Chemaf Scraps Norin Mining Deal Amid US-China Mineral Tensions
Copper and cobalt producer Chemaf Resources Ltd. has abandoned its planned sale to Norin Mining Ltd., marking a potential victory for US efforts to curb China’s influence over global mineral supply chains.
The deal collapsed after Democratic Republic of Congo (DRC) authorities failed to approve the transaction, according to a source familiar with the matter.
Chemaf, backed by commodity trader Trafigura Group, informed creditors that the sale to Norin—a subsidiary of China’s state-owned Norinco Group—would not proceed.
Congo’s state-owned mining company, Gécamines, which holds the permit for Chemaf’s Mutoshi cobalt project, had opposed the acquisition since its announcement nine months ago, citing its right to approve any change in ownership.
Although Chemaf initially claimed government backing for the deal in June, senior officials later signaled opposition.
While Chemaf produces modest amounts of copper and cobalt, the failed transaction holds strategic significance as the US seeks to counter China’s dominance in critical minerals.
Washington had urged Congo’s government to block the deal, with Republican lawmakers publicly warning against allowing Norinco’s involvement.
Since February, Congo has been offering the US exclusive access to critical minerals and infrastructure projects in exchange for security assistance, as it confronts a rebellion backed by Rwanda.
Chinese companies currently dominate Congo’s mining sector, which is the world’s largest producer of cobalt and the second-biggest supplier of copper.
The termination of the Norin agreement leaves Chemaf in financial uncertainty. The deal would have fully repaid its creditors, including Trafigura, but the company still requires hundreds of millions of dollars to complete its key projects.
Chemaf is now engaging with Congolese authorities to explore alternative solutions and maximize its ability to repay its estimated $900 million debt.
The company had previously secured a $600 million loan from Trafigura in 2022 to upgrade its Etoile operation and develop Mutoshi, which was designed to produce 16,000 tons of cobalt and 50,000 tons of copper annually.
Norin, the world’s fourth-largest cobalt producer, operates two mines in Congo that accounted for 3% of global cobalt output in 2023. If it had completed the Mutoshi project, it would have further expanded China’s grip on EV battery metal supplies.
Meanwhile, Gécamines—which owns the Mutoshi mining permit—made its own bid for Chemaf in October.
With its sale agreement officially lapsing on March 22, Chemaf is now searching for new investors. However, whether a new buyer will offer terms that satisfy creditors remains uncertain.
