Ensuring sustainability and ethical sourcing with Oracle Blockchain Platform

February 17, 2019 | 4 minute read
Mark Rakhmilevich
Vice President, Blockchain Product Management
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Ethical sourcing of minerals sounds rather abstract until you look at your mobile phone or other electronics and realize that its full of capacitors that contain trace quantities of Africa-mined tantalum – primarily sourced in Rwanda and the DRC.  Our mobile phones, game consoles, and computers may all contain traces of this mineral.

In the last 15 years major sources of this rare earth metal, whose high capacitance value per volume enables very thin capacitors for use in small devices, shifted from Australia to Africa, primarily in Rwanda and Congo.  The former has good reputation for mining, but in DRC the government controls are spotty and in some areas mining is controlled by armed rebels, which have been accused of using child labor in dangerous conditions and trading proceeds to fund weapons purchases that perpetuate the conflicts in that war-torn country.

Solving the Compliance Issues Around Ethical Sourcing of Conflict Minerals

Do you know if the tantalum capacitors in your iPhone are made from the ore that came out of the conflict zone or ones that have been ethically sourced?  Most of us never think about these kind of issues.  However, the Dodd-Frank Act in US and similar legislation around the world means that companies must trace the source of these conflict minerals and ensure they only use accredited sources.  Pity the poor purchasing or compliance managers who have to wade through stacks of signed paper forms or dozens of mind-numbing excel spreadsheets from all the companies involved in mining, refining, transportation, component manufacturing, and assembly and somehow certify end-to-end compliance with ethical sourcing. 

Enter Circulor – a UK based company that partnered with Oracle to solve this challenge using Oracle Blockchain Platform. 

In today’s world, the compliance and tracking burden falls mainly on the miners to ensure they can prove chain of custody from a certified mine all the way to refiners and component manufacturers.  In addition to potential for fraud in paper based processes, the manual tracking effort is susceptible to human errors, missed paperwork, etc.  Circulor has automated this process end-to-end providing paperless, real-time reporting with immutable blockchain records that seamlessly maintain the full chain of custody using a blockchain solution to track the bags of ore as they are tagged at the mine through the aggregation and transport to the refineries, then track the refined materials to the component makers, and the components to the OEMs.

Circulor’s Track and Trace Technology for the Mining Supply Chain

The sophisticated “Circulor Protocol” starts with facial recognition using mobile phone app and includes GPS location monitor, mass balance calculations throughout every step, container tracking, and ultimately product ID tracking using QR codes.  It’s designed to solve what is perhaps the toughest challenge in blockchain-based track and trace – linkage from physical objects to digital records.  Once a digital record and its computed hash are on the blockchain it can be safely tracked through the product journey.  But ensuring that the physical goods correspond to their digital records, particularly when bags of ore are smelted by the refinery into capacitor grade powder or metal products, such as tubes and wires, requires complex mass balance calculations and additional tracking measures to ensure that unauthorized ore is not added to the supply chain at any point.

Expediting Blockchain Infrastructure with Oracle

With all these complications, Circulor had enough to worry about without spending lots of time and effort on blockchain infrastructure.  They turned to the Oracle Blockchain Platform to provide a pre-assembled, hardened blockchain that can operate across multiple continents and multiple clouds. As Doug Johnson-Poensgen, CEO and founder of Circulor, says, “We started with the Oracle Blockchain Platform four months ago and were able to go from zero to a production system spanning multiple organizations involved in ethical sourcing of minerals within a matter of months.”  That’s Oracle’s strategy in a nutshell – making blockchain a ready-to-use production-grade infrastructure for companies that are looking to solve real challenges and would rather focus on real world applications of blockchain than the science experiment of putting one together.

What’s next for Circulor?  Electric car manufacturers who depend on ethically mined cobalt for their electric vehicle batteries.  The demand is expected to more than double in the next decade and the proportion coming from DRC is expected to rise above 70%.  Did you know that the ramp-up in electric vehicles depends squarely on ethical sourcing of cobalt from one of the most volatile countries in the world?  Stay tuned for updates on cobalt tracking using Oracle blockchain. 

To learn more about Oracle blockchain technology, please visit the Oracle Blockchain website and blockchain platform cloud service page.  To learn more about Circulor see the case study at Hyperledger or visit Circulor's website.

Mark Rakhmilevich

Vice President, Blockchain Product Management

Mark is responsible for Blockchain strategy and products. He focuses on evolving Oracle Blockchain Platform and Oracle Database Blockchain Tables in the cloud and on-premises to meet the needs of customers and partners for scalable, secure, production-ready platform to support blockchain solutions. He helps to guide customers and partners around the world in applying blockchain technology to deliver on key business outcomes – accelerating growth, reducing costs and friction in business ecosystems, reducing risk and fraud, and bringing to market innovative solutions that solve real-world societal challenges. Mark facilitates customers’ journey from rapid experimentation to live production through discovery, sharing industry use cases and best practices, and advising on solution architecture.

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