ZESCO Limited has entered into a long-term agreement with Konkola Copper Mines following successful conclusion of negotiations, says director strategy and corporate services Patrick Mwila.

In a statement yesterday, Mwila stated that the agreement between Zesco and KCM was part of the power utility’s long-term strategy of correcting imbalances in the power supply chain.

According to Mwila, the artificial imbalances were the result of the Bulk Supply Agreement that was signed between Zesco and Copperbelt Energy Corporation on November 21, 1997 which had been “commercially disadvantageous to Zesco” and which expired on 31 March 2020.

Mwila stated that the imbalances were aided by certain clauses that ensured only CEC could supply the lucrative Copperbelt mining market ever since the BSA was signed in 1997.

“It is also in line with the government’s new policy framework, which supports an open Electricity Supply Industry that is intended to encourage participation of various players in the three key segments of the value chain, i.e. Generation, Transmission and Distribution. The future is brighter for the electricity trade if new entrants are free to setup a power plant, negotiate for direct supply with any willing consumer and request and negotiate for the wheeling (or transportation) of their power with owners of infrastructure on commercial terms across all transmission and distribution lines as long as capacity is available, and regardless of the ownership,” according to the statement.

“By eliminating monopolistic tendencies, the Zambian electricity sub-sector will soon realise efficiencies, as neither Zesco nor any other owner of transmission or distribution infrastructure can claim exclusivity for their use as third parties will be able to supply power across Zambia. Zesco welcomes this competitive environment and the opportunity to prove that it can compete on a level playing field with the best competitors in the market.”

Mwila stated that specifically, Zesco was now in a position to compete for the supply of power directly to those mining consumers in the Copperbelt that were able and willing to enter into new commercial relationships.

He stated supply to such consumers was previously the preserve of CEC.

“…but with the lapse of the BSA, the consumers, Zesco and CEC are free to buy and sell power from anywhere and supply to anyone as long as the terms are commercially competitive. Zesco also notes that under these circumstances, Zesco’s traditional consumers may also be subject to competitive bids or solicitations from other potential suppliers, but we firmly support the new market framework and we are ready to prove that we can supply power more competitively than anyone else in the Southern African region,” Mwila stated.

“The agreement between Zesco and KCM confirms Zesco’s and the Government of Zambia’s commitment to supporting the whole of Zambia’s mining sector and to ensuring supply of all consumers in the Copperbelt.”

Mwila hailed the development as a “landmark agreement for Zesco and Zambia as a whole” that ensures that Zesco, Zambian economy and by extension, the Zambian public were able to benefit from direct commercial agreements between the utility and potential generators of foreign exchange.

He stated that the “common carrier” declaration typically unlocks resources and avoids “hoarding” of transmission capacity or even worse, duplication of infrastructure by competing players in the ESI.

“Transmission and distribution asset owners still remain fully in charge of their assets, but they must negotiate wheeling arrangements on commercial terms once they are approached by parties intending to trade. The law thus prevents any party from using its vantage point to block commercial trade and stipulates that if the parties fail to agree on wheeling terms for the power, any aggrieved party may then appeal to the Electricity Regulation Board to arbitrate and determine fair terms and conditions of supply,” Mwila stated.

And Mwila stated that despite initial failure to finalise a new power supply agreement to replace the now expired BSA with CEC, Zesco continues to make power available to CEC to allow it to continue supplying its consumers who have already contracted for power supply and to supply Zesco’s existing consumers in the Copperbelt.

“This is despite the fact that CEC continues to owe Zesco millions of dollars in unpaid arrears under the recently expired Bulk Supply Agreement,” stated Mwila.

 Source: https://www.themastonline.com/2020/06/07/zesco-announces-long-term-power-supply-agreement-with-kcm/

ZESCO Limited has entered into a long-term agreement with Konkola Copper Mines-KCM following successful conclusion of negotiations that have corrected the imbalances in the power supply chain.

ZESCO Limited Director for Strategy and Corporate Services Patrick Mwila says the artificial imbalances were as a result of the Bulk Supply Agreement that was signed between ZESCO and Copperbelt Energy Plc -CEC- on November 21, 1997.

