Copperbelt set to bask in jobs again

ZAMBIA’S mining sector is set to continue on a recovery path with 5,000 new jobs expected to be created on the Copperbelt next year by China Non-Ferrous Corporation Africa (NFCA) when its US$832 million South East Ore Body (SEOB) project in Chambishi becomes operational.

Thousands more jobs will be created by Mopani Copper Mines (MCM) at its operations in Kitwe and Mufulira through multi-million dollar investments that will certainly change the economic status of the Copperbelt Province.

MCM Plc, a unit of global commodity trader and Switzerland-based Glencore Xstrata, will receive investment of over US$1.1 billion from Glencore to sink three copper mine shafts with new technology that will extend the mine’s life by over 25 years.

Glencore plans to make the investments between now and 2018, and it is expected that MCM will be turned into a world-class mining operation by 2023. And NFCA, which has 3,000 employees, is developing an underground mine located within the Chambishi Mine licence area, about seven kilometres south-east of the main ore body.

The jobs galore will not only benefit unemployed Copperbelt youths but also the workers who recently lost jobs in the mining sector due to falling copper prices on the international market. The development of the SEOB project is in line with the development agreement signed in 1998 between government and NFCA, covering three ore bodies that include the main one and the west ore body.

Known reserves for the SEOB lie between 550 metres and 1,200 metres deep and the designed annual copper ore production capacity is 3.3 million tonnes containing 60,000 tonnes of copper. NFCA chief executive officer Chunlai Wang says the 5,000 jobs to be created will be for Zambians and that the company’s copper output is also expected to reach 100,000 tonnes from 30,000 tonnes per year when the SEOB project starts full production.

Mr Wang says although there is a positive trend in employment levels, diminishing mineral resources at NFCA’s main ore body could result in reduction in employment levels hence the development of new projects. “In order for NFCA to increase productivity and profitability and ensure continued and guaranteed revenue contribution to the government and the local community, we are developing the South East Ore Body with an investment of US$832 million.

“The company endeavours to develop and operate the South East Ore Body project to process the ore deposit to concentrate stage. At full production, the project is expected to employ 5,000 Zambians,” Mr Wang shares.
According to Mr Wang, the project’s estimated contribution to the government is US$4.9 billion in 25 years, of which US$302 million will be through dividends to the Zambia Consolidated Copper Mines Investments Holdings (ZCCM-IH) for its 15 percent shareholding. And US$4.6 billion will be raked from various taxes such as the pay as you earn (PAYE), mineral royalty, company income tax and value added tax (VAT).

The company is also on top of things in terms of fulfilling its corporate social responsibility obligations by ploughing back part of its resources into communities in which it operates. NFCA has so far spent K13 million on the resettlement of residents of Mukulumpe, Twashuka and the host land areas, who were relocated to Fitanda in 2012 to pave way for the company to expand its operations.

The company has since handed over 90 houses to affected families, a health post, five classrooms with two offices, water supply facilities and two churches all valued at K13,297,500.

The massive investment in the project that guarantees jobs to the local people and those in surrounding towns has cheered Kalulushi member of Parliament Rayford Mbulu.

Mr Mbulu, who is also Deputy Minister of Foreign Affairs, says the Patriotic Front government is happy with NFCA’s project as it will greatly contribute to Zambia’s economic development. He said the 5,000 jobs that will be created when the SEOB project becomes operational, will change the lives of many Zambians who will secure employment. “As the local authority, we will support development brought to our district and the country at large,” Mr Mbulu points out.

He has commended NFCA for restoring the dignity of 90 families that were relocated to Fitanda area to pave way for the development of the multi-million dollar project. “The success of the project shows what can be achieved when all stakeholders share a common vision,” Mr Mbulu says of the SEOB project, whose exploration works were done between 2008 and 2011.

With the job losses which recently embroiled the mining sector resulting in MCM retrenching over 4,000 workers with Chibuluma Mines and Konkola Copper Mines also trimming part of the workforce, NFCA’s move is most welcome. Mineworkers Union of Zambia general secretary Joseph Chewe says mine unions will always support investments that are aimed at creating jobs for Zambians and contributing to national economic development. “We’ll always support such investments. So many Zambians will be employed and it will boost the country’s revenue from the mines. We would like to commend NFCA for such a massive project,” Mr Chewe notes.

