Katanga Mining’s (TSX: KAT; US-OTC: KATFF) 75%-owned subsidiary, Kamoto Copper, has resumed importing and exporting materials, including production to and from the Democratic Republic of the Congo, after the government lifted a freezing order it issued to the company on Nov. 9, 2018.
The Directorate General of Customs and Excise (DGDA) issued the ban after alleging that Kamoto did not declare or pay duties on more than 6,000 tonnes of copper it exported in December 2014 and January 2015. Kamoto claims it never produced the excess copper, but incorrectly invoiced it for $43 million in the company’s year-end 2014 financial statements. It says it removed the overstated production and revenue from its restated financial statements in 2015 and 2016.
The DGDA continues to claim that Kamoto produced and exported the copper and has proposed export duties and other financial penalties against the company. Kamoto says it will continue disputing the allegations.
In early November 2018, Kamoto also announced it would temporarily suspend cobalt sales and exports from its Kamoto copper-cobalt project after finding higher levels of uranium in its cobalt hydroxide than African ports allow. The company says more than 1,300 tonnes of finished cobalt have been affected. The levels of uranium do not pose health or safety risks.
The company intends to build an Ion Exchange system that will remove uranium from its cobalt. It aims to construct and commission the system for US$25 million by the third quarter of 2019. In the meantime, it will store the finished cobalt at the project.
Shares of Katanga Mining are currently trading at 52¢ with a 52-week range of 36¢ to $2.83. The company has a $980 million market capitalization.