Oil report

Huayou temporarily suspends purchases of cobalt from two Congo mines

JOHANNESBURG, Aug 12 (Reuters) - China’s Huayou Cobalt will not buy artisanal cobalt from two mines in Democratic Republic of Congo until it is sure the material they produce is free of human rights abuses according to standards to be decided by the industry.

Congo is the world’s biggest producer of the battery metal with “artisanal”, or subsistence, miners accounting for a significant proportion of global supply.

Huayou will continue to support the Better Mining programme developed by RCS Group, a company in Berlin that audits supply chains, which aims to ensure that artisanal cobalt mines do not use child labour or help fund armed groups.

The programme has already monitored the Kasulo and Kamilombe sites for two years in partnership with Huayou, China’s biggest cobalt refiner, whose Congo subsidiary used to source from those sites, among others.

But, under pressure from human rights groups, Huayou decided to temporarily stop sourcing from artisanal mines in the Congo until the industry decides on a set of standards around artisanal cobalt.

The Responsible Minerals Initiative (RMI), whose members include the world’s biggest technology and car companies, is working on establishing criteria for responsible artisanal cobalt sourcing.

The RMI aims to have the criteria ready by the end of this year, to be implemented in 2021, Leah Butler, vice president of the Responsible Business Alliance, told Reuters.

The Kasulo and Kamilombe mines, where an estimated 4,500 miners are working at the moment, could then possibly re-enter global supply chains, RCS Global CEO Nicholas Garrett told Reuters.

“Going forward there’s a good chance these mines eventually will fulfill the criteria for market acceptance,” he said.

RCS Global will monitor the sites for a further two years, it said in a statement seen by Reuters on Wednesday. The RMI covers the cost of its monitoring and data collection under a deal announced in April.

Huayou Cobalt remains committed to supporting the formalisation of Congo’s cobalt sector, Huayou’s head of corporate social responsibility Bryce Lee said in the statement. (Reporting by Helen Reid, Editing by Pratima Desai and Chizu Nomiyama)