The China Molybdenum Co Ltd (CMOC) has been ordered to halt vital exports of cobalt from its vast operations in central Africa in an ongoing squabble over royalties.
An administrator appointed by a court in the Democratic Republic of Congo (DRC) to run the world’s second-largest cobalt mine told CMOC to suspend marketing as well as production. The letters, dated June 29 and July 1, mark the latest escalation in a dispute between the Chinese mining company, which owns 80% of TFM, and the DRC’s state-owned mining company Gecamines, which holds the remaining 20%.
The government of DRC accused CMOC of understating reserve levels to reduce the amount of royalties it pays to Gecamines. In the June 29 letter, addressed to CMOC’s board, the provisional administrator wrote that the terms for the marketing of TFM’s production in 2022 had not been met.
Halt implementation
The letter ordered CMOC to share all the information regarding its marketing and exports since January 1 within 24 hours and told CMOC to stop marketing and exporting products from TFM in the interim.
In the July 1 letter, the provisional administrator ordered Congo’s customs authority to implement suspension of TFM’s exports. TFM produced 18,501 tonnes of cobalt and 209,120 tonnes of copper in 2021.
China’s ambassador to the DRC said Beijing is closely following the dispute between Gecamines and CMOC and “making sure the rights of Chinese companies are respected”.
“We must encourage the two companies to maintain a dialogue … without using the apparatus of the state or resorting to brutal methods,” Zhu Jing said.
