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KCM remits over K700 million to Government in taxes

Despite the various problems afflicting Konkola Copper Mines in recent months in addition to a commercial standoff with Copperbelt Energy Corporation over US$44 million in energy services, the miner has upheld its tax obligations and remitted over K700 million in taxes to Zambia Revenue Authority two years ago.

Deputy mines minister Richard Musukwa told lawmakers in Lusaka, Sept. 30 that KCM remitted a total of K782,269,066.72 in taxes to the Zambia Revenue Authority (ZRA) and that the company was not selling copper to Vedanta Resources but was selling at the international market on the London Stock Exchange.

Responding to oral questions from who wanted to know the total number of workers employed by Vedanta Resources Plc, whether KCM sold copper to Vedanta Resources, how much copper was sold in 2012 and how much money was paid by KCM in form of taxes to the ZRA in 2012 Musukwa stated that the company had a total number of 7,553 workers as of August 29, 2014.

The lawmakers further sought clarifications as to whether the miner had been audited in view of reports that the company had been undeclaring its earnings in Zambia. Recently, its chairman Anil Agarwal was reported to have mocked Zambians over a US$500 million profit the mine earns in Zambia annually after investing a paltry US$25 million in 2004.

However, Musukwa stated that the Government was working to ensure it cleared suspicions that Kim was under declaring its taxes so that the Zambians get the best in terms of taxation.

Recently, KCM spokesperson Shapi Shachinda lamented that the company was among the highest paying in electricity tariffs in Zambia under the Bulk Power Supply Agreement with Copperbelt energy Corporation, the distributor of power to the mines, which is claiming US$44 million debt from the miner.

In a statement recently Shachinda stated that KCM was facing power restrictions following a commercial dispute between the two parties. KCM now pays more than K700 million (rebased currency) per year in power tariffs.

The dispute follows CEC’s unilateral increase in power tariffs since April 2014 contrary to the provisions of the Power Supply Agreement (PSA) between KCM and CEC. The CEC has also been refusing to generate invoices based on electricity tariffs agreed through the PSA to facilitate payments of bills by KCM for power supplied to the mine, Shachinda added.

It should be noted that prior to April 2014, CEC had increased power tariffs by over 100% in accordance with the PSA and this has resulted in KCM having the highest power tariffs in the mining industry in Zambia.

The restriction in power supply will adversely affect Konkola Copper Mines’ operations and compromise safety of the employees and job security. The operations of the Nchanga integrated business unit have already grossly been affected.

KCM regrets that CEC has chosen not to pursue this matter in accordance with the PSA provisions on dispute resolution.

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KCM grapples to remain operational in Zambia

Operational problems at Konkola Copper Mine (KCM) have heightened because of a myriad of problems besieging the country’s leading producer of copper and cobalt.

Until Friday, Sept.26, KCM had power restricted to a number of operations including the concentrator at the Tailings Leach plant and the underground section which later was flooded with water, following a US$44 million debt accrued in unpaid energy bills to power supplier on the Copperbelt – the Copperbelt Energy Corporation (CEC).

Despite the unpaid bills, CEC decided to restore 100 percent power to KCM premised on the understanding that the company would meet its obligation as directed earlier by the Lusaka High Court that the company pay the US$44 million which had been outstanding since April this year.

CEC spokeswoman, Chama Kalima said the restoration of full power supply to KCM was done out of goodwill despite KCM failing to meet its financial obligations adding that is not right for any business that means well to wait for court orders for it to pay for services consumed.

“It is our hope that in response to this show of good faith, KCM will pay all its outstanding bills and begin to pay all their future bills as they fall due,” she said.

CEC believes it is important that all parties take learning points from this incident and begin to uphold obligations in accordance with the Power Supply Agreement (PSA), she added in a statement following interventions by the Ministries of Mines to have the matter harmonized to avoid ‘sabotage’ to the economy.
“Irrespective of this decision, CEC still reserves all its rights per provision of the PSA with KCM, which CEC will exercise should it become imperative to do so in the near future,” Kalima added.

The refusal by KCM to pay against invoices issued for about six months, even on undisputed amounts, has adversely affected CEC’s business and subjected the power company to subsidizing and sustaining KCM operations for the said period.

