FIERCE competition between the US and China for critical minerals resulted in “an unusual” US initiative in the Democratic Republic of Congo, according to the Financial Times.
The paper said the US tried to facilitate a deal for copper and cobalt mines for Swiss trading house Mercuria that hinged on Washington lifting sanctions against Dan Gertler, the controversial Israeli billionaire sanctioned by the US Treasury in 2017.
Gertler owns royalty streams from the mines which are owned by Kazakh-controlled Eurasian Resources Group (ERG). The FT previously reported that the US would grant Gertler licences to sell the royalty streams back to the Congo government for $300m. Once completed, Gertler’s access to the US financial system would also be restored.
Mercuria was identified by the US State Department as one of the companies interested in buying the mines from ERG, amid previous interest of Chinese companies.
Under one of the proposals discussed last year, Mercuria would have acquired all of ERG’s projects in the country, except its oldest project Boss Mining, said the FT. However, the parties could not agree on the value of the assets, particularly given the falling price of cobalt, the paper said citing four people familiar with the discussions.
The US would still like to facilitate a sale to a US-friendly buyer and a future deal with Mercuria is not off the table, said the FT.
Anglo American was also asked by US officials in 2022 to consider acquiring some of ERG’s mines, but the talks did not progress as far as those with Mercuria.
China has a strong presence in the Congo, but it has been forced to renegotiate a number of its investments in the country.
Felix Tshisekedi, Congo’s president, said earlier this year the rebalancing of the so-called Sicomines mining agreement with China would bring in $7bn to the Congolese treasury. In July last year, Chinese company, CMOC, agreed to pay the Congolese government $2bn to settle a dispute over declared mineral reserves at its Tenke Fungurume copper-cobalt mine.