And Jonathan Bwalya, a school-leaver residing in Chambishi, says young people in the area are anxiously looking forward to the completion of the project so that they can get employed at the new project. “We can’t wait to get permanent jobs at this mine. We are tired of working for contractors who pay us peanuts which can’t even sustain us,” Mr Bwalya says.

NFCA is a large-scale mining company operating in Kalulushi district on the Copperbelt and is co-owned by China Non-Ferrous Metal Mining Company Limited (CNMC) and ZCCM-IH. CNMC is the major shareholder in NFCA with 85 percent stake, while ZCCM-IH holds 15 percent shares.

NFCA acquired Chambishi Mine in 1998, and in 2000 it embarked on the refurbishment of its underground and surface facilities at a cost of US$160 million.

Chambishi Mine started as an open pit mine in 1965 but was closed in 1978. Underground mining started in 1974 but was closed in 1987 and the mine was placed under care and maintenance due to high production costs.
In October 2002, NFCA, which holds a large-scale mining licence, commenced production of copper concentrates.
So far, the main ore body and the west ore body are fully developed with the maximum production capacity of two million tonnes of copper ore per year containing 32,000 tonnes of copper.
The mining sector accounts for almost 70 percent of Zambia’s export earnings and remains the major productive industry which has attracted over US$8 billion in investments.

Source: Daily Mail Zambia

Low copper prices push ZCCM IH in deep losses in 2015

ZCCM Investments Holdings Plc has reported a loss after tax of K987 million for the year ended 31 March 2015. ZCCM-IH reported a Group operating loss of K2.2 billion in 2015 compared to an operating profit of K871 million in 2014.

The firm blamed the losses to the fall in Copper prices which dropped from USD 6,289 in 2014 to USD 4,701 in 2015.

As a result, dividend income was only K45 million in 2015 compared to K803 million in 2014, amid declined revenues and production, in most of ZCCM-IH’s investee companies.

The operating loss in 2015, was mainly as a result of an impairment loss of K2.1 billion, recognized in respect of amounts receivable from Konkola Copper Mines of K719 million and Lubambe Copper Mines of K705 million.

A further impairment of K513.8 million was recorded, as a result of a decline in the fair value of the investment in KCM, in view of continued challenges at the mine.

And on improved copper prices, ZCCM – IH says copper prices have continued to be depressed in the recent past, and recovery is slow.
“The copper price has recently shown some recovery, however, it is expected that the impact on revenue will be slow. Hence, in order to move from relying on passive income and being dependent on mining, we have embarked on diversifying our investment portfolio, by actively looking for investment opportunities beyond mining, into other sectors such as energy, agriculture and real estate, so that the company can create and maximize shareholder value,” it said.

It added, “For instance, in energy, the Maamba Project is expected to be completed in June this year. ZCCM-IH owns 35% of Maamba Collieries Limited. ZCCM-IH and its partner have invested close to USD 850 million at Maamba Collieries Ltd, into this thermal power plant which will be producing 300MW of power.”

“Further, the recapitalization of Ndola Lime Company Limited has advanced, with the project undergoing hot commissioning. ZCCM-IH is reviewing the operations of Ndola Lime with a view to streamlining its operations and make it competitive and efficient.”

It added, “As part of diversification into real estate, ZCCM-IH recently acquired an investment property that will be leased out to generate passive income. ZCCM-IH has also been identifying a number of strategic legacy properties, with a view of bringing them to use and turn them into income generation projects. Further, ZCCM-IH is currently looking for strategic partners to invest in agricultural projects.

And Lubambe Copper Mine also reported revenue for the financial year ended 31st march 2015, at K1, 071 million as compared to K1,483 million in 2014.

It also reported a loss for the same period of USD78 million, compared to USD39 million in 2014.

The main challenge that Lubambe faced during the financial year under review was the dilution of concentrates.

Due to the above financial and operational challenges, Lubambe was unable to make repayments on the K705 million shareholder loan, and this loan was thus fully impaired as at 31st march 2015.

The way forward is to pursue the rights of ZCCM-IH PLC under the shareholder loan agreement.

On Konkola Copper Mines, the firm reported a net loss of USD178.5 million for the financial year ended 31st March 2015, compared to USD89.2 million loss in 2014.

Revenue reported for the year, was USD1, 077.1 million, down 15.0% (2014: USD1, 271.4 million) due to a decline in the sale of copper and copper related products.

Further, copper sales declined by 15.9% and sale of precious metals in slimes declined by 33.9%.
Total finished copper production during the year was 168,923 MT compared to 177,018 MT in 2014.

