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Overrun by militia, Canadian miner Banro suspends Congo gold operations

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Canadian gold miner Banro Corporation has suspended operations at several of its sites in Democratic Republic of Congo because the company can no longer ensure their security from armed rebels, its chief executive said on Friday.

Adds comment from Banro CEO, details

JOHANNESBURG, Sept 27 (Reuters) - Canadian gold miner Banro Corporation has suspended operations at several of its sites in Democratic Republic of Congo because the company can no longer ensure their security from armed rebels, its chief executive said on Friday.

Banro's mines have been repeatedly attacked by Mai Mai militiamen in eastern Congo. In the latest major incident, four Banro employees were kidnapped in July and held for several weeks before being released.

Banro CEO Brett Richards said the company declared force majeure on Tuesday at the Namoya gold mine and several more of the company's operations.

He said the rebels' repeated attacks on Banro facilities constituted the kind of unpredictable event that justifies a declaration of force majeure, a legal clause that, when invoked, can free an entity from meeting contractual obligations.

Due to its difficulties operating in eastern Congo, Banro is in financial distress and is in the process of selling its Twangiza gold mine to its minority shareholder, China's Baiyin International Investments, Richards told Reuters.

"The government has done nothing to create a sustainable and positive environment for Banro's employees to work safely and securely," he said, adding that all Namoya employees had been evacuated two weeks ago.

An official at Congo's mines ministry could not be immediately reached for comment. Banro informed the government of the suspensions in a Sept. 24 letter.

Richards said the declaration was partly meant to increase pressure on President Felix Tshisekedi to find a solution, and said he expected to meet Tshisekedi during the president's planned visit to the eastern city of Bukavu on Oct. 7 and 8.

Richards said the Twangiza mine, which has been less affected by militia attacks, would remain operational and that he hoped to finalise the sale to Baiyin next week.

(Reporting by Helen Reid and Aaron Ross, Editing by Susan Fenton and Angus MacSwan)

((Helen.Reid@thomsonreuters.com; +44 20 7542 0402;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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