Glencore Xstrata Revises DRC Plans To Reduce Costs
News: Swiss mining company Glencore Xstrata has developed a new exploration plan for its Zanaga iron ore project in the Democratic Republic of The Congo , which will reduce the project ' s capital expenditure requirements, Mineweb reports. The project, which is being developed with local mining firm Zanaga Iron Ore Company , is now expected to cost betwe en CHF2.3 bn (US$2.5bn) and CHF 2.8bn ( US$3bn ) to develop, instead of the CHF6.9bn ( US$7.4bn ) previously planned.
BMI View: The Democratic Republic of the Congo (DRC)'s vast mineral resources will continue to attract greater international interest, given the country's huge untapped and high-grade reserves and improving, though still very poor, business environment. In terms of growth potential, the industry is one of the most attractive in Sub-Saharan Africa (SSA). We forecast the value of the sector to rise sharply from 2011 levels to US$2.5bn in 2017, mostly driven by copper and gold production. However, while we expect substantial growth in mining output, risks to investment remain numerous, with security concerns and the lack of adequate infrastructure most pressing.