Congo signs over potential $880m of royalties in Glencore project to offshore company belonging to friend of Congolese President (14.11.2016)


RDC: Fleurette Group Statement “re: KCC Royalties” (15.11.2016)


KINSHASA, Democratic Republic of Congo, November 15, 2016Fleurette Group notes the statement made by Global Witness today concerning the sale of royalties from Katanga’s KCC project by Gecamines to a Fleurette-owned entity. The Global Witness statement is highly misleading, based on factually inaccurate information designed to manipulate data in an effort to undermine a legitimate transaction.

Fleurette Group categorically refutes the allegations by Global Witness that the DRC economy has somehow lost money through the sale of the KCC royalty stream. The transaction between Africa Horizons Investment Limited (“AHIL” – which is a 100% Fleurette subsidiary) and Gécamines. With hindsight, Gécamines negotiated a highly lucrative transaction to the benefit of the DRC.

Additionally, Global Witness’s financial calculations are amateurish to the point of bogus. They do not follow even the basic valuation techniques used by all professionals in this field, and fail to include further discounts (such as withholding tax payments) that are both obvious and important. Global Witness has no excuse for making these mistakes. The manipulation of data seems wilful in nature, and designed to support a pre-ordained conclusion. It is difficult not to infer that Global Witness is trying to mislead journalists, the general public and other stakeholders at Fleurette’s expense.

DRC made net profit from deal, Fleurette a net loss

The transaction ultimately resulted in Gecamines safeguarding value for the DRC economy and Fleurette making a considerable loss due to the subsequent collapse in commodity prices and suspension of KCC’s operations. This is because Gecamines sold the royalty right before operations at KCC were suspended, meaning Fleurette had paid in full for a royalty stream that that ceased soon afterwards. While Fleurette was left unable to recoup its investment, Gecamines received full value for it.

This should not come as a surprise. Fleurette recognizes this as inherent industry risk in the mining sector. KCC, meanwhile, was well advised. It carried out its own verification, taking reasonable measures in accordance with its procedures to satisfy itself the sale was authorized by Gecamines and that there was an underlying basis for the sale. Independent international financial institutions advised both sides, and the transaction was priced in accordance with the valuations provided to the parties. Global Witness does not acknowledge these facts. Instead, despite these facts, it attempts to crititicize a deal which demonstrably and unequivocally benefited both Gecamines and the DRC.

Global Witness mistakes

Global Witness’ statement implies that KCC royalties were worth $880m to Fleurette. By referencing the Independent Technical Report of March 2012 prepared by Golder Associates, Global Witness was duty bound to provide an accounting and valuation in a bona fide manner, which they did not. Global Witness’ implication that the royalties were worth $880m shows a lack of understanding of the most basic business and accounting principles of Discounted Cash Flow and Net Present Value, used to value royalty streams (as well as a host of other assets that are expected to provide value into the future).

Even though Golder Associates provide a very conservative 10% discount factor to their valuation of the KCC project (including royalty cashflow streams they expected to be generated), Global Witness applied 0% discount when expressing the worth of the royalty stream in their statement. If they had applied an industry-standard 15% discount factor, the cashflow they misleadingly referred to would have determined a $245m valuation for the royalty right until 2030.

There is another valuation factor that Global Witness has omitted entirely, even though it hugely impacts the assessment of value for the KCC Royalty. Crucially, AHIL’s royalty right will almost certainly fall away in on 1 March 2019. As per the terms of the original KCC JV Agreement between Katanga, Gecamines and KCC (all publicly available), Gecamines has a “Replacement Reserves” obligation which requires it to deliver 4m tonnes of copper reserves and 200,000 tonnes of cobalt to KCC. If it doesn’t, under the terms of the agreement, Gecamines needs to pay $285 million to compensate KCC. If it is not able to do that, the JV Agreement requires the repayment to be made by way of set-off of the royalty, ie KCC will withhold the royalty until that debt has been paid. In short, the royalty that Fleurette paid for will not be paid to Fleurette from 1st March (assuming KCC is back in operation and paying royalties), but will be used to cover off a pre-existing Gecamines debt.

Global Witness also intentionally omitted the annual rental deduction of $1.2m from their calculation and 10% withholding tax on royalties.

