February 2019

ZCCM-IH News

ZCCM IH makes a K6 million bet on Amethyst

ZCCM IH recently charge up Mapatizya with the unveiling of equipment worth K6 million for its investment in Kariba Minerals Limited which is intended to shake up the industry.

The investment group, currently under the stewardship of Mabvuto Chipata who is Acting CEO, recently announced that it would be acquiring the remaining 50% shares in the Amethyst mine. This is one of the oldest mines of its kind in Zambia and has been operating for over 60 years.

The company’s market share has been estimated at over 90% of the amethyst originating from Zambia, with production reaching as much as 800 tonnes of commercial grade amethyst per year, making it one of the largest producers in the world, according to Mr. Chipata who gave a statement at the 67% handing over ceremony. He hopes that this investment will yield positive results for his investment company which is pursing high performance targets which will require quality sales being made by the mine.

The mining equipment investment made to the company included two tipper trucks, one excavator and one front end load. This investment would go a long away in ensuring that the mine remained a leading player in the mining industry, according to Peter Phiri who is General Manager for Kariba Minerals. The forecast increases in production is around 150% for commercial grade amethyst and 67% for ore by tonnage.

ZCCM IH has been on an investment drive and recently unveiled its 5 year strategy which the company believes will increase shareholder value over the long term. The Chart below shows the performance of the company’s shares on LuSE over the last 5 years. With the share price last peaking in December 2015, Mr. Chipata and his management team will be targeting to achieve the highs of yesteryear. The investment made in Kariba Minerals is a clear signal to the market that they are intent to grow shareholder value.

Source: FIZAMBIA
ZCCM-IH News

ZCCM-IH buys new Equipment for Kariba Minerals

The Zambia Consolidated Copper Mines-Investment Holdings ZCCM-IH has capitalised Kariba Minerals Ltd with the purchase of new equipment worth K6 million to boost amethyst production.

ZCCH-IH currently owns 50 percent of the company and is in the process of finalising the acquisition of the additional 50 percent from Gemfields Ltd.
The equipment was officially handed over to the mine yesterday by ZCCM-IH acting Chief Executive Officer Mabvuto Chipata.

Industry News

The 2018 copper production hits 861,946 tonnes

The performance of the sector was better in 2017 relative to 2018. The increase in copper production is attributed to:
i. The ramp up in Production at Kalumbila
ii. Improved plant availability and utilization at the Tailings Leach Plant at KCM coupled with higher grades
iii. Commissioning of the Synclinorium Shaft at Mopani in Kitwe has increased volume of ore being hoisted.

Copper Production (Tonnes)

Mine 2017 (Tonnes) 2018 (Tonnes)
Kansanshi Mining 250 803,96 249 532,07
Lumwana 116 170,67 101 890,03
Mopani 44 860,35 62 191,24
Konkola 84 436,08 93 165,01
Chibuluma 10 194,50 11 258,53
CNMC Luanshya 43 206,34 50 363,32
Lubambe 18 037,06 22 074,50
NFCA 27 706,22 27 644,02
Sino Metals 7 100,00 9 312,90
Kalumbila Minerals 190 913,23 223 655,12
Small Scale 5 900,71 10, 859,47
Total         799 329.12        861 946.19

below is a link to the 2018 production figures summary.

https://mines.org.zm/download/2018-production-figures-summary/

Source: Ministry of Mines and Minerals Development

ZCCM-IH News

ZCCM-IH, Urban Hotels partner

MONICA KAYOMBO and KALONDE NYATI, Lusaka

ZCCM-INVESTMENT Holding (IH) and Urban Hotel Group have partnered to invest K60 million in the construction of a mixed-development property.

The property comprises a hotel and a Food Lover’s Market retail store creating over 1,500 indirect and 300 permanent jobs, with ZCCM-IH owning 49 percent while Urban Hotel Group owning 51 percent…

Source: Daily Mail

Industry News

Arc minerals raises 2.2M pounds for copper project

Aim-listed Arc Resources has raised £2.2-million through the placing of 73.6-million units at 3p each.