During the year under review, KCM faced acute operational and financial challenges including cash flow constraints that resulted in KCM purchasing third party concentrates in smaller quantities than what was sought. KCM is currently focusing on increasing production volumes, and addressing productivity across all of its operations.

To this end, KCM has been implementing various interventions, to improve the overall operating performance and drive higher equipment availability and utilization.

Source: Lusaka Times

Statement to the media on ZCCM-IH financial performance for 2014/15

Lusaka, Zambia – ZCCM Investments Holdings Plc (ZCCM-IH) group reported a loss after tax, of K987 million for the year ended 31 March 2015.

However, during the previous year ended 31 march 2014, the group recorded a profit of K277 million.

At Company level the loss was K639 million in 2015 versus a profit of K893 million in 2014.

As a result of the good performance in 2014, ZCCM-IH declared and paid a dividend of K1.56 per share, totaling K256 million, equivalent to about USD 40 million.

This was a record dividend in the history of ZCCM-IH, as it had never paid any dividend since its inception.

In 2015 however, a number of factors impacted the performance of the group.

Copper prices continued to decline falling from USD6,289 in 2014 to USD 4,701 in 2015.

As a result, dividend income was only K45 million in 2015 compared to K803 million in 2014, amid declined revenues and production, in most of ZCCM-IH’s investee companies.

ZCCM-IH reported a Group operating loss of K2.2 billion in 2015 compared to an operating profit of K871 million in 2014.

The operating loss in 2015, was mainly as a result of an impairment loss of K2.1 billion, recognized in respect of amounts receivable from KONKOLA COPPER MINES (KCM), of K719 million (USD94.9million) and LUBAMBE COPPER MINES of K705 million (USD93 million).

A further impairment of K513.8 million was recorded, as a result of a decline in the fair value of the investment in KCM, in view of continued challenges at the mine.

LUBAMBE COPPER MINE (LCM)

Lubambe Copper Mine (LCM) Limited reported revenue for the financial year ended 31st march 2015, at K1, 071 million or USD164.7 million as compared to K1,483 million or USD237 million, in 2014. It also reported a loss for the same period of USD78 million, compared to USD39 million in 2014.

The main challenge that LCM faced during the financial year under review was the dilution of concentrates. Following an extensive ore body stoping design review conducted by SRK consulting, Lubambe evaluated various slot development methods and equipment requirements, with the recommended solution being inverse raise, using 3x SANDVIK dl411-15 long hole drill rigs.

Due to the above financial and operational challenges, LCM was unable to make repayments on the K705 million (USD93 million) shareholder loan, and this loan was thus fully impaired as at 31st march 2015.

The way forward is to pursue the rights of ZCCM-IH PLC under the shareholder loan agreement.

KONKOLA COPPER MINES

For KCM, it reported a net loss of USD178.5 million for the financial year ended 31st March 2015, compared to USD89.2 million loss in 2014.

Revenue reported for the year, was USD1, 077.1 million, down 15.0% (2014: USD1, 271.4 million) due to a decline in the sale of copper and copper related products.

Further, copper sales declined by 15.9% and sale of precious metals in slimes declined by 33.9%. Total finished copper production during the year was 168,923 MT compared to 177,018 MT in 2014.

During the year under review, KCM faced acute operational and financial challenges including cash flow constraints that resulted in KCM purchasing third party concentrates in smaller quantities than what was sought. KCM is currently focusing on increasing production volumes, and addressing productivity across all of its operations.

To this end, KCM has been implementing various interventions, to improve the overall operating performance and drive higher equipment availability and utilization.

BRIEF OUTLOOK

ZCCM – IH core assets lie in the mining sector, and this makes about 80% to 90% of our portfolio. Since privitisation, ZCCM-IH has relied on dividend pay-outs largely from mining firms. Copper prices have continued to be depressed in the recent past, and recovery is slow. The copper price has recently shown some recovery, however, it is expected that the impact on revenue will be slow.

Hence, in order to move from relying on passive income and being dependent on mining, we have embarked on diversifying our investment portfolio, by actively looking for investment opportunities beyond mining, into other sectors such as energy, agriculture and real estate, so that the company can create and maximize shareholder value.

For instance, in energy, the Maamba Project is expected to be completed in June this year. ZCCM-IH owns 35% of Maamba Collieries Limited. ZCCM-IH and its partner have invested close to USD 850 million at Maamba Collieries Ltd, into this thermal power plant which will be producing 300MW of power.