As a consequence, CEC has also been unable to fully discharge its obligations to ZESCO Limited.

Despite their continuous defaulting on payments, KCM also argues that they are not liable to pay interest, in complete contravention of the PSA.

“All this is unacceptable in normal business practice and should not be encouraged,” Kalima stated.

KCM spokesperson Shapi Shachinda has since confirmed the restoration of power to affected areas of the mines but lamented that the discharge of water from underground would take some weeks to be undertaken.

This is in the wake of the company losing US$3.3 million in revenue as well as 482 tons of copper in interrupted production of the red metal over the past few days.

on the operations of the mines by the management and seeks that the miner should revive its operations by injecting fresh capital into the company, these sentiments were brought to light by Vice President and leader of Government business in Parliament, Guy Scott.

Responding to lawmakers, Scott said it was his view that fresh capital be pumped into the mining company.

The lawmakers wanted to know the future of the mining company in view of reports in the media to which Vice President replied; “Our Government’s view is that KCM needs a fresh capital injection. Our experts, consultants and advisors say there is a requirement to put in more money if KCM is to be more viable.

”When Government suggested to KCM to recapitalise the mine, the other shareholders, Vedanta, responded by saying Government itself through ZCCM Investment Holding must put in money, Scott added.

Vedanta had also further suggested that they be allowed to borrow money from the local banks.

Dr Scott said the idea of borrowing money locally would not be okay as other sectors such as agriculture would be affected, he told lawmakers during question and answer sessions on Sept. 26.

Meanwhile, Minister of Mines, Energy and Water Development Christopher Yaluma earlier on Sept. 25 cited poor management of Konkola Copper Mines (KCM) as the major reason the mining firm has failed to pay the Copperbelt Energy Corporation (CEC) US$44 million in electricity bills.

KCM is currently going through serious financial challenges and that Government is closely monitoring the situation at the company to ensure it does not result in job losses.

He told lawmakers that is sad that the giant mining firm will not be able to meet the set production levels in the next quarter due to the power supply which has been restricted to 90 percent by CEC instead of the required 100 percent.

“Mr Speaker, although KCM is capable of running the mine, it will not manage to meet the production levels we have set in the next quarter due to the power restriction.

“But what I have to state is that KCM is going through serious financial challenges due to poor management of the mine and this has also resulted in the company failing to pay the money it owes CEC in electricity bills,” the Minister said.

Earlier, KCM, through its parent company Vedanta Resources mocked Zambians over its U$500 million profit being made annually in the Southern African country since it invested a paltry US$25 million in 2004.

And President Michael Sata had earlier warned the company against undertaking its planned mechanization of the mining company in which over 1,579 workers were to be laid off to replace them with machinery.

President Sata had also warned Vedanta to follow the country’s policy of seeking to create employment than facilitate “redundancies” to the nationals.

However, Shachinda in a statement has reaffirmed KCM’s commitment to remain in Zambia and contribute to the country’s growing economy and that there were no plans to leave the country in spite of the current problems being faced.

Vedanta Resources have since 2004 invested close to US$4 billion in operations and corporate social responsibility programs.

Source: Mining News Zambia
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Enviro company limits dust at Zambia copper mine

Environmental management company I-Cat Environmental Solutions is supplying Zambian copper mine Kansanshi, owned and operated by mining companies First Quantum Minerals and ZCCM-IH, with its GreenGrip gravel road sealant.

The sealant eliminates dust on the mine’s semipermanent roads, preventing the adverse effects of dust on miners and reducing maintenance costs caused by dust-related failures, explains I-Cat Zambia director Chris Smit.

He notes that GreenGrip, which is an environment-friendly polymer-based product, was first applied at the mine in June 2013.

“Normally, mines use water to get rid of dust, but by applying GreenGrip, you prolong the effect, as GreenGrip has a special ingredient mixed with the polymer that binds soil and seals the road.

Dust is a huge problem on Zambian mines, particularly at this time of year, owing to the dry and windy conditions

– Chris Smit

“Instead of water bowser trucks constantly spraying water, GreenGrip needs to be applied only once every two to three days, depending on the dust levels at the mine. This significantly reduces maintenance and associated costs,” Smit tells Mining Weekly.

