Gecamines Pursues Chemaf’s Cobalt Projects Amidst Sales Controversy

Gecamines has submitted a bid for Chemaf’s cobalt and copper assets as the DRC government opposes Chemaf’s sale to Norin Mining. Chemaf seeks to stabilize its finances after struggling with debts and project delays. Despite government resistance, Chemaf is committed to the proposed sale to Norin to address creditor obligations and local employment.

Gecamines, the state-owned mining company of the Democratic Republic of the Congo (DRC), has recently submitted a bid to acquire the cobalt and copper assets of Chemaf Resources (CRL), as reported by Bloomberg News. This development follows the DRC government’s opposition to Chemaf Resources’ proposed sale of its mining assets to Norin Mining, a subsidiary of China North Industries (Norinco). The government contends that this sale contravenes the lease agreements that Gecamines holds with Chemaf. In June 2024, Chemaf, in partnership with commodities trader Trafigura, had previously expressed intentions to proceed with the sale of its mining assets to Norinco. Despite facing resistance from the Congolese government and Gecamines, Chemaf has continued to pursue this transaction. Reports indicate that while Chemaf has been actively seeking a buyer for the past nine months, Gecamines is now seeking to acquire the company’s assets. Further details regarding Gecamines’ bid remain undisclosed. The Congolese government retains a 5% ownership stake in Chemaf. The latter has initiated the process of asset disposal due to significant financial challenges that have impeded the advancement of its Etoile and Mutoshi projects amid a downturn in cobalt prices. Chemaf believes that the acquisition by Norin Mining is critical in facilitating the completion of delayed projects and meeting its financial obligations to creditors. A spokesperson emphasized the company’s commitment to finalizing the transaction with Norin Mining, stating it would assist in addressing overdue loans and ensuring job security for the local workforce.

The Democratic Republic of the Congo is one of the world’s largest producers of cobalt, a critical element used in batteries and various technology products. Chemaf Resources, involved in cobalt and copper mining, has faced financial hardships that have prompted it to put its assets on the market. The proposed acquisition by Norin Mining represents a crucial move for Chemaf as it attempts to stabilize its operations and meet the demands of lenders. Gecamines, with its state-backed authority, has become a significant player in this situation by asserting its rights and interests regarding lease agreements related to Chemaf’s assets, thus adding a layer of complexity to the transactions.

In summary, Gecamines has positioned itself to possibly acquire Chemaf Resources amid ongoing disputes regarding the company’s financial struggles and asset sales. The DRC government’s challenges to the proposed sale to Norin Mining underlie the competitive tension in the cobalt market, reflecting broader implications for the industry as global demand for cobalt continues to rise. Chemaf remains determined to finalize its transaction with Norin, which it sees as essential for resolving its financial difficulties and continuing its operations in the DRC.

Original Source: www.mining-technology.com