Moto Goldmines faces uncertain future in DRC review

Moto Goldmines Ltd, the exploration and development company with an interest in the famous Moto Gold Project in the Democratic Republic of Congo (DRC), has completed a feasibility study on the project.

Moto owns 60% of the project through its Border Energy subsidiary and while the outcome of the study has been positive, the company is still awaiting the findings of a review of mining agreements being carried out by the Government of the DRC.

Earlier this year, the deputy mines minister, Victor Kasongo, publicly stated that a protocol that awarded Moto the consolidated lease agreement was not legal and could be cancelled.

Recently, the company conceded that it may be required enter discussions with OKIMO (the state-owned mining company that owns 30% of the Moto Gold Project) or the Government, with regards to its rights in the project.

Moto is planning an investment of $483 million in the mine, which is which is located in northeastern DRC and expected to produce 400,000 ounces of gold a year.

However, on Friday of last week, the company voiced concerns that the outcome of the review would impair “the Group’s security of tenure and its ability to secure additional financing in the future” and that “this could have a material adverse effect on the Moto Group’s business, operating results and financial position”.