Questions for Global Witness

Unfortunately for AHIL and KCC, the project ceased production in September 2015. AHIL does therefore not expect to receive any more royalties, and will have suffered a huge loss as a result – as royalties paid up to this point were far less than the amount AHIL paid for the royalties. This is an example of how industry risk can play a major part in the life of a DRC project in addition to the broader risks associated with operating in a country like the DRC.

Global Witness needs to be held to account on this occasion given the unnecessary damage this misleading report will do to the DRC’s extremely delicate economy and the reputation of Gecamines as well as Fleurette, which is leading the recovery effort following the collapse of global commodity prices. In essence, this was a good deal by Gecamines, independently verified by multiple stakeholders, which safeguarded value for the DRC, but a poor deal for Fleurette. It is deeply regrettable Global Witness is publishing such inaccurate information.



Media enquiries


+44(0)20 7250 1446

About Fleurette – / LinkedIn  / Twitter

The Fleurette Group of Companies (“Fleurette”) is an entrepreneurial business with significant investment in diverse sectors, including natural resources, infrastructure, agriculture and technology. Fleurette has substantial investments and operations in the Democratic Republic of Congo (DRC). The parent company of the group, Fleurette Properties Limited, a Dutch resident company, is owned by Line Trust Corporation Limited strictly and solely as trustees of the Ashdale Settlement, a trust established in 2006 for the benefit of the family of Dan Gertler. Mr Gertler is a citizen and resident of Israel and the DRC (and honorary counsel to the DRC) and is committed to developing the country’s natural resources and infrastructure, while investing in the Congolese people and their communities.

Fleurette has a proven track record of successful co-operation with diverse parties, including the DRC State-owned mining company Gécamines, and to date has brought more than USD $7 billion of investment into the DRC, on top of its USD $2 billion in private investment. As a result, Fleurette’s subsidiaries and partnerships support around 30,000 jobs in the DRC and are amongst the DRC’s leading taxpayers, contributing significant revenues to the State.

Fleurette is also a major contributor to social development in the DRC through the Gertler Family Foundation (GFF) and through direct investment in social infrastructure. The GFF is the largest charitable organization in the DRC, funding more than 50 programs and projects across the DRC, which help tens of thousands of Congolese every year. These include rebuilding key hospitals, notably the Kisangini “Hospital du Cinquantenaire”; supporting the Operation Smile campaign in Lubumbashi and Kinshasa; rebuilding Blaise Pascal School in Lubumbashi; and supporting the Lubumbashi Zoo.

Lord Mayor Erias Lukwago Takes Oath (Youtube-Clip)

“Lord Mayor Erias Lukwago takes oath to start his five year term as mayor of Kampala” (NBS TV Uganda, 2016)

Erias Lukwago statement after hectic day with the Police (19.04.2016)

Lukwago 19.04.2016

Statement from Erias Lukwago:

The notorious police van has just dumped me and Hon. Munyagwa Mubarak at my residence in Lubaga, and sped off with Dr. Besigye and Ingrid Turinawe still on board. We were bundled into the said van at Ntungamo police station where we had been detained after towing our vehicle at Butoberere and pulling us through the hilly areas of Rwamucuucu amidst a heavy downpour. Our vehicles were vandalised and teargas canisters hurled therein. Many thanks to the people of Ntungamo and Kabale for your unwavering support notwithstanding the excessive teargas and live bullets unleashed by the trigger happy police” (Lukwago, 19.04.2016).

Lukwago Bows to Pressure, Not Entering Office (Youtube-Clip)

“Kampala Lord Mayor Erias Lukwago has finally bowed down to pressure and accepted not to get into office until court finally resolves his issues. Lukwago was advised by the deputy chief justice to wait for the hearing of the Attorney General’s appeal against high court orders that reinstated him into office” (NBS TV Uganda, 2016).

Lord Mayor April 2016

Dr. Stella Nyanzi sacking and eviction letters; This is a obvious Political Motivated Sacking from Makerere

Stella Makerere Letter 2. 2016Stella Makerere Letter 1. 2016

My two cents: 

This can only happen, because she has showed loyalty to Dr. Kizza Besigye and been open on Social Media for his Presidential Candidature. She as a Doctor would have had the Posistion; if she was a Yellow NRM Party Member and also Stayed silent if she was a Opposition Member. So this here is a Political Move to prove that the Makerere University and the MISR. This can’t be because of lack of work or ethical modus operandi at the University. So this is just a pointless sacking with Political Substance.

