Eurasian Resources Group’s Boss Mining copper/cobalt project was halted by the DRC government over environmental concerns after flooding sent mine waste into a river.

Boss Mining was placed on care and maintenance in February 2019 while its owners reviewed the economics and sustainability of the operation. The closure was expected and should be remembered in the context of the suspension of ERG's Chambishi smelter in Zambia (which was supplied with Boss Mining feed - mainly sulphide ore towards the end) as well as the introduction of a 5% duty on cobalt and copper concentrates imported into Zambia that same year. Both events made the operation of Boss uneconomic. Indeed, the operation had probably only operated in 2017 and 2018 thanks to high cobalt prices. 

A restart was announced in late 2022. ERG and its joint-venture partner, La Générale des Carrières et des Mines (Gécamines), celebrated the kick-off of the restart of operations at Boss Mining with a ceremony held at its concession on 23 November.  

The restart focussed on processing historically mined fines and plans were for production to ramp up to full capacity of 21.6ktpy Cu cathode and 3.6ktpy Co hydroxide by March 2023.  Boss previously produced cobalt carbonate as an intermediate suggesting that the owners have made changes to the flowsheet.  

The suspension comes amidst seemingly growing tensions between the DRC Government and some foreign entities operating in the DRC copper belt. Things have only just been resolved at Tenke Fungurume (owned by CMOC), following last year’s suspension of copper and exports amidst a row over royalties. Meanwhile, recent reports suggest that the DRC is looking to boost its stake in the Sicomines cobalt and copper joint venture with a consortium of Chinese firms from 32% to 70% in response to a growing sense that the country was short-changed in the 2008 infrastructure-for-minerals deal which placed the asset into the hands of the Chinese group. 

Boss Mining's suspension is unlikely to impact the cobalt market much as things stand but could remove ~2-3kt of material from an oversupplied market in 2023, depending on how long the suspension lasts. This, however, won't make much of a dent in the prevailing oversupply situation. Project Blue estimates that there is somewhere in the region of 45kt of cobalt in hydroxide overhanging the market at present, with some key producers (such as Glencore) able to increase output considerably if desired, and with some major DRC projects set to enter production over the short-to-medium term. Meanwhile, the huge ramp-up of Indonesian HPAL continues to add more cobalt intermediate units to the market, contained in MHP.

It remains to be seen if the current low price situation will force many producers to shut down and/or bring about delays to projects. Meanwhile, market participants will be keenly watching the government's next moves, as it seemingly ramps up it activity in the mining sector ahead of elections in December.