Chemaf, the Congo subsidiary of Dubai-based Shalina Resources, is halting operations at its Usoke copper-cobalt processing plant and stopping construction work on its Mutoshi plant, Chief Financial Officer Nico de Lange told Reuters on Sunday.
The facilities are the latest mining operations to be affected by travel restrictions and border closures caused by the coronavirus pandemic, which de Lange said had made it impossible to source sufficient oxide ore for Usoke to function.
Despite the plant’s closure, Chemaf’s Etoile copper and cobalt mine is still producing
“It’s an operational decision, not a COVID decision, but COVID was the last push,” said de Lange, adding that Usoke was loss-making prior to the coronavirus pandemic.
The Democratic Republic of Congo has shut schools, banned gatherings of over 20 people, closed restaurants and bars, restricted internal travel and suspended inbound flights from badly affected countries to stem the spread of the coronavirus.
Chemaf is in discussions with workers at both plants, de Lange said, declining to give details of the packages being negotiated. The Mutoshi plant employs 1,100 workers, while Usoke – which has put under so-called under care and maintenance – employs about 570.
The processing plant that Chemaf is building at Mutoshi will have capacity for 20,000 tonnes of copper and 16,000 tonnes of cobalt per year, according to its website.
Chemaf’s Etoile copper and cobalt mine is still producing as normal, de Lange said. The company’s target is for Etoile to produce 2,000 tonnes of copper and 460 tonnes of cobalt per month this year.
Production losses at Usoke this year will be offset by increased production at Etoile’s processing plant, so there will be “effectively no impact” on Chemaf’s overall output, according to the CFO.
The cobalt and copper miner has also shut the Mutoshi artisanal cobalt mining site – through which cobalt is sold to commodity trader Trafigura under a pilot project started in January 2018 and overseen by the NGO PACT.
Chemaf initially closed the site on March 23 for two weeks due to the risk of spread of the coronavirus but is likely to extend the closure, de Lange said.
De Lange would not comment when asked whether Chemaf was also in negotiations with the artisanal mineworkers at Mutoshi to provide them with an income in the interim.
The artisanal miners work under a mining cooperative, COMIAKOL, which has around 5,000 members. The number of miners on-site on any given day varies but can be up to 2,700, according to a technical report on the pilot project.
The Democratic Republic of Congo has 154 confirmed cases of the novel coronavirus and 18 deaths from COVID-19, the government on Saturday.
(By Helen Reid; Editing by Jason Neely, Mark Potter and Pravin Char)
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