The Democratic Republic of Congo’s economic fortunes are inextricably linked to its mining sector. According to recent reports, mining currently accounts for 80% of the country’s export revenue. One study by African Business Magazine in 2009 estimated the country’s untapped natural resources wealth at a staggering $24-trillion, nearly eight times the GDP of the entire African continent today.
International investors have taken notice: between 2010 and 2014, foreign investment grew by an annual average of 23.6%. Current estimates place investment in new mining projects between 2015 and 2018 at $2.5-billion.
Growth forecast, with one caveat
Based on recent analyst predictions, this growth is set to continue over the next five years, especially in gold, copper, and cobalt. According to BMI, global copper mine production is forecast to increase by an average yearly rate of 4.1% between 2017 and 2021, from 20m tonnes in 2017 to 23.7m tonnes by 2021. The DRC will concurrently regain a global copper ore market share of 5% by 2021.
Other natural resources are equally promising. Cobalt, for example, presents a huge growth area, as it is used in the production of rechargeable batteries for devices ranging from smartphones to Tesla’s electric vehicles. The DRC currently has 50% of the world’s cobalt reserves, with one mining company even investing $1billion in a single cobalt mining project in the country.
However rosy the outlook for the DRC’s mining sector may be, one key factor is threatening the sector’s potential to stimulate economic growth: unreliable electricity supply.
No lights, no action
Since 2008, electricity capacity has remained fairly stagnant at 2400MW, of which a mere 1281MW is operational. And despite the government identifying 217 sites for new hydro power generation – which already accounts for 99% of the country’s power generating capacity – not a single site has been developed. Today, only 16% of the country’s more than 82 million citizens have access to electricity.
Many mining operators have also initiated their own power and hydro projects in order to secure a reliable power supply for uninterrupted productivity. However, for the DRC’s mining sector to thrive and deliver on the economic promise it holds, new thinking around the provision of power is needed.
We’ve looked at innovative new approaches to ensuring short-term power supply to drive the DRC’s mining sector and economic growth. If you are planning a mining operation in the DRC, why not start by ensuring you have the reliable power supply you need to ensure optimal ROI for your company – and your investors.
Connect with me, Grant Berndsen, via firstname.lastname@example.org