He notes that, while Zambia currently has air-quality laws in place, Zambian mines do not often adhere to them. This, however, is starting to change, says Smit, as international companies, which need to adhere to a country’s laws to remain operational, are becoming more prevalent in Zambia’s mining industry.

Smit highlights that dust is a huge problem on Zambian mines, particularly at this time of year, owing to the dry and windy conditions.

“Many people work in plant and pit areas, and on haulage roads, which are very dusty. Dust affects their health and, by applying these products, mines can reduce the dust levels by 40% to 50%, making a significant difference to the health of mine personnel,” he emphasises.

Smit adds that temporary roads, particularly around pit areas, that are not treated with GreenGrip are, however, treated with RDC 20, which is a more cost-effective dust palliative product offered by I-Cat.

Supplying Zambian Mines
He notes that I-Cat has been supplying the Zambian market since 2011 with its liquid soil additive RDC 20, which binds fine soil into heavier particles to prevent dust from becoming airborne. I-Cat has also introduced its new bitumen-based GreenBit product, which can primarily be used on main haulage roads to prevent roads from being washed away by rain.

“Owing to heavy rainfall in Zambia, GreenBit was developed in 2013 for application on main haulage roads and is currently being used on ferrous metals miner Assmang’s Bruce and King mines, in the Northern Cape, South Africa, with huge success. We apply this product to roads in Zambia to stabilise the roads during rainy seasons,” he explains.

GreenBit, as the name suggests, has an additive mixed with a lower dose of bitumen, which reduces the environmentally harmful impact of the more traditional bitumen-based products.

“We are an environment-friendly company and, as such, we strive to supply products to mines that have the same effects as a bitumen road – commonly known as asphalt – but with lower toxicity levels.

“Our mission is to prevent environ- mentally harmful products from spilling into runoff streams and dams, which is why we developed green products such as GreenGrip and RDC 20.

I-Cat Zambia has been registered with the Zambian Environmental Management Agency (Zema) since 2012 and all its products have been tested and declared environment-friendly by Zema.

Source: Mining Weekly
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First Quantum, Metorex mining increase Copper production, turnover in Zambia

Two of some of the leading multinational mining companies operating in Zambia, Africa’s leading copper producer, have found a niche for their investment and have this year increased mineral production and also increased their earnings.

First Quantum Minerals Limited, the Australian listed and diversified miner, with operations in Zambia at Kansanshi and the new ‘Greenfield’ US$2 billion Kalumbila Mine in north western province increased its copper production by four percent during the last three months to 30 June this year to 107,808 tons compared to 103.694 tons three months prior.

Copper sales per ton rose over 10 percent to US$114,449 against US$95,491 during three months ending 30 June this year at Kansanshi mine in Zambia as the cash cost of copper production per pound also increased to US$1.45 against an earlier US$1.34 three months earlier.

Nickel production in contained tons dropped to 10,651 against 11,927 three months earlier, although realized copper prices/per pound rose to US$12,223 against US$10,875 recorded three months prior to 30 June, the company said.

Gold sales rose US$60,135 against US$59,381 during the three months to 30 June this year while gold production dropped 60,723 ounces against 63,567 ounces three months prior to the period under review, it said in its report.

Sales revenues increased to US$945.1 million against US$869.3 million during the three months ending 30 June with gross profit rising to US$293 million against US$201.1 million.

Expected group production has been revised to be between 418,000 and 444,000 tons of copper, 45,000 and 48,000 tons for nickel, 221,000 tons and 242,000 tons for gold between 55,000 and 60,000 tons for Zinc respectively.

It has revised its capital expenditure for the group at US$2.4 billion from an initial US$2.2 billion, excluding capitalization of any pre-commercial production and capitalized interest.

Metorex Minerals Ltd. achieved a turnover of US$60.4 million at its owners Chibuluma Mine in Zambia during the six months ending 30 June this year as profit before tax re declined to US$14,490 at the end of the six months ending 30 June this year from US$15,888 recorded a year earlier.

Despite recording an increased production of the red metal to five percent, turnover for the company during its operations over six months remained flat chiefly on account of reduction in average copper price.

At 30 June, this year, Metorex Ltd’s Chibuluma mine spent US$3.8 million on development of its ‘Greenfield’ Chifupu copper project on the outskirts and south of Kalulushi on the Copperbelt, intended to extend the mine lifespan to the year 2020 from the estimated 2017.

