Despite being the world's largest producer of cobalt, the DRC processes very little of it, exporting a large portion of its production to Chinese refineries. To be less dependent on China, the Central African country has been striking deals with Western countries to refine its cobalt.

In the DRC, Electra Battery Materials and Eurasian Resources Group (ERG) sealed a deal to source cobalt from the Democratic Republic Congo (DRC). Under the deal, which Electra Battery unveiled on April 2, ERG will deliver 3,000 tonnes of cobalt hydroxide per year to Electra Battery Materials starting in 2026, sourced from its Congolese operation Metalkol, to supply a refinery north of Toronto.

Electra and Eurasian Resources Group Sign Cobalt Supply Agreementhttps://t.co/aBhdGvsFyH

NASDAQ: $ELBM | TSX.V: ELBM#ElectricVehicles #Cobalt #Co #Refinery #NewsRelease #PressRelease pic.twitter.com/iYU5BdBZLx

— Electra Battery Materials Corporation (@ElectraBMC) April 2, 2024

The deal aligns with the US' strategy to secure minerals essential for its energy transition; minerals like cobalt which is primarily used in electric vehicle (EV) batteries. The deal is compliant with Electra with the U.S. Inflation Reduction Act (IRA), which provides subsidies for EV purchases. Electra's plant is expected to provide enough cobalt to power up to 1.5 million vehicles per year.

“Electra’s Canadian refinery is uniquely positioned as North America’s first cobalt sulfate refinery, with IRA-compliant feedstock to support growing EV demand. We are very proud to have ERG, one of the best cobalt hydroxide suppliers in the world, as a partner,” said Electra CEO Trent Mell.

The DRC is the world's largest producer of cobalt. However, it refines very little of its output, leaving most of the processing to China. 

Emiliano Tossou