Congo (DRC) is a country with abundant copper and cobalt resources. It has the largest copper and cobalt resourcesregion in the world. According to statistics of USGS, by the end of 2016,Congo(DRC) had 20 million tons of copper, accounting for 2.8 percent of theworld's total reserves. The copper reserves of the Katanga copper mineral belt,centered on the cities such as Kolwezi, Likasi and Lubumbashi, are about 55million tons and cobalt reserves are 3.6 million tons. It has 2-9% oxidizedcopper-cobalt ores of large number of surface outcroppings and shallow-buriedgrade. According to the statistics of the Government of Congo(DRC), in 2016,Congo(DRC)’s copper exploitation quantity was 986,600 tons of copper,accounting for about 5 percent of global total output, ranking the seventh inthe world.

The Shituru copper mine is located in Katanga province in southeast of Congo(DRC), about 2 kilometers from the city of Likas and 125 kilometers from the west of Lubumbashi, the capital of Katanga province. It is also located in the world’s famous Katanga copper mine (sandstone and shale ore deposit).Its metal reserve is 3.89 million tons and average copper grade is 4.7%.

After conducting a thorough investigation of the copper industry at home and abroad, Pengxin Group is acutely aware that although the reserves of Congo (DRC) are not surprising, their exploration and development level is very low and there are thick and high-grade ore bodies, which are suitable for open-pit mining. The potential for additional reserves is huge. Though copper markets around the world were relatively depressed in 2011, Pengxin still made a decision to develop the Shituru copper mine in Congo(DRC). Through this move, Pengxin Mining responded to the country's strategic call to "go out" and industrial planning to become one of domestic pioneering enterprises engaged in overseas mineral resources investment and development, and has preliminarily completed the strategic layout of "transformation to non-ferrous metal and resources industry through keeping a foothold in China while focusing on overseas market”.

Shituru Mining Corporation(SMCO), a subsidiary of Pengxin Mining Holdings, is located in Katanga province, Congo(DRC), where transportation is convenient and hydro-power resources are abundant. Its main business is to engage in exploitation and development of copper and other minerals in Shituru mineral deposit land 4725, Congo(DRC). Its products are widely used for wires and cables, electronic, copper processing, mechanical making, copper alloy forging and other fields. SMCO started construction in September 2010 and put into production in March 2012. It took only 18 months from scale design, development, construction, trial production to completion of finished copper products, setting the fastest record of Chinese overseas mining investment project.

SMCO has successfully produced for many years and is one of the largest, most advanced and environmentally-friendly copper enterprises. With mature technology, its cathode copper output, recovery rate and other production indexes have reached the design requirement and the advanced level in the world. Its products are known as "the best cathode copper in Africa" among users. The 33,000 tons of cathode copper hydrometallurgy smelter has been designed and put into operation. In the process of copper hydrometallurgy, semi-self-grinding ball mill is used in grinding stage, with the advantages of large ore processing capacity, high grinding efficiency and low production cost. The high frequency vibrating screen is used in the process of classification with advantages of good classification efficiency, low cost and stable processing.The vacuum belt filter is adopted in the solid and liquid separation process and suitable for large - scale continuous automatic production with the advantages of high automation degree and low power consumption .The whole production process is smooth with good production index and is at the industrial leading level. In 2017, it produced 34,000 tons of electro deposited copper and independently completed the small extraction workshop project.

Congo(DRC) cobalt metal reserves are 3.4 million tons, accounting for 48.6% of the world's total reserves. According to the Congolese government, cobalt production reached 77,392 tons in 2016, accounting for more than 70 percent of the world's total output. But China's cobalt reserves are only 1.11% of the world's total.From 2002 to 2017, the global cobalt consumption increased from 37,000 tons to 115,000 tons. China, Japan, the United States and Europe are the largest countries of cobalt consumption in the world. In recent years, China's cobalt consumption has maintained a rapid growth and in 2007, it surpassed Japan to become the largest cobalt consumption country in the world. Due to the strong growth in demand for new energy vehicles, it is expected that global cobalt demand will continue to maintain a rapid growth and prices will continue to rise in the future.

In September 2017, the foundation-stone laying ceremony of SMCO cobalt project and the establishment ceremony of Congo(DRC) cobalt ore trading centre were held in Likasi, Haut-Katanga Province, Congo(DRC). The SMCO cobalt Project is only about 2 km from Likasi and about 3 km from the provincial road (Likasi to Lubumbashi, the capital of Katanga province and the economic center of Congo(DRC)). So it has convenient transportation, abundant water sources and hydroelectric supply facilities such as converting station near mining area and smelters. The superior location enables SMCO to obtain sufficient labour, convenient energy and water supplies, and mature transportation conditions, thereby reducing operating costs and operating risk. Final product of SMCO cobalt project is cobalt hydroxide, and by-product is cathode copper.

The project is divided into two phases. The first phase is one year. In this year, cobalt hydroxide can produce 3000 tons of cobalt metal, the second phase starts in the second year of production with the construction period of 1 year, the annual production of cobalt metal from cobalt hydroxide increased to 7000 tons. It is expected that in the fourth quarter of 2018, the project will provide scarce cobalt products for the market. The launch of SMCO cobalt project in the market and establishment of the cobalt ore trading center will accelerate the company’s pace of investment and development of overseas nonferrous metal mineral resources and increase the control of resources. It is an important initiative to build the whole industrial chain of "industry + trade +finance".

In order to ensure the sustainable development in Congo, Pengxin Mining has started the continuation of mineral resources. To date, it has signed a 25-year lease development agreement with the State Mining Corporation of Congo for the PE1078 copper cobalt mine. Moreover, the company signed the exclusive sale agreement with Vicent, local Congolese mining company. It is the company’s another strategic reserve.

Since SMCO was established nearly 10 years ago, it has been always attaching great importance to social responsibility that Pengxin Mining has always advocated. SMCO has established and maintained positive interaction with local communities and governmental institutes. It not only employed nearly 80% of employees in the local area but also committed to contributing to the local social welfare. Through renovating school buildings, donating schoolbags and stationery, disaster relief and fire fighting, repairing roads and building bridges, Pengxin Mining has not stopped its efforts in public welfare and has won a good reputation in Congo.