Mr. Mwila says this had commercially disadvantaged ZESCO before it expired on March 31 2020.

He has however assured the nation that the future of electricity trade in the country is bright following the correction of the imbalance in the supply chain.

And Mr. Mwila says by eliminating monopolistic tendencies, the Zambian electricity sub-sector will soon realize efficiencies because neither ZESCO nor any other owner of Transmission or Distribution Infrastructure can claim exclusivity rights for their use as third parties will be able to supply power across Zambia.

He says ZESCO welcomes the competitive environment and the opportunity to prove that it can compete on a level playing field with the best competitors on the market.

Mr. Mwila says ZESCO is now in a position to compete favorably for the supply of power directly to the mining consumers on the Copperbelt who are able and willing to enter into new commercial relationships which was previously the preserve of -CEC-.

He further explained that with the lapses of the agreement the consumers, ZESCO and CEC are free to buy and sell power from anywhere and supply to anyone as long as the terms and conditions are commercially competitive.

Mr. Mwila adds that the new agreement between ZESCO and KCM confirms ZESCO and Government’s commitment to supporting the whole of Zambia’s mining sector and to ensuring supply to all consumers on the Copperbelt.

He said this in a statement released to ZNBC Business News in Lusaka today.

 Source: https://www.znbc.co.zm/news/zesco-kcm-forge-partnership/

Kansanshi mining company PLC has partnered with civil society organizations in Solwezi district to work together in providing  sustainable development to foster community wellbeing in the district. 

Kansanshi mining company PLC public relations manager, Godfrey Msiska says his mining firm  has collaborated with civil society organizations to improve the standard of living of Solwezi residents. 

ZANIS report Mr Msiska in an interview said this partnership will ensure that residents in the district will be self-reliant even after the mines are done with their operations. 

Meanwhile, civil society organizations representative, Cranes Kasito said the new relationship with the mines shall benefit all stakeholders and improve capacity building initiatives offered to the community. 

Mr Kasito added that the collaboration will guarantee clear communication strategies that will help the community understand what the mines are doing for them. 

He said this in a communique presented during a two day dialogue platform held in Solwezi today, under the theme “joint action for sustainable development”.

Source: https://theglobeonline.news/uncategorized/kcm-partners-with-civil-society-for-sustainable-livelihoods-in-solwezi/

Minister of Finance Bwalya Ng’andu has said that the government has restarted negotiations with Mopani Copper Mines Plc to find a solution that will avoid the mine being placed under care and maintenance.

Dr Ng’andu said that it is not the desire of the government to close the mine but find solutions to sustain operations beyond 90 days.

The Minister is leading a delegation which includes Minister of Mines and Minerals Development Richard Musukwa, Minister of Labour Joyce Simukoko, Minister of Energy Mathew Nkhuwa, and Copperbelt Minister Japhen Mwakalombe.

Speaking when he met Mine Unions and Mopani Copper Mines officials, Dr. Ng’andu said President Edgar Lungu has sent the team to discuss how best operations can continue running while being mindful of the challenges the mining firm is going through.

He is hopeful that discussions will center around continuing operations beyond 90 days as applied for by Mopani Copper Mines Plc to place the mine on care and maintenance.

Meanwhile, Mr. Musukwa said the government wants Mopani to structure a surviving model and engage local contractors as opposed to foreigners with a top cost profile.

Mr. Musukwa said engaging local contractors will help Mopani to deal with some of its challenges adding that the government remains open to dialogue to find a win-win situation.

And Mineworkers Union of Zambia President Joseph Chewe said Unions will not allow Glencore to close the mine and should they decide to do so they should be asked to leave.

Mopani Copper Mines Plc Acting Chief Executive Officer Charles Sakanya said the mine is faced with challenges among them VAT refunds.

The delegation is on the Copperbelt to find solutions to the challenges at Mopani Copper Mines Plc, Chambishi Metals, NFCA, Copperbelt Energy Corporation CEC, and Lubambe.

