Kamoto Underground Copper Mine, Kolwezi, Congo. Image by Dave Dyet via Flickr.
A dispute about royalties between local tax officials and a copper mine in the Democratic Republic of the Congo, owned by Glencore Plc, has arisen.
According to persons familiar with the situation, the government organisation, DGRAD in French, claims that Kamoto Copper Co. owes the Congolese government somewhat more than €800 million ($894 million). The tax collection team this week temporarily sealed off a warehouse where the business was keeping metal, the people said, asking not to be identified because the material was confidential, following the freezing of the unit’s local bank accounts earlier this year.
According to government data, Kamoto, one of the biggest mines in Congo, exports 16,000 tonnes of cobalt and 200,000 tonnes of copper in 2023. The Swiss commodities giant owns a 75% stake in Kamoto. The conflict, according to the people, has not harmed the mine’s output of cobalt and copper.
In the first half of the year, it produced 11,700 tonnes of cobalt and 89,000 tonnes of copper. In the Congo, Glencore also manages a second copper-cobalt project.
In an effort to “clarify the situation” and protect “both the business climate and the interests of the state,” the government is examining Kamoto’s financial records, according to a spokesman for the finance ministry, which is in charge of DGRAD. The ministry could not offer any more details.
A representative for Glencore declined to address the disagreement. As per the company’s disclosed information, Kamoto paid $2.3 billion in taxes and royalties in Congo between 2021 and 2023.
Tax agency representatives went to the Kamoto warehouse in Kolwezi, the mining capital, on Tuesday to shut it down, but the facility was reopened the next day and business resumed as usual, according to the sources. After talks between the two sides failed to produce a compromise, the tax agency decided to impose restrictions on bank accounts and seize property, they continued.
Congo just surpassed Peru to take the second place in the world’s copper production rankings. Copper is essential to the transition to green energy, and Congo’s exports of the metal have more than tripled since 2015. Additionally, the nation is by far the largest producer of cobalt, contributing around 75% of the world’s total production in the previous year.
(By William Clowes, Michael J. Kavanagh and Thomas Biesheuvel)