Further, the recapitalization of Ndola Lime Company Limited has advanced, with the project undergoing hot commissioning. ZCCM-IH is reviewing the operations of Ndola Lime with a view to streamlining its operations and make it competitive and efficient.

As part of diversification into real estate, ZCCM-IH recently acquired an investment property that will be leased out to generate passive income. ZCCM-IH has also been identifying a number of strategic legacy properties, with a view of bringing them to use and turn them into income generation projects.

Further, ZCCM-IH is currently looking for strategic partners to invest in agricultural projects.

These are some of the efforts aimed at reducing dependence on revenue from the copper industry, and mitigating the impact from its cyclical nature.

-Ends-

NOTE TO THE EDITOR:

About ZCCM Investments Holdings Plc

ZCCM Investments Holdings Plc is NOT “Zambia Consolidated Copper Mines Limited”.

ZCCM Investment Holdings PLC is an investments holdings company stemming from the then Zambia Consolidated Copper Mines limited (incorporated in 1982), a copper mining conglomerate that operated more than 10 mines. In 2000, Zambia Consolidated Copper Mines limited was privatized; its mines were unbundled and sold off as separate entities to the private sector.

In its place a new company – ZCCM Investments Holdings Plc – was formed, as an INVESTMENTS HOLDINGS COMPANY. In this new company, ZCCM is a name, it does not stand for anything as was the case previously.

ZCCM-IH is currently triple listed on 3 stock Exchanges: (Primary listing) the Lusaka Stock Exchange where it is the largest company by market capitalization and on the (Secondary Listing) London Stock Exchange and the Euronext (Paris – Marche Libre).

Government holds directly about 17.25% shares and its 60.28% shares is held through the Industrial development Corporation (IDC) in Zambia, with the remaining 22.47% held by institutional and private individual shareholders.

ZCCM-IH currently has an investment portfolio of 15 companies, including biggest mines such as Kansanshi Mining Plc, Mopani Copper Mines Plc and Konkola Copper Mines Plc. Its shareholdings in the 15 companies range from 10% to 100%, with commodities and services that are diversified in nature, including copper, gold, cobalt, coal and power, telecommunication, limestone, mining consultancy, financial services and gemstones.


For media inquiries, please contact:

Loisa Mbatha-Kakoma kakomal@zccm-ih.com.zm
Public Relations Manager +260 211 221023

Konkola Copper Mines reopens health facility in Chililabombwe

[fusion_builder_container hundred_percent=”yes” overflow=”visible”][fusion_builder_row][fusion_builder_column type=”1_1″ background_position=”left top” background_color=”” border_size=”” border_color=”” border_style=”solid” spacing=”yes” background_image=”” background_repeat=”no-repeat” padding=”” margin_top=”0px” margin_bottom=”0px” class=”” id=”” animation_type=”” animation_speed=”0.3″ animation_direction=”left” hide_on_mobile=”no” center_content=”no” min_height=”none”][fusion_dropcap color=”” boxed=”yes” boxed_radius=”50%” class=”” id=””]O[/fusion_dropcap]ver 11,800 residents of Chililabombwe’s Mine Township, the RB and Helen Kaunda settlements will access quality healthcare closer to their homes following the reopening of a Health Centre 4 in the copper mining town.

Commissioning the refurbished facility, Deputy Minister of Tourism and Arts, Esther Banda, who is also Chililabombwe Member of Parliament said the facility would impact positively on the lives of employees and residents.

“The reopening of clinic 4 will increase the number of people benefiting directly from KCM health services to over 70,000 people,” Mrs Banda said. KCM currently operates two major hospitals and 14 clinics in Chililabombwe, Nampundwe, Kitwe and Chingola which provide health care services to over 63,000 people.

Mrs. Banda said the reopening of the health centre was in line with the government policy to bring quality health care closer to communities.

My government is keen on fostering public private partnerships (PPPs) in all areas of development, including health as this is the most robust way of ensuring sustainable development,

Mrs. Banda said.

The Deputy Minister commended KCM for complementing the government’s efforts to provide quality health care to employees and communities around its mining areas.

Speaking at the same function, KCM Chief Executive Officer Steven Din said reopening Health Centre 4 was symbolic of KCM’s continued focus to deliver quality health care to the people in the communities in which it operates.