Source: https://www.lusakatimes.com/2020/05/18/283199/

METOREX Limited a company running Chibuluma Copper Mines has informed government of its intentions to place its operations on care and maintenance.

Mines Minister Richard Musukwa confirmed this in Kitwe, but said Government would not allow the mine to send people on the streets.

He said the reasons given by Metorex had nothing to do with the Covid-19 but with its depleted resources.

“Yes Metorex has informed government. But the reasons for placing the mine on care and maintenance have nothing to do with covid-19, but something to do with depleted resources. As government we have opened discussions with Metorex to avoid sending people on the streets,” said Musukwa.

And over 400 miners at Lubambe Copper Mines in Chililabombwe have lost their jobs after the mine terminated the contract of Redpath.

But Musukwa asked Lubambe Copper Mines to put the interest of the workers first before its dispute with Redpath.

“Lubambe as a parent company should protect the interest of the workers while they have a dispute with Redpath. In this critical time mining companies are reducing the cost profile not workers. We don’t want the mines to use workers as the sweeping rock under these critical times. Lubambe, Metorex and Mopani should protect the workers,” he said.

Musukwa said the decision by Mopani to place its Kitwe and Mufulira mines on care and maintenance was an illegality.

He added that the 90 days notice given by Mopani Copper Mines is not meant to stop operations.

“We have noted that the mine had intended to put its mines on care and maintenance. But government takes great exception to such moves. We need to sit down and dialogue and provide a sustainable way of doing (things) during this critical time and ensure that the workers on the Copperbelt and North Western that their jobs are guaranteed and protected and ensure that Mines are sustained.”

“So the Ministers of Finance, Mines and Labour will be on the Copperbelt to ensure that this is done well. We also welcome Zambians that will come on board with information that will help the sector navigate during this time are welcome to provide information. What we want as government is to be inclusive and allow a broad spectrum of Zambians to be involved as we structure forward during this critical time,” said Musukwa.

“One key element is to ensure that Mopani reduce its operating cost. We would like to speak survival modes and it is to use local contractors who are at low cost. The 90 days notice is not meant to stop operations. It is meant to ensure that a survival mode is structured, that is in the spirit of the law.”

Source: https://diggers.news/business/2020/05/18/chibuluma-to-go-on-care-and-maintenance/

Minister of Finance Bwalya Ng’andu says government has restarted negotiations with Mopani Copper Mines Plc to find a solution that will avoid the mine being placed under care and maintenance.

Dr Ng’andu says it is not the desire of government to close the mine but find solutions to sustain operations beyond 90 days.

The Minister is leading a delegation who include Minister of Mines and Minerals Development Richard Musukwa, Minister of Labour Joyce Simukoko, Minister of Energy Mathew Nkhuwa and Copperbelt Minister Japhen Mwakalombe.

Speaking when he met mine unions and Mopani Copper Mines officials, Dr Ng’andu said President Edgar Lungu has sent the team to discuss how best operations can continue running while being mindful of the challenges the mining firm is going through.

He is hopeful that discussions will center around continuing operations beyond 90 days as applied for by Mopani Copper Mines Plc to place the mine on care and maintenance.

Meanwhile, Mr. Musukwa said government wants Mopani to structure a surviving model and engage local contractors as opposed to foreigners with a top cost profile.

Mr. Musukwa said engaging local contractors will help Mopani to deal with some of its challenges adding that government remains open to dialogue to find a win-win situation.

And Mineworkers Union of Zambia President Joseph Chewe said Unions will not allow Glencore to close the mine and should they decide to do so they should be asked to leave.

Mopani Copper Mines Plc Acting Chief Executive Officer Charles Sakanya said the mine is faced with challenges among them VAT refunds.

The delegation is on the Copperbelt to find solutions to the challenges at Mopani Copper Mines Plc, Chambishi Metals, NFCA, Copperbelt Energy Corporation CEC, and Lubambe Mine.

Source: https://www.znbc.co.zm/news/govt-restarts-mopani-negotiations/

The end of the bitter war over the future of the Bulk Supply Agreement which expired last month, Zesco and Copperbelt Energy Corporation have commenced the process of arbitration with the hope of settling their deep-rooted differences.