Proceeds of the placing will be used to fund the continuing exploration and development work on the company’s Zamsort copper project, in Zambia, and for general working capital purposes.

Executive chairperson Nick von Schirnding said Arc was approached by two family offices, one of which was already a shareholder for further funding to progress the newly identified targets at the Zamsort copper project, in Zambia.

“This is a very good outcome for us and as a result we will be accelerating work in respect of Cheyeza West and other key targets and will start a comprehensive drilling programme as soon as possible,” said Von Schirnding.

Von Schirnding would acquire 2 333 334 placing units at a price of 3.00p a unit. Upon admission, he would have a beneficial interest representing about 2.26% of the enlarged ordinary share capital of the company.

Nonexecutive directors Don Bailey, Mumena Mushinge and Brian McMaster have also participated in the placing, and so did COO Vassilios Carellas and CFO John Forrest.

Source: Mining Weekly

Corporate Social Investment, ZCCM-IH News

ZCCIM-IH in Collaboration with the Esther Lungu Foundation Donates Fertilizer and Hands Over a Water Borehole to Lufwanyama Residents

ZCCM-IH, in collaboration with the Esther Lungu Foundation Trust (ELFT), donated 200 bags of 50kg fertilizer, in addition to a water borehole handed over to residents in Chief Lumpuma’s Chiefdom in Lufwanyama district. The 200 bag of fertilizer donation was aimed at empowering local women’s groups in the area, whose main livelihood is depended on agriculture. The water borehole will be accessed by over 1,000 residents in the area.

In her speech read on her behalf by the Lufwanyama District Commissioner, the First Lady, Mrs. Esther Lungu commended ZCCM-IH for its consistency in the implementation of the access to clean and safe water initiative throughout the country.

Investee Company News

CEC Investors in “Liquid” Windfall with ZCCM IH a Big Winner

Copperbelt Energy Corporation Plc, Energy, ZCCM-Investment Holdings Plc
Posted on February 6, 2019 at 6:59 pm.
Written by Founder Fi

Following Copperbelt Energy (CEC Plc) disposing off its 50% shareholding in CEC Liquid Telecommunication Limited (CEC Liquid Telecom) to pan-African telecoms group, Liquid Telecommunication Holdings Limited (Liquid Telecom) in October 2018, investors in the company waited with baited breath for the CFO through his subcommittee on the board to conclude deliberations for the submission of the recommended special dividend from the proceeds of the sale.

The announcement that came on 1st February 2019 of a special dividend marked a four month wait for investors. The Board of CEC approved the payment of an interim dividend of US Cents 1.9 per ordinary share which translates to ZMW 0.2267 per share according to the SENS announcement that was issued.

Investors such as ZCCM IH which has shown intent on increasing its energy investment by increasing its shareholder by 4% in November 2018, will be pleased with this development as they bought the shares at an appropriate time that will see the investment group benefit from the announcement windfall.

IDC owned ZCCM-IH now owns 24 per cent shares acquired in the November 2018 transaction. At 1.6 Billion shares in issue, ZCCM IH now owns a staggering 390 thousand shares. This translates to their payment on 4th March 2019 (the effective date of payment for the dividend) US$ 7.41 million or K 88.4 million at an exchange rate of 11.93 kwacha to a dollar.

A recap of the rationale of the investment indicates that CEC entered into a Joint Venture with Liquid Telecom as equal partners in 2011. However, 8 years later, the Owen Silavwe led management team backed by the management’s belief system of entering into a telecommunications union with Liquid Telcom led them on a path that saw the entities assets attaining the desired commercial status that was in their strategy.

Although the company does not provide clear indications as to why divesture happened last year in their statement on the disposal, Liquid Telcom’s generous acquisition now sees investors having a handsome windfall in the early months of 2019.

Source: FIZAMBIA

Industry News

Zambia’s Mining Story Shines at Cape Town Indaba

The Zambian mining story is shining on the sidelines of the ongoing Mining Indaba in Cape Town.

London Stock Exchange-listed Zamsort has scored a milestone, with its chairman Mumena Mushinge appointed director of Arc Minerals.

