Democratic Republic of Congo (DRC) ERG Arbitration, Presidential Family Allegations, Manono Lithium Complex, and the President’s Kazakhstan Visit


Executive Summary

The DRC sits at the centre of the global energy transition, yet governance failures and overlapping legal disputes threaten to blunt its advantages. On September 9–10, 2025, President Félix Tshisekedi undertook a state visit to Astana, Kazakhstan. Officially, the agenda emphasized bilateral cooperation; unofficially, the visit focused on defusing the multi-year confrontation with Eurasian Resources Group (ERG) over revoked copper–cobalt rights in Katanga/Lualaba. In parallel, the Manono hard-rock lithium saga widens: COMINIÈRE’s €39.125M ICC penalty remains unresolved; a $2.06M “double-book” gap from a 2021 stake sale to Zijin tarnishes the SOE’s credibility; a $70M humanitarian package linked to Manono shows a $30M shortfall with conflicts of interest; the State’s selective recognition of partner rights has pushed AVZ/Dathcom to arbitration over exploitation permit PR13359. Meanwhile, KoBold Metals has received seven exploration permits in Tanganyika and Haut-Lomami, signalling deeper U.S. strategic engagement—yet PR13359 itself is explicitly excluded and remains under dispute. The net effect: tactical de-escalation (ERG), strategic contestation (Manono), and structural governance risk (COMINIÈRE and conflicts of interest).

Presidential Visit to Kazakhstan: Objectives, Outcomes, and Implications

1.1 Official framing vs. working reality

• Officially: A two-day state visit (Sept 9–10) at President Tokayev’s invitation; agenda highlighted trade, investment, mining collaboration, and broader bilateral ties.
• Unofficially (core aim): Advance a settlement with ERG to end arbitrations triggered by permit cancellations and project disputes across the DRC copper–cobalt belt.

1.2 What changed during the visit

• Settlement signalling: Congolese and Kazakh sides indicated a cooperation/settlement understanding “on the margins” to restart stalled ERG–Gécamines projects. While the full-term sheet remains undisclosed, the political messaging points to:
• A glidepath to reinstatement or secure tenure for specified ERG titles, linked to project-execution milestones.
• Compliance undertakings on subcontracting, local content, environmental performance.
• Value balancing via compensation, offsets, or asset sharing with Gécamines;
• A phased re-ramp of suspended operations (e.g., Boss Mining) under tighter oversight.
• Why it matters: The accord reduces headline legal risk, eases pressure from ICC/ICSID tracks and showcases Kinshasa’s willingness to negotiate complex disputes timely as the DRC courts Western strategic partners.

1.3 Implications

• For DRC: Avoids the tail risk of $-billion arbitral liabilities; improves optics with Western partners; affirms “resource sovereignty” narrative if concessions to Gécamines are visible.
• For ERG: Stabilizes portfolio and reputation, likely at the cost of stronger ESG and local-participation terms; sets a precedent other operators will track.
• For investors: Positive signal that intractable disputes can be converted into structured resets—yet policy unpredictability and SOE governance still elevate the DRC risk premium.

ERG Dispute: How We Got Here (Condensed Chronology)

• 2022–2024: Gécamines and regulators escalate enforcement—challenging ERG JVs/permits for alleged non-progress, subcontracting and environmental non-compliance; Swanmines/Kalukundi cancelled; Boss Mining suspended; February 2024 buy-back overtures tabled.
• ERG legal response: ICC (contract/JV) and ICSID (investor–State) filings; demands include reinstatement, declarations against administrative irregularities, damages (likely $bn-scale) and provisional measures to freeze reallocations.
• 2025 (pre-Astana): ERG rotates counsel; both sides intensify back-channel talks—culminating in the Astana understanding to restart projects and wind down arbitrations.

COMINIÈRE: Penalty, Leakage, and Social-Fund Controversy

3.1 €39.125M ICC penalty (March 10, 2025)

• Finding: COMINIÈRE breached tribunal emergency orders in the Dathcom matter (moving on titles/rights despite injunctions).
• Risk: Immediate financial liability plus interest; enforcement actions if unpaid; credibility damage in any forum assessing State/SOE reliability.

