Race to the future: what you need to know about the frenetic search for cobalt

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The clean energy revolution is replacing oil and gas with a new global force: the minerals and metals needed in electric car batteries, solar panels and other forms of renewable energy.

Places like the Democratic Republic of the Congo, which produces two-thirds of the world’s cobalt supply, for example, are taking on the kind of roles once played by Saudi Arabia and other oil-rich countries. And a race between China and the United States to secure supplies could have far-reaching implications for the common goal of protecting the planet.

An investigation by The New York Times was based on interviews with more than 100 people on three continents and on thousands of pages of financial, diplomatic and other documents. Here are some of the findings.

The US government failed to secure decades of diplomatic and financial investment in Congo, even as China positioned itself to dominate the new era of electric vehicles.

The sale, which began in 2016, of two large cobalt reserves in Congo by a US mining giant to a Chinese conglomerate marked the end of every major US cobalt mining presence in the country.

Chinese battery manufacturers have made agreements with the mining companies to ensure a steady supply of the metal.

Last year, 15 of Congo’s 19 cobalt-producing mines were owned or financed by Chinese companies, according to a data analysis. The companies had received at least $12 billion in loans and other financing from state-sponsored institutions, and are likely to have attracted billions more.

The five largest Chinese mining companies in Congo that focus on cobalt and copper mines also had credit lines from Chinese state banks totaling $124 billion.

One of the government-backed companies, China Molybdenum, which bought the two US reserves, described itself in The Times as “a pure corporate entity” traded on two exchanges. Data shows that 25 percent of the company is owned by a local government in China.

The Congolese are reviewing previous mining contracts with US government funding as part of a wider fight against corruption. They are also investigating whether Chinese promises to build roads, schools, hospitals and other infrastructure have been fulfilled.

Separately, Chinese molybdenum is accused of withholding payments to the government at the Tenke Fungurume cobalt and copper mine. The company said it had done nothing wrong and wondered if there was an organized attempt to undermine it.

China has an idiom that goes something like, “Where there is the will to condemn, evidence will follow,” a spokesman said. “I have a vague feeling that we may be getting caught up in the game of greater powers.”

Tenke Fungurume, one of the largest cobalt mines in the world, was controlled by an American company, Freeport-McMoRan. It was then sold in 2016 in a series of transactions worth $3.8 billion to China Molybdenum. The sale was aided by a Chinese investment company that bought out a minority shareholder in the mine.

One of the founders of the private equity firm was Hunter Biden, the son of the US president. According to Chinese financial documents, a Washington company controlled by Mr. Biden remains a shareholder of the company. Chris Clark, an attorney for Mr. Biden, said his client “no longer has any interest, direct or indirect,” in the firms in Washington and China. Reports in China show that he is no longer a board member of the Chinese company. Mr Biden did not respond to requests for comment.

When asked if the president had been made aware of his son’s connection to the sale, a White House spokesperson said, “No.”

The increased mining and refining of cobalt by Chinese companies has helped meet the growing demand worldwide. But at least a dozen workers or contractors at the Tenke Fungurume mine told The Times that the Chinese ownership had led to a drastic decrease in safety and an increase in injuries, many of which went unreported to management.

The company said the complaints were likely fabricated and that it had actually increased security.

As the world turns towards an electric vehicle future, the United States is catching up, although both Congress and the Biden administration are now taking the first steps. On Friday, the House passed legislation that would provide more than half a trillion dollars for the US economy’s shift from fossil fuels to renewable energy and electric cars.

Amos Hochstein, the State Department’s senior adviser for global energy security, predicts that access to solar panels and batteries for electric vehicles will determine energy security in the future.

“It is a national security imperative that the United States ensures that the 21st century does not repeat the vulnerabilities of the 20th century,” he said.

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