Important Disclosure. Material is for sophisticated or accredited investors only and does not constitute an offer to buy or sell securities. Data reflect public sources and FG Capital Advisors analysis, July 2025.
Greenfield vs Brownfield Exploration — Democratic Republic of Congo
The DRC offers two distinct exploration paths: opening untouched terrain (greenfield) or expanding known mines and historical pits (brownfield). Each carries a unique blend of risk, capital intensity and value‑creation speed. Understanding these levers is critical when allocating exploration capital across the Copperbelt.
1. Definitions and Scope
- Greenfield — virgin licences with no documented drilling. Value lies in first‑pass mapping, geophysics and target‑generation before any resource statement.
- Brownfield — permits surrounding or underlying an existing or dormant mine. Historical data inform step‑out drilling aimed at resource expansion or grade control.
- Both routes remain subject to the 10 % state free‑carry only when exploitation rights are granted.
2. Capital Intensity and Timeline
| Greenfield | Brownfield | |
|---|---|---|
| First‑phase spend | USD 1 – 1.5 m (mapping, soils, 3 000 m RC) | USD 0.5 – 0.8 m (data rehab, 1 500 m RC) |
| Drill‑to‑resource | 24 – 30 months | 12 – 18 months |
| Discovery cost (Cu‑eq) | ≈ 2.5 ¢/lb | ≈ 4 ¢/lb |
| Success probability* | 8 – 12 % | 28 – 35 % |
*Probability of generating a resource > 100 kt contained Cu‑eq.
3. Upside Capture and Valuation Multiples
- Greenfield discoveries can command 8 – 12× uplift from drilling spend once an indicated resource is published, driven by scarcity value and optionality for major producers.
- Brownfield additions typically realise 3 – 6× uplift but reach monetisation faster through advanced‑stage farm‑out or royalty streaming.
- M&A premiums in the Copperbelt average USD 120 – 140/t Cu‑eq for brownfield inventory versus > USD 200/t for Tier‑1 greenfield finds.
4. Infrastructure and ESG Considerations
- Greenfield licences in northern Lualaba often lack roads and grid power; capex allowances for early access tracks and camp logistics add 10 – 15 % to budgets.
- Brownfield sites leverage legacy power lines, pits and tailings dams but must address historical reclamation liabilities.
- Both pathways require baseline biodiversity and community studies; brownfield projects gain goodwill by integrating legacy workforce retraining programmes.
5. Comparative Risk Matrix
| Risk Factor | Greenfield | Brownfield |
|---|---|---|
| Geological uncertainty | High | Medium |
| Data confidence | Low (new) | High (legacy drilling & assays) |
| Permitting complexity | Medium | High (rehabilitation clauses) |
| Community relations | Medium (new stakeholders) | Variable (legacy expectations) |
| Time‑to‑monetisation | Long | Short |
6. Capital Allocation Strategy
- Allocate 60 – 70 % of risk capital to brownfield programmes that convert ounces or pounds quickly, underpinning portfolio NAV.
- Reserve 30 – 40 % for greenfield “shots on goal” that can generate outsized returns if a Tier‑1 system is uncovered.
- Blend equity with royalty or stream finance for brownfield; keep greenfield funding equity‑heavy to preserve upside.
7. Illustrative Case Studies
- Greenfield — Kamilombe Ridge: soil anomalies at 1 250 ppm Cu led to an inferred resource of 210 kt Cu in 27 months on a USD 9 m budget; transaction with a major at 10× cost.
- Brownfield — Musonoi Extension: 8 000 m of step‑out drilling added 42 kt Cu and 5 kt Co to an operating pit; project financed via 2 % NSR and sold to existing operator within 14 months.
8. FG Capital Advisors Exploration Mandate
- Funding envelope: USD 25 million, split 65 % brownfield, 35 % greenfield.
- Ticket size: USD 2 – 6 million for brownfield blocks; USD 4 – 10 million for greenfield corridors.
- Return targets: portfolio IRR above 28 % with downside protection via royalty seniority on brownfield assets.
- Pipeline: two near‑pit licences in Kolwezi and four greenfield permits in north‑eastern Lualaba under LOI.
Accredited investors interested in technical decks, cost models or deal flow schedules may request access through contact@fgcapitaladvisors.com.