3.2 $2.06M “double-book” gap (Dathcom 15% sale to Zijin, 2021)

• Declared vs. paid: $33.44M publicly declared vs. $35.5M admitted as actually received; instruction to maintain dual figures signals intentional opacity.
• Value loss: IGF valuation implies the 15% stake was nearer $150M—suggesting >$100M value leakage beyond the $2.06M cash discrepancy.

3.3 $70M humanitarian package tied to Manono (2023): $30M missing, conflicts of interest

• Design: Zijin/Manono Lithium pledged $70M for victims of violence in eastern DRC; funds intended for public good.
• Routing: Up to $40M reportedly received by Le Bouclier, an NGO led by Jean-David E’Ngazi (UDPS member and COMINIÈRE board director, close to the COMINIÈRE chair).
• Gap: $30M unaccounted for—reportedly parked in a temporary anonymous account with no public audit trail.
• Conflict: A State-mandated director simultaneously controlling private aid linked to an SOE partner is a clear conflict of interest.
• Impact: Reputational damage across State/SOE/partner/NGO; undermines humanitarian credibility and invites regulatory/sanctions scrutiny.

African Security Analysis (ASA) assessment: COMINIÈRE’s posture—tribunal defiance, dual accounting, and conflicted social spending—constitutes systemic SOE governance failure. Any sector reset must start here.

Manono Legal Architecture and the PR13359 Dispute

4.1 The State’s selective recognition

• Action (2023): The State terminated the Dathcom JV (AVZ ~75%, COMINIÈRE 25%, later 15% sold to Zijin) and reassigned PR13359 entirely to COMINIÈRE.
• Paradox: The State recognizes Zijin’s 15% transaction (cash contributions rolled into a Manono Lithium SAS JV with COMINIÈRE) while erasing AVZ’s 75% economic/contractual position.
• Legal risk: Violates equal treatment of shareholders and pacta sunt servanda principles; invites investor–State liability and commercial damages.

4.2 Litigation status (as of Sept 11, 2025)

• ICSID: Interim measures (Jan 2024) require the DRC to recognize Dathcom/AVZ’s rights and refrain from prejudicial acts during proceedings.
• ICC track: Partial/merit rulings have reinforced AVZ’s partner-stake claims and censured title reassignments that breach orders.
• Bottom line: PR13359 (Roche Dure) remains under arbitration and outside any new permit grants; any State action to the contrary compound’s exposure.

KoBold Metals: Seven New Exploration Permits (U.S. Strategic Vector)

5.1 What was granted (KoBold Exploration DRC SA — 100%)

Territories: Manono (Tanganyika) and Malemba Nkulu (Haut-Lomami).
Permits & indicative sizes (apps around July 23, 2025):

• PR16318 — Manono — ~169 squares
• PR16320 — Manono
• PR16322 — Manono — ~464 squares
• PR16324 — Manono — ~147 squares
• PR16319 — Malemba Nkulu — ~193 squares
• PR16321 — Malemba Nkulu & Manono — ~452 squares
• PR16323 — Malemba Nkulu & Manono — ~265 squares

Minerals authorized (across PRs): lithium; niobium–tantalum (coltan); rare earths; tin; gold; silver; beryllium; manganese; titanium; wolframite, etc.

5.2 What these permits do—and do not—confer

• Exploration only: All seven are Permis de Recherche; they do not grant exploitation rights.
• Crucially: PR13359 is not included. The contested exploitation title remains under ICSID/ICC canopy and cannot be substituted by PRs.
• Strategic placement: The PRs effectively bracket Manono, positioning KoBold to pivot quickly if a lawful acquisition/settlement of AVZ’s ~75% proceeds.

5.3 Transaction thesis and geopolitical tie-in

• Deal vector: KoBold has explored a non-binding path to acquire AVZ’s project interest—consistent with U.S. aims to secure non-Chinese lithium supply.
• U.S.–DRC agenda: The permits align with a broader critical-minerals partnership trajectory (complementary to Lobito-Corridor logistics), strengthening Washington’s hand in the EV supply chain.
• PR13359 boundary: Any overlap claims or de-facto encroachment would violate ICSID measures and chill investor sentiment—careful cadastral hygiene is imperative.

Allegations Involving the Presidential Family (Contextual Risk)

• Since 2023: Reports and testimonies link artisanal/irregular mining on ERG concessions to members of the presidential family/inner circle (denied by the Presidency).
• July 8, 2025 (Brussels): NGOs and ex-Gécamines directors filed a complaint against nine relatives (dual Belgian nationals) for alleged looting/corruption in Lualaba/Haut-Katanga.
• Risk effect: Even as allegations, internationalization (Brussels venue) escalates scrutiny; complicates reformist messaging; intensifies domestic political exposure.