Arc Minerals, formerly Ortac Resources, is engaged in the identification, evaluation, acquisition and development of natural resource projects, located primarily in Africa.

Directors of Zamsort Company migrated their shares to Arc Minerals in order to raise finance and have since seen their move pay off with Mushinge’s appointment.

“Zamsort is a company which was founded in 2002 and it owns a 1, 000 square kilometre area in North Western Province. It owns an exploration licence and it has a small-scale mining licence,” Company Secretary Brian Chisala said.

“It is a hybrid project which has both mining and exploration. In order to raise finance, founders of Zamsort, Mr Munena Mushinge who is the chairman, Brian Chisala company secretary and Katambi Bulawayo, migrated their shares to Arc Minerals and AIM listed company in London to try and raise capital and collectively becoming majority shareholders in Arc Minerals…Today is quite a milestone because the chairman of Zamsort, Mr Munena Musunge, has since been appointed director to Arc Minerals, which is a very rare scenario in the mining sector on listed entities.”

Zamsort has invested about $12 million in a new project that it will commission on a pilot plant producing at least 500, 000 concentrates a month for Copper and Cobalt.

“This is particularly interesting because it is a predominantly Zambian spearheaded company and so it has been a milestone to have Mr Mushinge who has been appointed. When you look at the share pricing after the announcement, it has slightly gone up and we expect it to go up,” he said.

“We are expected to go to phase two of our drilling in 2018. We have also identified new projects in our large scale prospecting which were never discovered before by major corporations like Anglo American and Equinox.”

Source: Zambia Reports
Investee Companies

Chibuluma Ninth Best Copper Mine in World – Report

Zambia is among the world’s ten topmost producers of copper with Chibuluma Mine being on the ninth position in the world, according Mining for Zambia website.

The website says Chibuluma Mine on the Copperbelt province which has an average copper grade of three percent, is a shining example of a well-run, profitable enterprise.

“ Chibuluma, which is a relatively small mine by Zambian standards, has paid over $100 million in tax since 2007, and has had one fatality in eight years,” it adds.

The website says although only one Zambian mine makes its list, as the country’s copper grades are generally reduced after many decades of mining.

Modern Zambian mining operations have become highly efficient, to make do with reduced ore grades, and remain a major contributor to the country’s economy and exports.

The average growth of the Zambian mining industry between 2017 and 2021 is expected to be about 5.5 percent, meaning that the sector will continue to be a vital contributor to employment and the broader economy.

Topping the list is Sudbury (also known as Victoria) mine in Canada, North America where the grade of ore is nearly eight percent.

The underground mine is found in a unique geological area, caused by a meteorite crashing into earth nearly 2 billion years ago. One of Sudbury’s main shareholders is KGHM, which has its roots in a Polish state mining company.

Las Cruces Copper mine in Spain owned by First Quantum Minerals (FQM), which operates a number of mines in Zambia is second. Average copper grade at this opencast mine is five percent. Operations began in 2009 and are expected to continue until 2022.

Thanks to innovative technology at the mine, copper cathode produced at the mine is very pure. According to FQM, copper cathode produced at this mine reaches a maximum quality of 99.9 percent copper.

The Kinsenda mine in the DR Congo is third recognised. The mine is very close to Kasumbalesa, a town on the Zambian border, and is owned by a South African company, Metorex.

The average grade of copper at this mine is 4.8 percent. It is another underground mine and operations are expected to continue until 2025.

Fourth recognised is Degrussa Coppermine in Australia, and CSA mine also of Australia on the fifth position while Kinsevere open-pit Coppermine owned by MMG.in neighboring, DRC takes sixth position.

KOV Coppermine which is an opencast mine and is the largest high-grade copper operation in the world takes is seventh recognised. Its primary shareholders are Glencore and Gécamines, the Congolese state-owned mining company. The average grade of copper at KOV is 4.2 percent.

Kinsevere Coppermine also of the DR Congo and Reed Coppermine in Canada are seventh and eighth recognised copper mines in the world, respectively according to the website.

According to the same website, the copper mine with the tenth-highest grade of copper in the world is found in southern Laos, a country in south-east Asia

Source: Zambia Reports