* Tenke given two months to complete its review
* First Quantum unit sees its contract cancelled
(Adds Freeport, AngloGold comment)
By Thomas Hubert
KINSHASA, Aug 6 (Reuters) - Democratic Republic of Congo has cleared four major mining deals after completing its long-delayed mining contract review, but the massive Tenke project has yet to be fully approved, the government said.
The review launched in early 2007 in an effort to boost state revenues from agreements signed mostly during the chaos and corruption of a 1998-2003 war and the transitional government that followed, has examined 61 deals in the mining sector, one of Congo's biggest foreign currency earners.
Congo approved contracts with AngloGold Ashanti (ANGJ.J: Quote, Profile, Research, Stock Buzz), Banro (BAA.TO: Quote, Profile, Research, Stock Buzz), Mwana Africa (MWA.L: Quote, Profile, Research, Stock Buzz), and Gold Fields (GFIJ.J: Quote, Profile, Research, Stock Buzz), provided it completes a feasibility study at its Kisenge project, a statement on the government website said on Thursday.
"We're awaiting formal communication from the DRC government of the agreement reached...following that we will finalise a new agreement which will replace our existing mining contract," AngloGold spokeswoman Joanna Jones said.
Separately, Deputy Mines Minister Victor Kasongo said the government has given two months to Tenke Fungurume Mining, the giant copper and cobalt project backed by Freeport McMoran (FCX.N: Quote, Profile, Research, Stock Buzz) and Lundin Mining (LUN.TO: Quote, Profile, Research, Stock Buzz), to complete the review of its mining contract in the country.
Tenke has yet to agree to the rewriting of the contract in accordance with new legislation, extra royalties on additional production, and the integration of the state company into management structures, Kasongo said.
"We are continuing to work cooperatively with the DRC government to resolve the ongoing contract review," Freeport spokesman Bill Collier said.
Since the review started, prices of key Congolese export copper MCU3 rose to almost $9,000 per tonne, but have now fallen back to around $6,000 per tonne as demand for industrial goods has weakened as a consquence of the global slowdown.
"The review process, which was promoted by the booming metal prices that were prevailing at the time ... has gone on too long and is bound to have undermined investor confidence to a certain extent," said Gus Selassie, an analyst at IHS Global Insight.
POLITICAL RISK
Many international mining companies invested in Congo, which boasts some of the world's richest deposits of copper and cobalt, while metals prices were rising earlier this decade, but a perception that contracts are unsafe may discourage further spending, especially as prices are well below their 2008 highs.
"It reflects just how difficult it is to do any kind of business in the DRC," said Barclays Capital analyst Gayle Berry.
Investors may take comfort if the approval of the four contracts is definitive, and would welcome an end to the review of the flagship Tenke project, which could be one of the world's biggest copper mines, analysts said.
Congo cancelled a copper and cobalt mining contract with Kingamyambo Musonoi Tailings, a unit of First Quantum (FM.TO: Quote, Profile, Research, Stock Buzz)(FQM.L: Quote, Profile, Research, Stock Buzz) Kasongo said, on grounds that unit had failed to begin commercial exploitation within the agreed timeframe.
First Quantum was not immediately available for comment.
Mining is the mainstay of the Congolese economy, and though there has been much interest from Western and Chinese resources firms, infrastructure is still dilapidated and many workers ply their trade in the often lethally unsafe informal mining sector.
(Writing and additional reporting by Daniel Magnowski; additional reporting by Catherine Bosley in London, Muchena Zigomo and James Macharia in Johannesburg; editing by Mark John and Peter Blackburn)
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