The Racketeering has now wings into all organizations, all businesses, all poltical activity get chain-reactions and the ones that tries to defy Don Museveni. Apparently deserves a sacking. This also ends with an eviction from her home with her family. So the Dr. Stella Nyanzi lost her job and home because of her affiliation to FDC instead of NRM. Congratulation to Makerere University for proving that they are on the knees and bending their hands to get more into their pockets from the racket of the NRM. Peace.

Lord Mayor of Kampala’s Erias Lukwago – Bond Paper! of 19. March of 2014 (A must read!).


Charged Preventive arrest! Preventive from themself or other people, we don’t know! Do you? That isn’t new for either Lord Mayor Lukwago of Kampala or Dr. Kizza Besigye of the FDC. But the most sad thing is the spelling on ‘No Surity’ – (State): Whatever that means! Can somebody please tell or those the brothers who arrested the Mayor some language lesson? They supposed to know something right=  The sad part of it is that I am sure by when I am adressing this, the NRM and KCC is sure fixing up a new warrent for Lukwago! Peace.

Feil fokus

Vel, i de siste to ukene eller kanskje mindre enn dette så faktisk fokuset vært på Nord-Uganda. Område fra Lira til Gulu(sånn ca). Hvor fra 1986 – 2005. UPDF (Uganda Peoples Defence Force) – Ugandas hær og Lord Restience Army (LRA) kriget en brutal krig med alle mulige midler. Hvor begge styrker brøt med reglene for krig av Geneve, som startet det vi kjenner som Røde Kors i dag.

Nok om det. Det som er poenget! Er at en aksjon av den Amerikanske NGO Invisible Children. Har fokusert på en militær leder som ikke lenger er problemet i Nord Uganda. Ei heller en av grunnene til at USA sendte 100 militære rådgivere. De var nok mer til hjelp for styrkene til UPDF som er en ny leder av AMISOM i Mogadishu (Somalia). Ikke tro alt du hører eller leser. Det er mer bak fasaden enn dette også. For ikke lenge siden fant noen Irer og briter olje i Lake Albert. Ikke langt ifra Masindi – Murchinson Falls National Park – Paara. Så det er nok viktigere å holde områdene sikre for Total (Fransk Oljeselskap) og Tullow Oil(UK). Som begge to har skapt skandaler og ekstra høringer i Parliamentet i Kampala. Noe som har gitt munnkurv til flere kjente personer i NRM. FDC og DP vil ha hatt det anerledes og startet forhandlingene på nytt fordi for mange faktorer var gjort i skjul. Dette ble det ikke noe av. Bare hovedpersoner i NRM fikk det som de ville og Independent MPS stemte for. Slik at vi kan sikkert si: at noen er blitt betalt under bordet. Ikke bare for tredje gang ett nytt privat fly til Museveni.

Av alt det nevnte oppenfor. Så er det kommet til siden for #Kony2012. Som er på utsiden av Garamba Rainforest DRC(Democratic Republic of Congo) eller for de som er usikker. Den Kongo som ikke er Brazzeville. Kony stikker ofte oppom riker CAR(Central African Republic) hvor regjeringen er kjent for å bare kontrollere hovedstaden Bagui. Resten av landet ledes av forskjellige militser. Det var opp her han stakk fra Operation Thunder som varte en lang periode i 2008-2009. Et samarbeids prosjekt mellom UPDF, tropper fra Sør-Sudan og DRC. Disse skulle ødelegge mest mulig av treningsleire og gjemmeplasser til LRA. Noe som de har delvis klart og i denne aksjon mistet UPDF flere helikoptere.

