Trafigura reject Gupta’s claims. Credit: stux / Pixabay.

Through its Democratic Republic of Congo (DRC) subsidiary, Chemaf, Shalina Resources has closed a $600m financing and marketing deal with commodity trader Trafigura.

The funds will be used by Chemaf, a producer of copper and cobalt, to complete the fully mechanised Mutoshi cobalt and copper mine.

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The capital will also be used to build a solvent extraction-electrowinning (SX-EW) processing plant in Kolwezi and advance the Etoile SX-EW plant expansion in Lubumbashi.

Under the agreement, Trafigura will be responsible for marketing all cobalt hydroxide produced at Chemaf’s DRC operations up until the end of 2027.

In a press statement, Trafigura said: “An important component of the transaction involves Trafigura working with Shalina and Chemaf, using their combined experience to enhance the management of social and environmental impacts in line with international standards, including the OECD’s ‘Due Diligence Guidance for Responsible Supply Chains’ and Trafigura’s own responsible sourcing programme.”

Trafigura noted that the deal will create a new supply of copper cathode and high-grade cobalt hydroxide amid surging global demand for both.

With commissioning planned for the third quarter of 2023, the Mutoshi mine is expected to be one of the largest cobalt and copper mines in the DRC.

Located near Kolwezi in the DRC Lualaba province, Mutoshi was originally an artisanal cobalt formalisation project.

It was operated for roughly two years by Trafigura, alongside miner Chemaf and NGO PACT, until March 2020, when operations were closed due to the Covid-19 pandemic.

However, even at a later stage, operations at the mine could not restart due to the country’s law mandating the sale of all artisanally produced cobalt through state-run cobalt company Entreprise Generale du Cobalt (EGC).

Subsequently, the project was ended on 31 December 2020, and Chemaf planned to turn the site into an industrial mine.