Teekay Tankers Ltd V.TNK

RE: Why oh why...

[vsniffel]

NEW YORK (Reuters) - U.S. copper giant Phelps Dodge said on Thursday it was close to getting approval for a deal to develop the vast mineral-rich Tenke Fungurume deposit in the Democratic Republic of Congo. If Phelps Dodge's gamble pays off in the volatile African nation, the world's second-largest copper producer will get access to one of the world's largest known copper-cobalt deposits and succeed where others have failed. "We are hopeful in the next few months we will get formal approval from the government to allow the partnership to go forward," Steve Whisler, Phelps's CEO, told the Reuters Mining Summit. The venture with Lundin Holdings and state-owned producer Gecamines would give Phelps some 63 percent of the project in which it aims to initially invest $100 million to $150 million. "We haven't finalized the size of the plant nor have we finalized what our potential investment will be. If it all fell into place it could be in production in late 2007, early 2008," Whisler said at the summit held at Reuters' offices in New York. "We plan to start relatively modestly -- initially probably looking at a plant size of 100 million to 200 million lbs annual production, but given the reserve base it could be something substantially larger than that." The Congo's treasure trove of natural resources has attracted a succession of foreign companies over the years who believe the prize is worth the political risk. "You have to take a portfolio approach so that if you do lose it all, it does not sink the company," he said. Congo's copper and cobalt output has been in decline after years of plundering under the Mobuto Sese Seko regime and subsequent war and other violence. Mobutu's insatiable appetite for money destroyed the Congo's copper-mining industry. Copper production plummeted from a peak of almost 500,000 tons a year in the mid-1970s to some 50,000 tons in 2003. The country also has some 45 percent of the world's reserves in cobalt. Whisler said there was interest from the U.S. government and the World Bank in seeing some progress in that part of the world. "Things are heading in the right direction. We are under no illusions, there will be challenges," he said.