Presentation by PAC on ASM gold. Day 2 of the 6th ICGLR-OECD-UN GoE Forum on responsible mineral supply chains, 13 November 2013. Visit: http://mneguidelines.oecd.org/icglr-oecd-un-forum-kigali-2013.htm

1. PAC Gold Project
(supported by PPA)

2. Challenge
 Illegal Exportation of DRC Gold
 12-17 million tonnes/year (Group of
Experts
 Legal Exports < 1 tonne
 Most gold exported illegally via
neighbouring countries
 Tax loss
 2% royalty= $800,000 tonne
 $8 million (@10 tonnes)
 Conflict Financing
ICGLR

3. Project Goals
 Legal Exports
 Legally export a significant quantiy (>=1kg) of artisanally produced
DRC gold
 Create Traceable Mineral Chain for Gold
 Traceable gold mine site to export
 Formalise/Legalize Artisanal Producers
 Eliminate Conflict in Project Areas
 Use power of NGO/OECD to focus attention on project areas
 Pilot Project – Try out new techniques
 Experiment to see what works
 How to apply Annex 1 in real world situation
 How to scale up
ICGLR

4. Project Assumptions
 Gold is Different
 Easily Fungible (gold=money; money=gold)
 Easily Smuggled (unlike cassiterite)
 Easily bought/sold (unlike diamonds)
 Positive Inducements only
 Dodd Frank/ OECD have little to no effect
 Cannot force gold into legal channels
 Have to coax gold into legal channels
 Work with Existing Chain/Actors
 Minor tweaks only to existing mineral chain
 Find inducements for diggers, negociants exporters to participate
 Work collaboratively with government, industy in place
ICGLR

5. The Grand Bet
 Technical Assistance in exchange for Legal Sales
 Have to coax gold into legal channels
 PAC agrees to provide technical assistance and equipment to diggers
to help them increase their production (yield) of gold
 In return, miners agree to sell gold through identified, legal channels
 Higher Yields make up for Lower Price
 Diggers will receive less per gram for legally sold gold
 Higher yields possible with PAC equipment will make up for lower
price
 This is the Grand Bet
ICGLR

6. Project Phases
 Research Phase - COMPLETE
 Develop criteria for areas (axes) and sites
 Baseline research into areas and sites
 Enumeration (registration) Phase - COMPLETE
 Detailed Data collection on diggers in identified areas
 Specific site selction for productino phase
 Production Phase
 Study of sites, production methods
 Recommendation/implementatino of technical assistance
 Traceability Phase
 Development, implementation of clean traceable gold chain
 Legal exports to international market
ICGLR

7. Research Phase
 Complete
 April 2013
 Criteria for Areas (Axes) and Sites
 Reasonable production/digger population
 No overlying mineral claims


Limited conflict


Bunia/Watsa eliminated due to Sokimo claims (20% royalty)
Mambasa to Beni corridor elimated (Mai Mai Morgan taking Mambasa)
Proximity to Population Centre (project base)
 Preliminary Research
 4 Axes identified (Bondo, Mangi, Nia-Nia-Wamba, Bole-Bole)
 Baseline Research/mapping
 25 sites; 3000 miners
ICGLR

8. Research Phase
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9. Research Phase
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10. Research Phase
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11. Research Phase
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12. Enumeration Phase
 Complete
 June-Sept 2013
 Detailed Profile of Gold Exploitation
 Joint registration teams (gov/industry/civil society)
 Extensive visits to axes idenitified in research phase
 Goal had been registration (carte creuseur) but Prov Gov not ready
 Registration  enumeration
 Results
 >11,000 miners/negociants/auxiliaries enrolled in database
 Detailed information on age, sex, income, years in trade
ICGLR

13. Enumeration Phase
Age distribution
50%
44%
45%
40%
35%
30%
24%
25%
18%
20%
13%
15%
10%
5%
1%
0%
< 18
18 - 25
25 - 35
Age Range
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35 - 45
> 45