At the end of March, Zesco proceeded to terminate its Bulk Supply Agreement with CEC over a tariff dispute, effectively ending a 20-year business relationship.

But in a notice to Shareholders, CEC says arbitration matter with Zesco is in process and remains under adjudication.

“Shareholders are referred to the cautionary announcement, dated 27th September 2019, issued by the Board of Directors of CEC informing the market that CEC was in receipt of a notice of intention to arbitrate from Zesco Limited, pursuant to the Bulk Supply Agreement and Article 3 of the UNCITRAL Arbitration Rules 1976, resulting from ZESCO’s claim that CEC has failed to pay money due to them for electricity supplied under the BSA,” the notice read.

” The amounts outstanding relate to the supply of power by CEC to Konkola Copper Mines Plc. Zesco’s other cited ground is its disagreement with a statement in CEC’s 2018 annual report relating to the contingent liability arising from the 2014 Energy Regulation Board electricity tariff increase specific to the mining companies, which the mining customers have legally contested and were granted a Court injunction, pending the determination of the matter by the High Court for Zambia.”

 Source: https://www.lusakatimes.com/2020/05/13/cec-zesco-opt-for-arbitration/

MOPANI Copper Mines (MCM) has started recalling workers it sent on forced leave following its decision to resume operations early this week.
Last month, the mine suspended operations in Kitwe and Mufulira and sent workers on forced leave. It also terminated contracts with some companies it gets services from.
Glencore, the majority shareholders in MCM, did not give Government sufficient notice about its intention to place the Kitwe and Mufulira operations under care and maintenance, in accordance with provisions of the Mines and Minerals Development Act.
MCM’s decision also sparked protests among various stakeholders in the mining sector, who urged Government to revoke the mine’s licence. 

Source: https://www.daily-mail.co.zm/mopani-miners-trickle-back-to-work/

Works at the manganese mine in Serenje have commenced following the end of the heavy rains that had hampered kick-starting operations, posing a challenge in accessing the mine site areas.

ZCCM Investments Holdings Plc (ZCCM-IH) through its wholly-owned subsidiary Kabundi Resources Limited (KRL) are on-site and have started Phase one of the project in the small-scale mining license, with an initial capital injection of K18.6M.

Phase two of the project which is scheduled to start before the onset of this year’s rainy season will be extended to other areas of the ZCCM-IH Large Scale Exploration area in Serenje.

ZCCM-IH Chief Executive Officer Mr. Mabvuto Chipata undertook a site visit end of April 2020, where he also inspected works at the Kampumbu Resettlement area earmarked for the relocation of nine (9) households from the Kabundi mine site.

The Resettlement Action Plan (RAP) approved by the Zambia Environmental Management Services (ZEMA) involves the construction of an additional one-by-two classroom block, a health center, nine-by-three bedroomed houses for the relocation of the project affected families, one house for a teacher, and another house for a medical staff.

These buildings will also be serviced and fully connected with piped water sourced from water boreholes to be drilled in the area.

Mr. Chipata was happy with the progress made both at the mining operation and the RAP sites.

He stated that the mine will be fully operational by July 2020, and looked forward to having it officially launched by August 2020.

ZCCM-IH will spend a total of K4.5M to fulfill the RAP obligations, which are scheduled to be handed over to the beneficiaries in June 2020.

The RAP project has so far employed over 20 locals. KRL will further employ over 150 youths at the mine site as production scales up upon relocation of the affected families.

KRL targets to mine about 60,000 tonnes of manganese by the end of the year during the ramp-up period of operations.

Production is targeted to reach 240,000 tonnes of manganese ore annually once commercial production is achieved.

The Company is a strategic investment aimed at diversifying the commodity mix of the ZCCM-IH’s portfolio which is largely comprised of copper producing assets.

Source: https://furtherafrica.com/2020/05/07/zccm-ih-starts-mining-manganese-in-serenje-zambia/, https://fizambia.com/?p=6770