Mr. Din said KCM would continue to support the health sector as a healthy population was essential for supporting higher production in the mining industry.

I am aware that the government cannot on its own meet the demands for health service delivery. Therefore, the private sector has a major role to play in providing quality health services and KCM will continue to take a lead in this area,

Mr. Din said.

Kangwa Chirwa, a miner’s spouse and mother of two, said the facility would not only improve the healthcare of the community but would ease the burden of people walking more than two kilometres to the nearest health facility.

“I am very happy because I experienced the difficulties of walking long distances to the nearest clinic. It was more difficult when a mother fell ill at the same time as her child. It meant she would not be able to go to the clinic, thereby worsening the illness. But I thank KCM that we now have a clinic close to our homes,” she narrated.

KCM spent k800,000 on the rehabilitation works which included reinforcing the foundation of the building, replacing the roof and ceiling, improving water reticulation and sanitation facilities. Other works were done on the Antenatal, VCT and main consultation rooms. The clinic offers free VCT, under-five clinic and family planning services.
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Gemfields achieves record price per emerald carat at auction

JOHANNESBURG (miningweekly.com) – Aim-listed Gemfields has achieved a record price per higher-quality carat at its latest emerald auction, held in Lusaka, in Zambia, from March 30 to April 3.

Revenue of $33.1-million was generated through the sale of 469 000 ct of predominantly higher-quality rough emeralds extracted by 75%-owned Kagem Mining, in Zambia.

The auction, which placed 558 000 ct on offer, achieved a new record of $70.68/ct overall average value for the emeralds sourced from the Kagem mine.

“Our return to Lusaka has delivered another strong – and indeed record – result at a time when global commodity and diamond prices remain volatile and uncertain. Demand for – and prices of – emeralds clearly remain as robust as ever and gemstone mining represents one of the healthier segments of the sector,” Gemfields CEO Ian Harebottle said in a statement on Monday.

Thirty-three companies placed bids in Gemfields' third auction of Kagem production in the current financial year, with 16 of the 18 lots on offer sold.

Gemfields has hosted 21 Kagem auctions since July 2009, generating an aggregate $412-million in revenue.

The auction also included the offering of 9.4-million higher-quality amethyst carats from 50%-owned Kariba Minerals, of which 6.6-million carats had been sold, generating revenue of $220 000 at an average realised price of $0.03/ct, with 8 of the 14 lots on offer sold.

The amethyst auction was Gemfields’ fourth, with previous auctions taking place in Jaipur, in India, in March 2011, Lusaka in February 2015 and Singapore in September 2015.

Gemfields' next auction, scheduled for May, in Jaipur, would comprise mostly lower-quality emerald and beryl sourced from Kagem.

Source: Mining Weekly

KCM appoints Mrs Chimango Chikwanda as Vice President Human Capital Management

[fusion_builder_container hundred_percent=”yes” overflow=”visible”][fusion_builder_row][fusion_builder_column type=”1_1″ background_position=”left top” background_color=”” border_size=”” border_color=”” border_style=”solid” spacing=”yes” background_image=”” background_repeat=”no-repeat” padding=”” margin_top=”0px” margin_bottom=”0px” class=”” id=”” animation_type=”” animation_speed=”0.3″ animation_direction=”left” hide_on_mobile=”no” center_content=”no” min_height=”none”][fusion_dropcap color=”” boxed=”yes” boxed_radius=”50%” class=”” id=””]K[/fusion_dropcap]CM is pleased to announce the appointment of Mrs. Chimango Chikwanda as Vice President Human Capital Management effective 1st April 2016.

She joins KCM from ZANACO where she made significant contributions to the cultural transformation of the largest retail bank in Zambia. She has over 20 years’ experience in strategic and operational Human Resource with other ‘ best-in-class’ multinationals such as Zain Zambia, SABMiller and Pricewaterhousecoopers.

Mrs. Chikwanda holds a BSc in Economics from the University of London, a MSc in Economics from the university of Warwick, an MS degree in Consultancy and Coaching for Change from HEC (Paris) in partnership with Oxford University and is a certified MBTI and Belbin practitioner.

Her predecessor, Mr. Njovu leaves KCM after completing close to two years in the role where he has provided leadership to the KCM function and maintained cordial relations with the unions.

Management has thanked Mr. Njovu for his contribution to the organization and wishes him well in his future endeavors.[/fusion_builder_column][/fusion_builder_row][/fusion_builder_container]