Whalesbook
Report: CMOC Mine Caused Pollution, Health Issues in DRC
A three-year investigation by the Environmental Investigation Agency (EIA) and PremiCongo claims CMOC Group Limited's Tenke Fungurume mine in the Democratic Republic of Congo (DRC) caused significant environmental and public health damage. The report focuses on CMOC's '30k plant,' which began operations in 2023. Local communities near the plant report severe health problems, including nosebleeds, respiratory issues, and pregnancy complications. Air monitoring between September 2024 and January 2025 showed sulphur dioxide (SO2) levels higher than safety standards. CMOC's subsidiary, Tenke Fungurume Mining (TFM), denies its operations caused pollution or health effects, stating its own monitoring confirms SO2 levels are within legal limits.
Cobalt Demand Surges Amid Supply Chain Scrutiny
These allegations come as global demand for cobalt, a key battery material for electric vehicles (EVs), continues to rise. The EV industry accounts for about 43% of global cobalt demand in 2024. The DRC supplies nearly half of the world's cobalt, and CMOC's Tenke Fungurume mine is a major source for battery makers in China and Europe, supplying automakers like BMW, Mercedes-Benz, Stellantis, and Volkswagen. The cobalt market is already tight due to DRC export limits imposed in early 2025 and expected to continue. These limits, potentially creating a deficit, have tightened market conditions. While some EVs use batteries with less cobalt, overall EV growth is expected to maintain strong demand.
Mine's ESG Certification Questioned After Allegations
The Tenke Fungurume mine received the Copper Mark, an ESG (Environmental, Social, and Governance) certification, in June 2024. It was the first African and Chinese-owned mine to get this standard. However, the EIA's findings directly challenge the certification's credibility, suggesting a gap between the mine's reported impacts and the assurance from ESG frameworks. This raises questions about how well current ESG certifications work in mining, especially for materials needed for green energy. Other mining companies, like Glencore, have also faced ESG issues. Vale highlights its commitment to responsible sourcing, and Zijin Mining has received high ESG ratings.
Deeper Issues: DRC Mining History and CMOC
The problems at CMOC's mine reflect long-standing concerns about cobalt mining in the DRC. Past investigations have pointed to child labor, unsafe working conditions, and human rights abuses, particularly in the artisanal mining sector. These issues can make it hard for global buyers to trace the origin of cobalt and ensure it's sourced responsibly. CMOC has published ESG reports for its TFM project, but the new allegations suggest that deeper issues may persist, potentially undermining the goals of ESG efforts. As of March 10, 2026, CMOC's market capitalization was about CNY 451.93 billion, with a TTM P/E ratio of 23.98, showing its significant market position despite these operational controversies.
Supply Chain Risks and Investor Concerns Rise
The environmental and health claims, along with the DRC's strict export rules, create significant risks for global automakers and battery manufacturers that rely on CMOC's cobalt. The market's reaction to DRC policies is clear in price swings and ongoing discussions about cobalt substitution and responsible sourcing. Investors may now look at CMOC's operations more critically, weighing its market importance against potential fines, reputational damage, and operational disruptions. The cobalt spot price in February 2026 was about US$25.53 per pound, indicating market tightness due to supply rather than just high demand. Analysts remain watchful, focusing on DRC policy decisions and their effect on the market.