• 3 hours Nigeria Approves Petroleum Industry Bill After 17 Long Years
  • 5 hours Venezuelan Output Drops To 28-Year Low In 2017
  • 7 hours OPEC Revises Up Non-OPEC Production Estimates For 2018
  • 10 hours Iraq Ready To Sign Deal With BP For Kirkuk Fields
  • 11 hours Kinder Morgan Delays Trans Mountain Launch Again
  • 12 hours Shell Inks Another Solar Deal
  • 1 day API Reports Seventh Large Crude Draw In Seven Weeks
  • 1 day Maduro’s Advisors Recommend Selling Petro At Steep 60% Discount
  • 1 day EIA: Shale Oil Output To Rise By 1.8 Million Bpd Through Q1 2019
  • 1 day IEA: Don’t Expect Much Oil From Arctic National Wildlife Refuge Before 2030
  • 1 day Minister Says Norway Must Prepare For Arctic Oil Race With Russia
  • 1 day Eight Years Late—UK Hinkley Point C To Be In Service By 2025
  • 1 day Sunk Iranian Oil Tanker Leave Behind Two Slicks
  • 1 day Saudi Arabia Shuns UBS, BofA As Aramco IPO Coordinators
  • 2 days WCS-WTI Spread Narrows As Exports-By-Rail Pick Up
  • 2 days Norway Grants Record 75 New Offshore Exploration Leases
  • 2 days China’s Growing Appetite For Renewables
  • 2 days Chevron To Resume Drilling In Kurdistan
  • 2 days India Boosts Oil, Gas Resource Estimate Ahead Of Bidding Round
  • 2 days India’s Reliance Boosts Export Refinery Capacity By 30%
  • 2 days Nigeria Among Worst Performers In Electricity Supply
  • 3 days ELN Attacks Another Colombian Pipeline As Ceasefire Ceases
  • 3 days Shell Buys 43.8% Stake In Silicon Ranch Solar
  • 3 days Saudis To Award Nuclear Power Contracts In December
  • 3 days Shell Approves Its First North Sea Oil Project In Six Years
  • 3 days China Unlikely To Maintain Record Oil Product Exports
  • 3 days Australia Solar Power Additions Hit Record In 2017
  • 3 days Morocco Prepares $4.6B Gas Project Tender
  • 4 days Iranian Oil Tanker Sinks After Second Explosion
  • 6 days Russia To Discuss Possible Exit From OPEC Deal
  • 6 days Iranian Oil Tanker Drifts Into Japanese Waters As Fires Rage On
  • 6 days Kenya Cuts Share Of Oil Revenues To Local Communities
  • 6 days IEA: $65-70 Oil Could Cause Surge In U.S. Shale Production
  • 6 days Russia’s Lukoil May Sell 20% In Oil Trader Litasco
  • 6 days Falling Chinese Oil Imports Weigh On Prices
  • 6 days Shell Considers Buying Dutch Green Energy Supplier
  • 7 days Wind And Solar Prices Continue To Fall
  • 7 days Residents Flee After Nigeria Gas Company Pipeline Explodes
  • 7 days Venezuela To Pre-Mine Petro For Release In 6-Weeks
  • 7 days Trump Says U.S. “Could Conceivably” Rejoin Paris Climate Accord
MINING.com

MINING.com

MINING.com is a web-based global mining publication focusing on news and commentary about mining and mineral exploration. The site is a one-stop-shop for mining industry…

More Info

Congo’s Cobalt Tax Hike Threatens EV Market

EV

The Democratic Republic of Congo may soon more than double the tax mining companies operating in the country pay on exports of cobalt, a key component in the lithium-ion batteries that power electric cars and mobile phones.

The African nation, responsible for about two thirds of global cobalt output, has been evaluating the measure since last month, when a major revision to the 2002 Mining Code was passed by the parliament’s lower house.

If also approved by the Senate, the new law will qualify cobalt as a “strategic commodity” and so the royalty on exports of that metal will increase to 5 percent from 2 percent. Taxes on base metals, in turn, would increase to 3.5 percent, Bloomberg reports:

Mines Minister Martin Kabwelulu singled out cobalt’s “not only strategic but also critical character” on the world market. Tantalum, a scarce mineral extracted from so-called coltan ore and used in smartphones, could also be taxed at the higher rate, Kabwelulu said.

A royalty increase, paired with increasing political risk in Congo and the importance of conflict-free metals would give investors one more reason to look for cobalt elsewhere, experts say.

The most likely outcome of such tax increase would be a further compression in the amount of capital deployed into new mine construction and exploration in the DRC, Trent Mell, President and CEO of Canada's First Cobalt (TSX-V, ASX:FCC) told MINING.com.

"We came very close to making a significant investment in the DRC in 2017, but reversed course as we concluded the geopolitical backdrop was getting worse. This surprising news is just one more reason for investors like us to look elsewhere," Mell said. Related: The Biggest Loser Of The OPEC Deal

His company is now directing all efforts on primary or by-product cobalt opportunities and refiners, battery manufacturers and energy material companies are already expressing interest in what First Cobalt is doing. "By looking for cobalt as our primary focus, with additional payable metals, such as copper, nickel and in our case silver, we have taken a new approach to exploration to offer investors better exposure to the metal," Mell said.

Cobalt prices went ballistic last year, with the metal quoted on the London Metal Exchange ending 2017 at $75,500, a 129 percent annual surge sparked by intensifying supply fears and an expected demand spike from battery markets.

Top mining companies including Glencore (LON:GLEN), Randgold Resources (LON:RRS), China Molybdenum (HKG:3993) and Ivanhoe Mines currently operate in the DRC.

Through the chamber of mines, an industry lobby group, companies have opposed to the proposed reforms to the country’s 16-year-old code, saying that while it would boost government revenues, it would also make investments in the sector unprofitable.

(Click to enlarge)

Cobalt prices went ballistic last year, with the metal quoted on the London Metal Exchange ending 2017 at $75,500, a 129 percent annual surge.

By Mining.com

More Top Reads From Oilprice.com:




Back to homepage


Leave a comment
  • Steve Colby on January 11 2018 said:
    Good. Congo needs, and deserves the income.

    EVs will adapt, newer battery chemistries use far less cobalt, or none at all, life will go on.

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News