OM whacked by UN report

Shares in Cleveland-based cobalt refiner OM Group crashed to a three-and-a-half-year low during the report period following its mention in a UN Security Council report on illegal mining activity in the Democratic Republic of Congo.

The 33-page report mostly detailed the malevolent presence in the DRC of Zimbabwean and Ugandan troops and companies, but it also included a list of Western public companies — including OM — regarded by the UN as “businesses considered to be in violation of Organization for Economic Co-operation and Development guidelines for multinational enterprises.”

OM counters that the project referenced by the UN report is only a small part of its longstanding relationship with Gcamines, the state-owned mining company, and that the panel failed to mention OM’s recent investment of more than US$100 million to build a production facility in the DRC, which created 300 new jobs. OM Chairman James Mooney adds that the company’s “track record for business relationships in the DRC [is] based on fairness, integrity and mutual respect.”

OM, which is due to release its third-quarter results on Oct. 29, dropped $8.49 over the period to US$30.90, touching a low of US$27 on Oct. 21.

With copper, nickel, zinc and aluminum prices on the rise, most of the remaining base metal miners showed gains: Anglo American rose 51 to US$13.58; BHP Billiton eased back 6 to US$10.68; Rio Tinto moved ahead $2.98 to US$73.99; Alcoa jumped $1.69 to US$23.34; CVRD was up $1.49 to US$23.63; Phelps Dodge advanced $1.86 to US$30.86; and Freeport-McMoRan rose 49 to US$12.72.