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China's CMOC threatens legal action over Congo cobalt mine export block

5th December 2022

By: Reuters

  

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China's CMOC Group could take legal action against Congo's State mining company Gecamines, a spokesperson for the Chinese mining firm said, after having exports blocked from Tenke Fungurume, the world's second-biggest cobalt mine, for a fifth month.

Tenke Fungurume Mining (TFM) suspended copper and cobalt exports in July, when a dispute between Congo and CMOC escalated, and a temporary administrator appointed by a Congolese court to run the mine ordered CMOC to stop marketing and exporting its production.

Congo's government says it suspects CMOC understated TFM's reserve levels to reduce the amount of royalties it pays to Gecamines. CMOC, which was previously known as China Molybdenum, denies having done so.

"Errors of export code at customs caused export interruptions," CMOC spokesman Vincent Zhou said in written responses to Reuters' questions, acknowledging for the first time that exports had been disrupted.

"We have already filed with (the) government authority to request (the) correction of such errors and will resort to legal actions to protect (the) rights of the company," Zhou added.

On Oct 12, CMOC had said TFM's production and operations were normal. But the mine has not exported since July, according to logistics and industry sources.

"Exports are still suspended," said Sage Ngoie Mbayo, the state-appointed temporary administrator of TFM. "We need to get the two shareholders around a table."

CMOC holds 80% of TFM while Gecamines owns the remaining 20% stake.

Zhou said CMOC has maintained communications with Gecamines and believes the TFM royalty payment issue will be dealt with "in an impartial and just manner".

"If they [CMOC] want to take this to court internationally, we are ready," said Leon Mwine Kabiena, deputy director general of Gecamines.

"A legal process for us is an opportunity to expose the reality," he said, adding that "we as Gecamines are very confident of the evidence we have". 

Edited by Reuters

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