(Alliance News) - Kore Potash PLC maintained on Wednesday it complied with its obligations in the Republic of Congo after receiving a scathing letter from a top government official in that country last week.
The company owns the Kola and DX potash projects in Republic of Congo.
The group said it received a letter dated October 12 from Mines Minister Pierre Oba, expressing his discontent with aspects of the administration of the company's subsidiary companies in the country and the apparent lack of progress in financing Kola project.
The letter indicated that the government reserved the right to take measures should the company fail to respond within 30 days.
Kore said it intended to formally respond to Oba's letter within the 30-day period afforded by the minister.
The letter, the company explained, was received following the arrest and subsequent release without charge of two senior employees of the company by the Congolese police. No reason was given for the arrests.
Also Kore said it continued to progress the development of the Kola and Dougou projects towards production, and believed that it was in compliance with its obligations to the government.
It vowed to keep the mines minister briefed on its plans and progress.
The company said it updated the minister on October 10 on its positive progress in the development of Kola and receipt of the engineering, procurement and construction proposal for the construction of Kola.
The company said it continued to work through the process for financing Kola as agreed with the minister in April 2021 and detailed in the memorandum of understanding with the Summit Consortium signed in the minister's office in Brazzaville.
The consortium is an investment group that represents investors and engineering firms.
While the Covid-19 lockdown restrictions in China delayed the timing of the finalisation of the engineering, procurement and construction proposal, the consortium continued to work through the agreed process steps towards presenting the company with the financing proposal for the full construction cost of Kola.
In London, shares in Kore Potash shed 12% to 0.86 pence on Wednesday afternoon, while it dropped 14% to ZAR0.18 in Johannesburg.
By Artwell Dlamini; artwelldlamini@alliancenews.com
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Kore Potash (KP2)