Toronto listed Katanga Mining’s subsidiary, the Kamoto Copper Company (KCC), has temporarily suspended the sales and export of cobalt from its Kamoto project in the DRC.
According to a press release by Katanga, the levels of uranium detected in the cobalt hydroxide produced at the Kamoto, exceed the acceptable limit allowed for export of the product through main African ports to customers.
To date, the total cobalt production impacted by the sale suspension amounts to 1 472 tons of finished cobalt. The company says that the low levels of radioactivity detected in the uranium to date do not present a health and safety risk.
Production of cobalt at the Kamoto Project is expected to continue without reduction in the quantity produced. Katanga says that KCC is conducting additional surveys to identify the source of the uranium and exploring various options to mitigate the impact of the sales suspension.
According to the company KCC will construct an ion exchange system that costs about USD25-million which will remove uranium from the cobalt. The ion exchange system is expected to be commissioned by the end of the second quarter 2019 subject to obtaining the necessary approvals. The finished cobalt production will be stored on site and processed in the ion exchange system once construction is completed. Once the system is commissioned, the processing and sale of the cobalt stored on site is expected to be completed before the end of the fourth quarter of 2019.
The temporary suspension of cobalt sales is expected to negatively impact Katanga’s revenue during the fourth quarter of 2018 and in the first and second quarters of 2019. The revenue that would otherwise be recognised on cobalt sales during the fourth quarter of 2018 and the first and second quarters of 2019 is expected to be realised in the third and fourth quarters of 2019.