A Congo Gold Mine

Perhaps the most remarkable effort he found under way was Banro's effort to use geologists from established African countries such as Ghana and Tanzania and to educate promising young Congolese geologists. While many foreign-based miners in Africa use a lot of mechanical digging equipment and shoo away local laborers and "artisanal," or freelance, miners, Zaunscherb found that Banro was employing more than 1,000 locals at substantial wages as part of its effort to improve the country and build trust. He found that a company foundation was also active in the community, building bridges and hospitals.

Skeptics should also keep in mind that gold projects in the Congo are not like ventures in Mongolia and elsewhere, which are almost purely speculative. Substantial mining before the civil war that made the Congo too dangerous to explore has shown conclusively that the Central African copper belt holds at least 5 billion tons of copper and as much as 40% of the world's cobalt reserves.

Gold is always found in similar mineralization zones. In this case, it is in equatorial areas where large cratons -- blocks of the earth's crust -- have contracted and formed rich mountainous belts. Banro is focused on an area wedged among the Congo Craton to the west, the Tanzania Craton to the east and the Zimbabwe Craton to the south. Gold, tin, tungsten, tantalum and other ores fill gaps in the cracks of smashed-up sedimentary and granite layers.

Place Your Bets

Analysts point out that Banro's 25-year permits to explore 1,014 square miles of the Twangiza-Nomoya gold belt -- and applications to explore in another 2,636-square-mile area -- are of a size more commonly associated with much larger companies. And indeed, just as young biotech companies may sell off stakes in promising molecules to large pharmaceutical makers, Banro might peel off pieces of its projects to senior gold producers to keep operations funded without diluting shareholders.

Independent Canadian researchers at the Fraser Institute have concluded that the gap between the current level of mineral production in the DRC and what it is capable of producing is the largest of any region in the world. No area with comparable potential wealth has yet to be exploited with modern mining techniques.

But before it can all be monetized, the elections have to run without a major hitch. Nearly half of Congo's 60 million people have reportedly registered to vote for one of 33 presidential candidates and 500 of 9,000 people running for seats in a new legislature. The U.N. has trained 300,000 election workers. Optimism, for the moment, has replaced rampant cynicism in both the public and commercial spheres over whether the vote -- which will conclude with a September run-off -- will work for citizens and investors alike.

Chester Crocker, a former assistant U.S. secretary of state for African affairs, told Bloomberg last week that he was happy to see companies "jockeying for position, trying to be part of a success story" in this "treasure-trove country."

It may be nuts, but if you want to have some fun with the sliver of your portfolio devoted to well-informed speculation, it's time to place your bets. To capitalize on the potential for commodities in a rebounding DRC, consider the basket of international mining stocks listed in the chart above.

At the time of publication, Markman had no positions in stocks mentioned in this column, although positions may change at any time.