Som du skjønner så har denne konflikten flere faktorer. Annet enn å bare spre en video av en random dude fra USA. Den har svære konsekvenser. Ikke at Kony eller LRA. Er spiselig for noen. Kanskje ikke seg selv. Det som er mitt hovedankter punkt mot denne kampanjen. Den kom på feil tid. Hvis det var snakk om at de gjorde dette PR stuntet for ca 5-6 år siden. Hadde den i allefall hatt en viss sannhet i seg. Nå har den veldig liten eller brøkdel av det den sier. Litt slik som Kristen Halvorsen og Lysebakken med sin flaue redgjørelse for å gi penger til venner uten å lyse ut midlene. Bare her gjelder det mennesker og den evige Europeere redder jo alltid liv i Afrika.

Invisible Childeren ønsker sikkert ikke dette slik. NRM og Ugandas Regjerning ønsket dette heller ikke slik. Derfor kom pressetalsmann Fred Opolot med en god kunngjøring om det hele. Hvor det hele ble avfeiet og kritisk kommentert. Noe som bare skulle mangle. Det er sjeldent jeg har noe positivt å si om NRM regime. Men de har gjort Nord Uganda fredlig etter lang tids kamper om territoriumet. Kvittet seg med LRA. Derfor kan de nå i vår hatt samtaler med Salva Kiir og få ordnet grenseområdene. Ikke minst også få rustet opp Kampala – Tororo – Lira – Gulu – Juba. Slik at handel kan skje mellom Uganda og Sør-Sudan.

Jeg er forsatt ikke sikker på hva de ville oppnå med sitt PR stunt. Ei heller om jeg støtter hele konseptet. Det er for vassent og dvaskt. Billig og simpelt pakket inn. De forteller lite og forventer hele verden til å hoppe etter. Når de en liten uker kommer en undskyldningsvideo. Som er like usikker som pressemøtet til Lysebakken i SV. Så vil man ikke si! Hei! Dere støtter jeg blindt. På tide å klappe hendene i sammen folkens! Stå på, forsett det gode arbeidet. Sorry Mac. Kan heller sette på CSI på TVN å glemme verden enn å høre på løgnene deres.

Ikke at jeg vil sitte på siden å bare se på. Når du først skal få meg til å tro på din sak. Som jeg kjenner godt fordi jeg var utveksling til området. Ettertiden lest meg opp om situasjonen og hvorfor den var slik den var når jeg var der. Så må du gi meg mer. Være sannferdig og troverdig. Ikke bare få Rihanna og Madonna til å tweete om det. Kom an! Vis meg litt styrke. At Støre og Solheim sier at de har endelig kuttet direkte økonomisk støtte til regjeringen i Uganda for store korrupsjonssaker og misbruk av midler. Klage på det nye privat flyet til President Museveni. Jada, de kuttet litt, men ikke slik at det svir. Storbritinia og Nederland trakk også midler men det var på grunn av den kjente Anti-Gay bill. Som forsatt er en snakkis. Selv etter å blitt lagt død og på vent for et lite år siden.

Vel. Om forandringene kommer til å komme. Om nye streiker kommer til å skje. UTODA og KCC er jo nå mot hverandre. Pioneer Buses kjører jo nå og Taxiene i Kampala(UTODA) står i stampe. Vil dette forbedre situasjonen, jeg tviler. Men det er jo alltid håp. Kutting av AID til Uganda fra Norge vil ikke si så mye. Spesielt nå som framtids fortjeneste på Oljen i Lake Albert er i omløp blant MPS og Presidenten på Kiira Road. Så kan man ikke forvente annet. Kanskje han pusser opp Statsmannsboligen på Nakasero Hill, Kampala og bygget i Entebbe. Eller et helt nytt. Lurer på om den store moskeen i Kampala. Gadaffi Moske kommer til å beholde sitt navn framover. Slik som Constitution Sqaure er jo blitt det (the)Square.

Ja. Anbefaling. Ikke støtt #Kony2012 og deres orginasonsjon Invisible Childeren. Det finnes bedre folk å støtte. Ikke minst finnes det bedre metoder å jakte gerilja ledere. Dette skjer ikke med å tweete. Eller opplysning om dem. Bare the blazing Gun tar dem ned og gjerne med støtte fra internasjonle organisasjoner. Selv med disse var det vanskelig å kvitte seg med Elfenbenskystens forrige president, Gaddafi og Laurent Nkunda(Rwanda-DRC). Så det er ikke godt å vite. Blir mer om det siden. Føl fri hvis du lurer på noe eller blitt mer forvirret! Peace.