Geopolitical Layer: U.S.–China Competition, Kazakhstan Linkages

• China anchors: Zijin’s stake and the northern Manono claim via Manono Lithium SAS; historic dominance in DRC cobalt/copper.
• U.S. entry: KoBold’s PRs and the prospective AVZ buy-in represent the first scalable U.S. mining re-entry in years, with Washington seeing Manono as strategic leverage.
• Kazakhstan bridge: ERG’s détente (via Astana) reduces cross-border friction and underscores Kinshasa’s multi-vector diplomacy—balancing China, Kazakhstan, and the U.S. to maximize outcomes.
• Investor read-through: The winner at Manono signals the prevailing supply-chain sphere: a KoBold–AVZ consummation would be a U.S. supply-chain milestone; a sustained Zijin primacy consolidates China’s battery-metal hold.

Scenarios (12–24 months)

A) Global Settlement (stability-positive)

• ERG accord implemented, phased project restarts.
• Manono: tri-party deal—KoBold acquires AVZ; State regularizes titles; Zijin’s northern block ring-fenced/compensated; ICSID closed by consent.
• Result: Country risk narrows; diversified financing returns; governance tested by real transparency.

B) Partial Reset, Persistent Friction (base case)

• ERG holds; Manono remains split (AVZ arbitration lingers; KoBold explores; Zijin advances); sporadic injunction fights.
• Result: Delays, higher costs, reputational drag; episodic policy shocks.

C) Adverse Legal Shock (downside)

• ERG settlement falters: ICSID/ICC produce unfavourable rulings; enforcement actions target State/SOE assets.
• Result: Investor retrenchment; governance downgrades; political blowback.

Risk Matrix

• Political risk: Very High — elite-capture allegations; regional resentment in Katanga/Lualaba; coalition management pressure.
• Legal/arbitration risk: Severe — ERG multi-track liability; ICC penalty outstanding; ICSID measures governing PR13359.
• Institutional risk: Critical — SOE procedural defiance; opaque cashflows; conflicted social spending.
• Security risk: Moderate–Rising — resource-grievance mobilization potential; anti-Kinshasa narratives in the south.
• ESG/reputational risk: High — €39M penalty; $2.06M leakage; $30M humanitarian gap.
• Investor confidence: Fragile — settlement signals help, but durable transparency and enforcement are decisive.

Implications for a Prospective U.S.–DRC Critical-Minerals Agreement

Enablers: ERG settlement; KoBold PRs; State’s stated openness to Western offtake/security linkages.
non-negotiables (to sustain credibility):

1. Honor ICSID/ICC measures until superseded by lawful settlement.

2. Settle ICC penalty (transparent plan) and publish a forensic audit of COMINIÈRE (5-year lookback).

3. Ring-fence social funds in an independent escrow with quarterly public audits (covering the $70M stream, tracing the missing $30M).

4. Cadastre integrity: single source of truth; GIS-mapped titles; no overlaps; automatic public disclosure of changes.

5. Manono roadmap: appoint a neutral facilitator; target a consent-based resolution (AVZ–KoBold–Zijin–COMINIÈRE) within a defined calendar.

Independent Expert Recommendations

As independent analysts of African Security Analysis (ASA), we distil our findings into actionable recommendations designed to mitigate risk, ensure compliance, and safeguard stakeholder interests in the Democratic Republic of Congo (DRC).

For the Government of the DRC

• Transparency in Settlements: Publish non-confidential terms of the ERG–Gécamines agreement, including license status, ESG obligations, and milestone conditions, to build trust with investors and citizens alike.
• Accountability in SOEs: Implement a forensic audit of COMINIÈRE covering at least five years, enforce the €39.125M ICC penalty settlement through a public payment plan, and restructure boards to ensure independent oversight.
• Social Fund Integrity: Establish a statutory escrow mechanism for all mining-linked humanitarian or community development funds, with mandatory third-party audits and quarterly disclosures.
• Cadastre Modernization: Digitize and centralize the mining cadastre, enforce GIS mapping to prevent overlapping permits, and introduce an automatic public “red flag” system for disputed titles.
• Structured Manono Resolution: Mandate a neutral facilitator to negotiate a settlement between AVZ, KoBold, COMINIÈRE, and Zijin, aligned with ICSID orders. The settlement must protect investor rights while ensuring state benefit.