14. Enumeration Phase
university
2%
primary
education
36%
secondary
education
62%
ICGLR

15. Enumeration Phase
% Type of Work global
Auxiliaries
30%
Diggers
68%
Traders
2%
% GENDER TOTAL
WOMEN
22%
MEN
78%
ICGLR

16. Production Phase
 Ongoing
 Began Oct, 2013 with technical visit
 Runs Oct-Dec 2013
 Technical Visit
 Oct 7-22, 2013
 PAC teamed up with Artisanal Gold Council, Dr. Kevin Telmer
 Field work in 2 sites – Mangi, PK25-PK51
 Study geology, production methods
 Devise, test, implement improvements in production methods
 Study/sugget longer term interventions
 Geology, environment, scaling, sustainability
ICGLR

17. Existing Technology-Mangi
ICGLR

18. Sluice - Mangi

19. Panning Concentrate - Mangi

20. Grain Size Analysis

21. Grain Size Analysis
Sieve
Aperture
(mm)
Gold
(g)
% of
Total
8
12
20
2.36
1.7
0.85
0.83
0.15
0.49
16.4
3.0
9.7
50
100
<100
Lost
0.30
0.15
<0.15
1.57
0.89
0.85
0.27
31.4
17.5
16.8
5.2
Fine Grain Gold (100, <100) is 34.3% of total!!!

22. Improved Sluice

23. Scavenger Sluice

24. Collector Basin

25. Concentrator – Vortex (Blue Bowl)

26. Production Phase - Results
 Results - Mangi
 Grain size distribution indicates fine gold worth pursuing
 Introduction of new sluice material, scavenger sluices,
terminal basin
 Introduction of sieving for limited grain size panning
 Introduction of vortex for final concentrate processing
Increase
ICGLR
in yield of approx 30%

27. Production Phase - Rollout
 Rollout
Mangi
Sluice carpets (thick and fine) for 50 teams being
delivered
 Sieves for 50 teams being delivered
 PAC personnel on hand for training in new techniques
 Excavation/safety material already delivered
 Picks, shovels, gloves, boots,etc

ICGLR

28. Production Phase – PK25-51
 Results – PK25-51
 More mechanized sites, extensive mercury use
 Study indicates Introductino of:
 Mechanized crushing
 Better milling (non-octagonal mills)
 Gravity separation (centrifuge)
 Better sluicing (scavenger sluices)
 Centralized tailings collection/treatment

Rollout PK25-51



ICGLR
Full set of interventions beyond project budget
Single step intervention under consideration (crushing)
Predominance of Beni/Butembo negociants is complication

29. Traceability Phase
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30. Traceability Phase
Mass Balance Approach
Miners
Registration of Production
at Mine Site
1.5 kg
month
Registration of Sales
at Negociant
1.0 kg
month
Negociants
Exporter
ICGLR
Registration of Sales
at Exporter
750 g
month

31. Traceability Phase
Closed Pipe vs Mass Balance
M
Negociant
Illegal
Exporter
Shop
Keepers
Negociants
Negociant
Exporter
Shop
Keepers
Exporter

32. Mass Balance Approach
M
Negociant
Illegal
Exporter
Shop
Keepers
Negociants
Negociant
Exporter
Shop
Keepers
Exporter

33. Closed Pipe Approach
M
Negociant
Illegal
Exporter
Shop
Keepers
Negociants
Negociant
Exporter
Shop
Keepers
Exporter

34. Scaling Up
M
Negociants
88% of World Price
Pre-financing
Exporter
10% margin
(2.5% taxes)
98% of World Price???
ICGLR

35. Scaling Up
L
o
c
a
l
D
e
v
e
l
2
%
T
e
c
h
n
A
s
s
t
2
%
T
r
a
c
e
a
b
il
it
y
2
%
M
Pr
e
Fi
n
c
n
c
e
1.
5
%
Negociants
88% of World Price
NGOREFINER
ALLIANCE
10% margin
(2.5% taxes)
98% of World Price

36. PAC Gold Project
(supported by PPA)
Tracking,
Certifying,
Exporting
Artisanal Gold from
Eastern DRC