To boost mine operations and increase copper outturn Metorex Mining, the owners of the Chibuluma mine have approved about US$24 million to be spent on the development phase of the Chifupu project and ensure it is done as scheduled, says Eustus Munsaka, Metorex’s Chief Financial Officer in his report.

During the period the company paid US$5.882 million to shareholders in interim dividends.

First Quantum Minerals and Metorex are among the multinational miners that emerged into Zambia after the privatization of the mining conglomerate-Zambia Consolidated Copper Mines (ZCCM) in the late 1990s as Zambia sought to promote private sector ownership of the mines in the copper-rich country.

Since the privatization of the mines, an investment of US$8 billion has been ploughed into the mines with copper production projected to rise to 1.5 million tons by next year and later rise to over 5 million tons by 2022, according to projections by the chamber of mines of Zambia, basing on the oncoming projects at various mining companies in the country.

Source: Mining News Zambia
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Mopani Copper Mines injects US$15 million in artisanal training scheme

Mopani Copper Mines, a unit of global commodity trader and diversified miner, Glencore Xstratra, has injected more than US$15 million in reviving an artisan training school in Mufulira, one of its operational areas following calls by the Government to improve skills training in the country and reduce on the industry relying on expatriates.

Previously, Zambian mines under the then Roan Consolidated Copper Mines (RCM) and Nchanga Consolidated Copper Mines (NCCM)-which together formed Zambia Consolidated Copper Mines (ZCCM), various mining companies had established training skills centres in various towns.

This was meant to encourage Zambians to learn various trades as part of the country’s effort to reduce on labour outsourcing, which saw many Zambians learn the ‘various trades’ and rose to senior ranks.

Among some of the Zambians that rose to senior positions at the time of ZCCM included then Superintendent, Albano Mutati, Pius Mambo and Francis Kaunda, among others as part of the Zambianisation of jobs by then President Kenneth Kaunda ostensibly to encourage the locals to run the mines.

However, with the continued outcry from Government on the need for the industry to maximize on locals to take up senior jobs and reduce on outsourcing, which has seen various Zambians fail to rise to senior positions, Mopani Copper Mines has taken a step ahead in meeting the desires of the Government.

In a statement by the miner, US$15 million (about K90 million) has been ploughed into constructing (reviving) a central training centre in Mufulira, which the company then under RCM had before the unbundling of the ZCCM conglomerate, to mitigate the critical shortage of artisan skills across Zambia’s mining industry.
Mopani Copper Mines chief executive officer, Danny Callow, says the continued growth of the copper mining industry in Zambia has led to a shortage of key technical skills and unavailability of suitably qualified and experienced local artisans. This situation necessitated the establishment of the training centre.

Callow stated that the training centre had been equipped with the world’s best engineering equipment and had so far enrolled over 140 students in its first intake. A total of 200 apprentices would be enrolled by the end of 2014.

Additionally, the Technical, Education, Vocation and Engineering Training Authority (TEVETA) accredited Centre, has come in handy and is offering courses under Mechanical Engineering that include, Fitting and Machining, Plating and welding, Heavy Mining Equipment Diesel Mechanics and Rigger Rope man. In Electrical Engineering, the school will offer courses in Electrical, Auto Electrical and Instrumentation.

The course being offered to the miners, Callow, added would last between two and three years. This was similarly the trend before under ZCCM, in which many Zambians learnt various trades ranging from fitting, electrical, boiler makers, metal fabricators and welders, among others.

It is envisaged, according to the syllabus being offered that the first class of fully trained artisans is expected to graduate in 2016 in which training will be accessible to Zambian school leavers and other local candidates seeking qualifications leading to a career within the mining industry.

According to Callow, the miner would spend a minimum of approximately US$20,000 annually on each apprentice in standard training and other related costs. Other than offering the training for free, Mopani would also provide the students with upkeep allowances, meals and accommodation and recreation facilities.

More than 30 years ago since Zambia’s mining industry became active, leading the country into becoming Africa’s leading copper producer-a feat it has maintained for the past 26 years, Zambia had well-established and funded training institutes that produced highly-qualified artisans and technicians for the mining industry.

