A US-backed consortium is in the final stages of acquiring stakes in Glencore’s (LSE:GLEN) copper-cobalt assets in the Democratic Republic of the Congo (DRC), as Washington seeks to strengthen its access to critical minerals.
Orion Critical Mineral Consortium (Orion CMC) announced plans in February to acquire a 40% stake in Glencore’s interests in the Mutanda and Kamoto mines in Lualaba province, in a deal that would value the assets at approximately US$9 billion ($12.8 billion).
The consortium is led by US investment firm Orion Resource Partners.
Orion Resource Partners CEO Oskar Lewnowski tells Bloomberg that the proposed transaction is now in its “final phases”.
Glencore currently holds 95% of Mutanda and 75% of Kamoto, both major producers of copper cathodes and cobalt hydroxide.
US seeks alternative supply chains
Orion CMC was established by Orion Resource Partners last October, with backing from Abu Dhabi’s ADQ and the US International Development Finance Corporation (DFC).
The consortium aims to invest more than US$5 billion in critical minerals projects to support supply chain diversification for the US and its allies.
According to Lewnowski, Orion is also holding discussions with Asian allies about joining the consortium as it seeks to reduce reliance on China for strategically important minerals.
“We’re not looking to compete with China,” Lewnowski says.“We’re just looking to create a supply chain that doesn’t allow for monopolistic behaviour by any one country.”
The proposed Glencore transaction would give the consortium exposure to two major African mines.
Together, Mutanda and Kamoto produced 247,800 tonnes of copper last year – accounting for roughly 30% of the group’s global output – along with 35,500 tonnes of cobalt.
DFC Chief Executive Officer Ben Black previously highlighted the potential benefits of the Orion-Glencore partnership, saying it could deliver “significant returns” for both the US and DRC.
Glencore also recently joined the Project Vault initiative, with US$500 million in financing commitment to help secure mineral supplies for US manufacturers.
More deals in the pipeline
Beyond the DRC, Orion CMC is pursuing additional mining investments in Canada, Indonesia, and Vietnam, according to Lewnowski.
The consortium is also advancing a proposed equity investment in Lifezone Metals’ (NYSE:LZM) Kabanga nickel project in Tanzania, which Bloomberg first reported in August.
Meanwhile, a transaction to back US firm Virtus Minerals’ acquisition of Chemaf — another copper-cobalt miner in DRC — is also being touted as a possibility, says Lewnowski.
Write to Jackson Chen at Mining.com.au
Image: Glencore
