Societé Minière de Bakwanga

Societé minière de Bakwanga (abbreviated MIBA) is a diamond mining company based in the Democratic Republic of the Congo. Historically, the company was the largest diamond producer in the world by volume. However, following decades of decline, the company currently produces only a small minority of the DRC's diamonds.^[1][2]

MIBA operate near Mbuji Mayi, in Kasai-Oriental Province in south central DRC. Approximately 80% of MIBA's stock is owned by the Congolese government, with 20% owned by Asa Resources Group.

During Belgian rule, diamonds were first discovered near the Bushimaie river in December 1918 by George Young, a Scottish geologist employed by the Compagnie du chemin de fer du bas-Congo au Katanga.^[3] The Société minière du Bécéka (Mibeka) was then founded in 1919, with the specific purpose of exploiting the mineral riches in the area of Mbuji-Mayi.^[4] A controlling stake in the company was held by Société Générale de Belgique. From the start of mining, Forminière was responsible for management of the Bakwanga mine, though Bécéka maintained ownership.

In 1946, geologists located the kimberlite pipes that were the original source of the Bakwanga diamonds. Nine of the ten pipes in the Mbuji Mayi cluster were located within the "Polygon" mining license owned by Bécéka (later MIBA).^[5] In 1956, MIBA also discovered the Tshibwe cluster of kimberlite pipes, and mined these for a while.^[5]

In the 1950s, it was estimated that the city, then known as Bakwanga, and its surrounding area had the world's most important deposit of diamonds, with at least 300 million karats.^[6] While about 95% of the diamonds found near Bakwanga were relatively low value bort, the grade was very high and relatively cheap to mine.^[3]

On August 27, 1960, during the Congo Crisis, the Bakwanga mine was closed due to the Invasion of South Kasai. When it reopened on January 1, 1961, Bécéka took over management of the Bakwanga mine.^[7]

In 1962, Mibeka created the Societé Minière de Bakwanga (MIBA) as a subsidiary. This was during the Congo Crisis when the DRC established its independence from Belgium. Mibeka transferred all of its exploitation rights and Congolese assets to MIBA while relocating all of its Belgian assets to Belgium.^[9]

Independence from Belgium did not necessarily slow the extraction of diamonds, but it did seriously affect MIBA's dominance of the region's diamond trade. In 1959, the year before Congolese independence, MIBA reportedly produced 14.1 million karats of diamonds, and in 1961 set a record production rate with 18 million karats of diamonds. But by 1963, the numbers had fallen dramatically in the wake of years of turmoil, including an attempt to establish the region as the independent Mining State of South Kasai. In that year, the company produced just 1.4 million karats of diamonds, almost all of them industrial diamonds. By contrast, between 4 million and 6 million karats of diamonds were produced by diamond smugglers who had previously been tightly controlled by the Belgian colonial administrators, to the benefit of the company's Belgian management.^[6]

The company's profits were also commandeered by the South Kasai government of rebel leader Albert Kalonji. In 1961, those profits were estimated to be $12 million.^[6]

Despite the smuggling and regional turmoil, the company was extremely dominant in the world's diamond trade. In 1963, MIBA produced 80 percent of the world's industrial diamonds and 57 percent of all diamonds.^[6] However, from 1961 to 1967 nearly all of the production was exported illegally through neighboring countries, such as the Republic of Congo.^[3]

In the 1960s, Mobutu looked into ways to sell Zaïre's industrial diamonds. He entered agreements with the Belgian-American businessman, Maurice Tempelsman, and together they held significant interests in MIBA.^[10] Tempelsman helped Mobutu set up a relationship with De Beers consortium, allowing the Oppenheimers to import the DRC's diamonds to London.^[11] Starting in 1967, exclusive purchasing rights for Zaïre's diamonds was given to British Diamond Distributing Ltd. (Britmond). Britmond was a subsidiary of the De Beers Central Selling Organization (CSO).^[12] However, in April 1981, Mobutu announced that the Zaïre's state-owned Société Zaïroise de Commercialisation des Minérais (Sozacom) would be taking over international marketing of the country's diamond production, ending the arrangement with Britmond.^[13][12] However, marketing arrangements through De Beers were reëstablished in early 1983.^[14] Sozacom was dissolved in 1984, due to its tendency to divert receipts from the Zaïre treasury.^[15]

In 1986, Mobutu appointed Jonas Mukamba Kadiata Nzemba as chief executive officer of MIBA. He remained in the position for more than ten years, up through the First Congo War.^[16]

In 1994, the economy of Mbuji-Mayi was increasingly disconnected from the central government of Mobutu Sese Seko. Residents rejected the 1993 New Zaïre and supported opposition leader Étienne Tshisekedi. Conditions at the mine deteriorated, with production falling by more than half over five years. An employee estimated only 30% of gem quality stones reached the end of the production line, due to theft.^[17] Due to the lack of involvement from the central government, by the 1990s MIBA maintained much of the infrastructure in the city of Mbuji Mayi, including water, electricity, roads, schools and hospitals.^[18]