Regrettably, the slowdown in copper prices on the international metal market in the 1970s which saw Zambia contribute a paltry 250,000 tons per annum from an average 700,000 tons earlier led to reduced investment in mining and training infrastructure.

Zambia was eventually forced to abandon artisanal training programmes on account that most undergraduates opted to pursue engineering courses at university level, Callow notes in his statement adding that the few remaining artisans could not satisfy the growing industry demand which led to the increased cost of hiring artisans.

During a recent workshop in Kitwe, northern Zambia, Chamber of Mines of Zambia President Emmanuel Mutati, an engineer himself, lamented the low skilled manpower-especially at Artisanal levels a situation he said needed to be reviewed to prop up the industry.

He attributed the decline to the development of the mines in north western Zambia, which has taken most of the skilled laborers to start up new projects in the area, now dubbed “The new Copperbelt” because of its vast mineral resources including gold and uranium.

Source: Mining News Zambia
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Local contractor commends joint venture partnership initiative by Mopani

Mopani Copper Mines Plc has implemented a number of programmes aimed at empowering and building capacity of local contractors and other small and medium enterprises in Zambia. The Company is encouraging formation of joint venture partnerships between local contractors and internationally-recognized and well-established foreign firms wishing to do business with the mining company. This has cheered the local contractors who have commended Mopani for coming up with the initiative.

One such joint venture supported by Mopani is between Shawonga Enterprises Limited of Zambia (33.3%) and ZINPRO Engineering of South Africa (66.7%). The two have partnered to form ZINPRO Zambia Limited, a company specialized in Shaft and structural steel rehabilitation works. ZINPRO Zambia has been engaged by Mopani to undertake massive refurbishment of the shaft infrastructure which Mopani inherited in a highly dilapidated state at privitisation.

Mopani Chief Executive Officer explains the company’s policy on joint ventures and the benefits that will be derived from supporting these partnerships:

“We have a deliberate policy that encourages foreign manufacturing companies wishing to do business with us to partner with local companies or involve Zambians in their shareholding structures. This, we believe, will help to build capacity of local companies, encourage skills transfer and give a competitive edge to the local firms whilst improving quality and efficiency,” said Mr. Callow.

Mr. Callow said initially attention was directed at improving processing plants and that time had come to address mining related issues.

“At privitisation we inherited highly dilapidated infrastructure both on surface and underground. Our major focus initially was to upgrade the Smelter to eliminate SO2 emissions and improve its efficiency. This project was completed 15 months ahead of schedule in March 2014 and is currently doing very well.

“Our focus now is to improve efficiency and productivity of underground operations. Maintenance of vertical shaft infrastructure is a highly specialised job and there is lack of local skills in this regard due to many years of lack of investment. Every month Mopani loses about 6000 metric tons of copper due to shaft shutdowns to facilitate maintenance.

“By bringing in shaft experts, ZINPRO Zambia Limited, Mopani will address the problem of frequent shutdowns and achieve continued production and less maintenance costs. This will also make shaft maintenance skills available in Zambia through the exchange that will take place as a result of the partnership,” Said Mr. Callow.

ZINPRO Zambia Operations Director, MrLondon Mwafulilwa has hailed Mopani for coming up with the initiative of supporting joint ventures. He has reiterated that the move will benefit all stakeholders involved, including the nation.

“First and foremost this venture is important to our Company because we are able to realize the full potential of the skills that are available, blend them with those of experienced hands and be able to participate in improving productivity in the mining industry as well as grow the mining support base. We are also able to provide employment and develop the local skills of the Zambian personnel,” said Mr Mwafulilwa.

He also reiterated that by partnering with ZINPRO Engineering, the local company has been able to upgrade its profile and working culture and expects a lot of future benefits.

“The ZINPRO Team has brought on board experience and an adorable working culture which most of our technical people do not have. The approach to how we look at the entire business has changed because we now drive solutions as compared to merely seeking contract opportunities.

“In the long term, there will be appropriate technology transfer and in the next 5/10 years we should have in the country dependable and reliable teams to be able to manage such projects without external expertise.”

Mr Mwafulilwa appealed to other local contractors to be consistent and prove their worth as opposed to seeking quick rewards. He further commended Mopani for the initiative.

“It is important for local contractors to remain focused and concentrate on their core business. This is the only way the mining industry will benefit from their input as they become specialists in their fields.

