Congo suspends ERG subcontractors at major cobalt mine

The Democratic Republic of Congo has suspended nine subcontracting companies working at mines run by Eurasian Resources Group, as the cobalt and copper producer faces fresh complications in the country.

The allegations mark the latest sign of frayed relations between ERG and the Central African nation. The country supplies more than three-quarters of the world’s cobalt and is the second-largest copper producer, giving it an important role in the energy transition. The government says it’s striving to generate greater domestic benefits from its critical resources which are mined by international companies.

The company said a “substantial majority” of its expenditure in the nation goes to Congolese suppliers, adding that it is working with the regulator to ensure that its operations comply with local laws.The latest measures affect firms with contracts at ERG’s two operating projects in Congo: Metalkol, which was the world’s fourth-biggest source of cobalt last year, and Frontier, which produced more than 100,000 tons of copper in 2023.

Legislation passed in 2017 reserves the subcontracting market for businesses majority-controlled by Congolese nationals. More than 50% of the shares in all the companies singled out by Kashal – including Etalon, Roche Solide and Surtek – are held by Congolese individuals, according to corporate filings.

Congo’s leaders made several attempts last year to regain potentially lucrative yet undeveloped permits from ERG, with Gecamines variously offering to buy some licenses, terminating the Swanmines joint venture and demanding the return of its permit for the Kalukundi copper-cobalt concession. ERG is fighting the cancellation in court.

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