During the First Congo War in March 1997, the ascendant Alliance of Democratic Forces for the Liberation of Congo ended the arrangement under which De Beers had a monopoly on marketing all the production from MIBA, allowing other buyers to purchase some of MIBA's production at monthly auctions.^[19][20]

In February 2000, the Tshibwe cluster, an 800 square kilometer diamond mining area just south of Mbuji-Mayi in the which contained MIBA's best kimberlite deposits was transferred from MIBA to the joint venture Sengamines [fr].^[19] After a failed bid to float the Oryx company on the Alternative Investment Market by selling to Petra Diamonds in June 2000,^[21] Sengamines claimed it had sold off equity in the company, 49% to the Cayman Islands-based Oryx Natural Resources, controlled by Omani businessman Thamer Bin Said Ahmed Al-Shanfari, 35% for COMEX Congo, and 16% for MIBA. However, no buyout actually occurred, and the ultimate beneficiary of Oryx's stake was the Zimbabwe Defence Forces, through its subsidiary Operation Sovereign Legitimacy (OSLEG).^[22] Rather than a commercial sale, the transfer was a means for Laurent Kabila to help finance Zimbabwe's military interventions in the DRC.^[23][24][25] MIBA took back control of the Sengamines area in August 2005.^[26]

In 2000, MIBA hired a British-South African security consultant, Nigel Morgan, to work in security for the company. Morgan claimed to find irregularities in the company, including that at least five MIBA officials were engaging in stealing high value stones, and appealed to president Kabila to intervene. Morgan then left the country after receiving death threats.^[27]

In July 2000, the DRC government announced a ban on diamond exports, granting International Diamond Industries-Congo (IDI), a firm owned by Dan Gertler, an exclusive 18 month monopoly on exports from the country.^[28] However, following the assassination of Laurent Kabila, the deal was revoked in April 2001.^[29]

MIBA chief executive officer Jean-Charles Okoto was among those named in an October 2002 report from the United Nations Security Council report describing pillaging of the DRC's resources.^[30] Also in October 2002, Amnesty International reported that dozens of people were being shot every year on the MIBA concession.^[31] In response to the UN report, DRC president Joseph Kabila suspended Okoto.^[32]

In April 2003, Emaxon Finance International provided MIBA $15 million in financing in exchange for the right to purchase 88% of MIBA's diamond production.^[33][34] While the offtake agreement was initially signed in secret, the arrangement ended up being publicized three months later during a dispute between the Congolese minister of mines and his deputy; the previously unclear owner of Emaxon was revealed to be Dan Gertler's DGI Group.^[27]

This deal was criticized by a 2005 Congolese parliamentary commission headed by Christophe Lutundula who recommended the contract be renegotiated.^[35] The offtake agreement with Emaxon expired at the end of 2007.^[36]

In 2006, Umicore subsidiary Sibeka, sold its interest in MIBA to Mwana Africa (now known as the Asa Resources Group).^[37][38]

In 2007, diamond exports fell by 80%. There was significant insecurity at the mine, with an engineer responsible for running a new $10 million dragline excavator, and a security guard both murdered. About 10,000 artisanal miners trespassed onto the mining site every day, and employees had not been paid for more than four months.^[39]

In October 2008, the MIBA employees went on strike several times for not being paid for more than 20 months.^[40] Production was suspended between November 2008 and March 2011.^[41]

Since 2013, MIBA has handed over management of the Tshibwe cluster to Societé Anhui-Congo d’Investissement Minier Sprl (SACIM), a joint venture between MIBA and the Chinese Anhui Foreign Economic Construction Group.^[5]

In 2020, the government of the DRC voted to remove MIBA's governing board and restructure the company, after a May 2020 audit found significant irregularities.^[42] In August 2020, at the behest of the Félix Tshisekedi administration, the state miner Gécamines gave MIBA $5 million to revamp operations.^[43]

According to the Congolese Ministry of Mines, MIBA is one of only two industrial diamond mining companies in the DRC in 2023. However, the vast majority of diamond production in the country is attributed to artisanal miners or the other industrial miner, Anhui Congo Mining Investment Company (SACIM).^[44]

MIBA has a subsidiary, Energie du Kasaï (Enerka) which operates the Tshiala hydroelectric power station to power mining activities, and also provides power to the nearby city of Mbuji-Mayi. The plant was previously installed with twelve turbines and 18 megawatt total capacity.^[59] These consisted of the 1.4 MW Tshiala 1, 7 MW Lubilanji 1, and 10.08 MW Lubilanji 2.^[60] The Lubilanji 2 expansion of the plant was finalized after a $5 million contract with Anglo Belgian Corporation in July 2000.^[19]

In 2012, MIBA ended a contract with the company Hydroforce Congo which had managed the hydropower plant for over four years.^[61]

In 2021, president Félix Tshisekedi recommended the plant be transferred to the national electricity company SNEL, and a Tshiala II project bring the plant up to combined 8 MW.^[62][63]

As of 2022, only two of the turbines were still working, at a capacity of 3.2 megawatts.^[59]

MIBA formerly operated a cargo airline known as MIBA Aviation.