“Shawonga Enterprises Limited has been consistent for over 22 years of operation and therefore gained the necessary recognition from the players in the industry to a point where we are now able to contribute positively to the growth of the industry.

“I would like to commend Mopani for supporting such ventures as they create sustainable growth and support for the mining industry which can then be passed on from generation to generation. This is good not only for the mining industry, but the country as a whole especially that such specialised skills are getting fewer and fewer globally.

In order to promote efficiency in mining, Mopani is promoting other joint ventures between International world class contractors and solid, dependable local Zambian Contractors to form a Zambian owned, world-class mining contracting company by introducing expert skills and resources. This should lead to improved effectiveness and efficiency. The Company is further encouraging value addition and local procurement by empowering local manufacturers of various mining inputs such as cables, mill balls among other things.

Other local contractor development initiatives by Mopani include giving preference to local contractors before a tender can be extended to foreign contractors, Conducting capacity building workshops and trainings in addition to creating new business linkages for local contractors by assisting them to do business with other sister mines across the borders.

“Formation of joint venture partnerships, where Zambian companies take an equity stake, and add significant Zambian expertise to the newly formed company, create a win-win situation for all stakeholders. Empowering local contractors is a great step forward in developing the mining industry in Zambia in line with Government’s local content strategy,” Said Mr. Callow.

Source: Mining News Zambia
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Metorex Chibuluma Mines to spend US$26 million for explorations, official

Metorex Mining Limited, the South African based mid-tier mining group plans to spend over US$26 million to undertake exploration activities at its Chibuluma mine in Zambia over the next two years, says a mine official.

General Manager Jack Sikamo said while the company already spent US$12.7 million in strategic capital expenditure from 2010 to 2013, more resources have been earmarked in capital expenditure for 2014 and 2015.

In a paper presented during a workshop in Lusaka for various stakeholders recently, Sikamo stated that the company is also looking for acquisitions, explorations and joint venture partnerships with local or foreign companies to expand its operations in the country.

However, the miner is facing key challenges in the operations of the mining companies, among others, falls of ground, copper price reduction and increasing cost of production.

Government legislation without engagement, current resources mined out by 2020, skills retention, underground collisions, men/machines, safety, supervisor safety culture, historically supervisor- dependent and equipment availability and reliability are other challenges facing Metorex Mining Limited, a company established in 1995.

Chibuluma mine, formerly under Zambia Consolidated Copper Mines (ZCCM) and which produced 18,000 metric tonnes of copper last year, is expected to ramp up production to 19,000 metric tons of the red metal this year.

Metorex, a fully, owned subsidiary of Jinchuan International, was created with a vision to expand and explore activities in African base metal industry, based primarily on copper and cobalt production.

The company employing over 3,700 employees, generated group gross revenue US$408 million on copper sales of 45,000 metric tons and 3,000 metric tons of cobalt in 2012. It seeks to increase its outturn despite the challenges faced.

Chibuluma Mines plc is a modern mechanized underground copper mine owned 85 percent by Jinchuan Group Company Limited and 15 percent by ZCCM-IH plc.

The planned extensive exploration work is expected to extend its mine life by several years and significantly increase its minable reserves of both cobalt and copper.

Metorex Mining Limited, the South African based mid-tier mining group plans to spend over US$26 million to undertake exploration activities at its Chibuluma mine in Zambia over the next two years, says a mine official.

General Manager Jack Sikamo said while the company already spent US$12.7 million in strategic capital expenditure from 2010 to 2013, more resources have been earmarked in capital expenditure for 2014 and 2015.

In a paper presented during a workshop in Lusaka for various stakeholders recently, Sikamo stated that the company is also looking for acquisitions, explorations and joint venture partnerships with local or foreign companies to expand its operations in the country.

However, the miner is facing key challenges in the operations of the mining companies, among others, falls of ground, copper price reduction and increasing cost of production.

Government legislation without engagement, current resources mined out by 2020, skills retention, underground collisions, men/machines, safety, supervisor safety culture, historically supervisor- dependent and equipment availability and reliability are other challenges facing Metorex Mining Limited, a company established in 1995.

Chibuluma mine, formerly under Zambia Consolidated Copper Mines (ZCCM) and which produced 18,000 metric tonnes of copper last year, is expected to ramp up production to 19,000 metric tons of the red metal this year.