For Foreign Investors and Mining Operators

• Contract Design: Embed arbitration-resistant clauses in contracts, including stabilization guarantees, step-in rights, and accelerated dispute calendars.
• Compliance Telemetry: Develop real-time monitoring systems for environmental, subcontracting, and royalty obligations—making results public to pre-empt political and reputational risk.
• Due Diligence: Harden KYC/AML processes around SOEs, politically exposed persons (PEPs), and NGOs to mitigate corruption exposure and future liability.
• Community Engagement: Integrate transparent, verifiable community investment programs to build local legitimacy and reduce grievances in resource-rich provinces.

For International Partners (U.S., EU, IFIs, Bilateral Donors)

• Conditional Support: Tie financial assistance and strategic partnerships to measurable governance benchmarks, including resolution of outstanding penalties and public disclosure of social-fund allocations.
• Capacity-Building: Strengthen CAMI (Cadastre Minier), IGF (Inspection Générale des Finances), and commercial courts to handle disputes transparently and competently.
• Settlement Facilitation: Support creation of a neutral international forum to resolve the Manono dispute, preventing prolonged litigation from delaying strategic resource development.
• Strategic Engagement: Prioritize balanced engagement to avoid overdependence on any single foreign partner (China, Kazakhstan, U.S.), thus securing DRC’s sovereignty in resource management.

ASA’s Value Proposition

The Astana visit delivered necessary de-escalation with ERG and signals that Kinshasa can convert disputes into structured settlements. But without immediate, public corrective action on COMINIÈRE’s legal liabilities and fund governance, and a lawful, consent-based Manono resolution (that respects arbitral constraints while enabling KoBold’s entry), the DRC’s risk profile will remain acute. The strategic prize—credible leadership in global EV minerals—demands enforceable transparency now.

The DRC offers some of the world’s richest reserves of critical minerals essential to the green energy transition. Yet, this opportunity is shadowed by legal uncertainty, SOE mismanagement, and political risk. ASA provides independent, field-informed, and source-verified intelligence to governments, corporations, and investors operating in such volatile environments.

Our expertise lies in:

• Mapping governance and compliance risks before they turn into crises.
• Providing actionable intelligence grounded in both local field networks and international legal analysis.
• Designing tailored risk-mitigation frameworks to safeguard assets, contracts, and reputations.
• Offering strategic foresight to anticipate political, legal, and security shifts that impact investment decisions.

For stakeholders considering entry or expansion in the DRC, African Security Analysis (ASA) ensures that your capital, contracts, and reputation are shielded by clarity, foresight, and verified intelligence. We stand ready to accompany our partners in navigating the DRC’s complex mining and governance landscape—transforming risk into resilience and opportunity.

ERG: Eurasian Resources Group – Kazakhstan-based multinational mining and metals company with operations in the DRC.

ESG: Environmental, Social, and Governance – Standards for evaluating corporate sustainability and ethical impact.

ICSID: International Centre for Settlement of Investment Disputes – World Bank body for investor–State arbitration.

ICC: International Chamber of Commerce – Institution that administers international commercial arbitration.

COMINIÈRE: La Congolaise d’Exploitation Minière – State-owned mining enterprise in the DRC, involved in Manono lithium projects.

Gécamines: La Générale des Carrières et des Mines – Major DRC state-owned mining company, partner in multiple ventures.

PR13359: Permis d’Exploitation No. 13359 – The disputed Manono lithium exploitation permit (Roche Dure deposit).

KoBold Metals: US-backed exploration company focused on critical minerals, recently granted DRC permits.

AVZ: AVZ Minerals Ltd – Australian mining company holding majority stake in Dathcom JV for Manono project.

Dathcom: Joint venture company (AVZ ~75%, COMINIÈRE 25%, later partly sold to Zijin) for the Manono lithium project.

Zijin: Zijin Mining Group – Chinese mining company with significant stakes in DRC mining projects, including Manono.

SOE: State-Owned Enterprise – Company owned by the government (e.g., COMINIÈRE, Gécamines).

ASA: African Security Analysis – Independent intelligence and risk advisory firm, author of the report.