How the Current State of Critical Mineral Supplies in the DRC Impacts the US

In an InvestorIntel interview with the Critical Minerals Institute Chairman Jack Lifton, Melissa Sanderson, the President of North America and Director of American Rare Earths Limited (ASX: ARR | OTCQB: ARRNF), discussed the current state of critical minerals in the Democratic Republic of the Congo (DRC) and how it impacts the United States. Sanderson highlighted recent legislation that tackles human rights violations, UN peacekeeping missions, economic potential, and corruption in the DRC. The legislation also proposes a US Geological Service study to identify the types and quantities of critical materials present in the DRC and calls for an increase in embassy staffing in Kinshasa, including rare earth expertise, to facilitate US businesses’ entry into the Congo.

However, Sanderson noted a divergence between Washington’s approach and the DRC’s expectations. The latter seeks tangible investments rather than studies or moral suasion. She highlighted the UAE’s $9 billion agreement with the Congolese government for mining sector development as a significant move. This places the UAE in direct competition with China, which currently dominates the global rare earth production and has a substantial influence in the DRC. While the US hopes for reduced corruption and improved conditions for its businesses, it remains hesitant to invest in the Congo…to access the full interview, click here

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About American Rare Earths Limited

American Rare Earths (ASX: ARR | OTCQB: ARRNF | FSE: 1BHA) is a leading explorer and developer of rare earth elements with a strong focus on developing sustainable and cost-effective extraction and processing methods. The company’s projects, including Halleck Creek in Wyoming, La Paz in Arizona, and Searchlight in Nevada, hold significant potential to become major rare earth production sites in North America.

To know more about American Rare Earths Limited, click here

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Mint Corporation’s CEO on servicing the needs of the underbanked globally

June 20, 2018 – “The underbanked market globally is a $2 billion plus market. We as Canadians are used to having bank accounts, but that is not the case in a number of parts of the world. Having access to financial services is the stepping stone for improving the quality of life for a vast majority of the people. You need a different business model with a different technology platform to go after this market and that is what we have built.” states Vishy Karamadam, Chairman and CEO of The Mint Corporation (TSXV: MIT), in an interview with InvestorIntel Corp. CEO Tracy Weslosky.

Tracy Weslosky: I am going to get right into it because I have never seen a company achieve so many significant milestones ever in so short a period. Let us start with, who is The Mint Corporation? Just give us a bit of an overview.

Vishy Karamadam: Mint is a globally certified payments platform company. We have built a fully certified PCI compliant, which is the industry standard, payments platform capable to issue Mastercard and China Union Pay, the world’s leading global brands. We have built a mobile payment infrastructure connected to our payments platform to service the needs of the underbanked globally.

Tracy Weslosky: Okay, servicing the needs of the underbanked globally. Honestly have not seen anything like this on the Toronto Stock Exchange. Very interesting so back me up, how big is this market? 

Vishy Karamadam: The underbanked market globally is a $2 billion plus market. We as Canadians are used to having bank accounts, but that is not the case in a number of parts of the world. Having access to financial services is the stepping stone for improving the quality of life for a vast majority of the people. You need a different business model with a different technology platform to go after this market and that is what we have built…to access the complete interview, click here

Disclaimer: The Mint Corporation is an advertorial member of InvestorIntel Corp.