Katanga orders First Quantum to shut down Kolwezi copper tailings project
Canadian miner First Quantum has had to declare force majeure on its Kolwezi copper project, as it stops construction following DRC's Katanga province order to seal facility
Posted: Wednesday , 16 Sep 2009
TORONTO (Reuters) -
First Quantum Minerals (FM.TO: Quote) said on Wednesday it has stopped construction of its Kolwezi copper project in the Democratic Republic of Congo and has declared force majeure on it, pulling the company's shares down by as much as 9 percent.
The African nation's government told First Quantum last month that, after a prolonged review, it had canceled the company's license for the project, a tailings recovery operation that had been expected to start the commissioning process in 2010, and eventually produce 70,000 tonnes of copper.
First Quantum said its decision to stop construction follows an order by the general prosecutor of Katanga province to seal the facility. The company said its lawyers have advised it that such an order is illegal.
The company said the suspension will result in about 700 local jobs being lost.
The Canadian company's shares plunged by 9 percent on the news, before rebounding a bit. At mid-morning, they were down C$4.12, or 5.5 percent, at C$70.66 on the Toronto Stock Exchange.
($1=$1.07 Canadian) (Reporting by Cameron French; editing by Peter Galloway)
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