Metorex, a fully, owned subsidiary of Jinchuan International, was created with a vision to expand and explore activities in African base metal industry, based primarily on copper and cobalt production.

The company employing over 3,700 employees, generated group gross revenue US$408 million on copper sales of 45,000 metric tons and 3,000 metric tons of cobalt in 2012. It seeks to increase its outturn despite the challenges faced.

Chibuluma Mines plc is a modern mechanized underground copper mine 85 percent owned by Jinchuan Group Company Limited and 15 percent by ZCCM-IH plc.

The planned extensive exploration work is expected to extend its mine life by several years and significantly increase its minable reserves of both cobalt and copper.

Source: Mining News Zambia

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CEC sues KCM over US$30 million power debt

Copperbelt Energy Corporation, Zambia’s supplier of electricity to mining companies on the Copperbelt has dragged Konkola Copper Mines to court over a US$30 million debt it is owed based on an internal agreement, the Post reported.

Citing an affidavit filed before the Lusaka High Court, CEC wants KCM, a unit of London Listed Vedanta Resources Plc, to pay it US$30,923,091.92 being the amount due and owed to it for the supply of electricity power.

The power company also seeks the High Court’s indulgence to order KCM to pay the above amount with interest as well as costs arising from the court matter.

Lusaka High Court

The electricity power supply transaction, the paper adds, was done pursuant to the Power Supply Agreement made between the two parties on 31 March 2000, as amended. CEC had agreed to supply electricity and KCM also agreed to purchase all its electricity power requirements, the Post reported citing a claim accompanying the writ of summons.

In April this year, KCM obtained a restraining order for CEC not to restrict power supply to the mine by applying to the court.

Konkola Copper Mines Plc (KCM) is a major integrated copper producer in Zambia, primarily engaged in the exploration for mining, production and sale of copper. It is rated as one of the world’s wettest mines, yielding approximately 350,000 cubic metres of water per day from underground.

It is currently engaged in developing the more than IS$1 billion Konkola Deep Mine Project, in which it is expected to increase copper production to over 400,000 tons per annum when completed.

Source: Mining News Zambia 
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KCM relocates 402 Chingola squatters

Vedanta Resources Plc, owners Konkola Copper Mines, a Zambian unit, has asked over 400 squatters living on a mine land and has disbursed K588, 000 to those farming in the same area earmarked for mine expansion.

The 402 residents who have encroached in Chabanyama area in Chingola, one of its mining areas, have set up settlements on the mine land which the miner has set up as a dumping site in its continued expansion programme.

Company spokesperson, Shapi Shachinda, concerned with the encroachments, urged residents around mining areas to avoid conducting any activity on mining land as this is against mining regulations. The mining company has since intensified patrols to ensure that no fresh encroachment occurs, the spokesperson said in a statement to the Mining news Zambia.

And the company has provided K588, 000 in compensation to squatters in Chabanyama who are carrying out farming activities as a support to the residents whose farming activities have been affected by the company’s decision to relocate them from the mining land which is now a dump site company’.

Zambia Consolidated Copper Mines Investment Holdings (ZCCM IH owns 20.6 percent of KCM and the other 79.4 percent is owned by Vedanta Resources. KCM is one of Zambia’s major integrated copper producing companies. It is primarily engaged in the exploration for, mining, production and sale of copper and copper by-products.

KCM aims to be a world class Copper Mining and Metals company and has therefore adopted a growth and efficiency strategy. Since 2008, over $2.5bn has been invested to upgrade equipment, build new facilities and expand capacity. These investments have increased reserves & resources and increased the life of the mines.

KCM currently produces 2 million tons of copper ore per year. The company’s US$1 billion Konkola Deep Mining Project (KMDP) will expand its capacity to 6 million tons of ore per year when completed by 2016.

Source: Mining News Zambia
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Maamba mine’s 330 megawatt thermal power plant almost ready

The US$800 million thermal powered power plant under construction at Maamba Collieries is an advanced stage with Government hopeful that its commissioning and subsequent operation will ease power outages being experienced in Zambia, one of Africa’s top copper producers.

Zambia’s power generation, at an average 1400 megawatt which increases to 1800 during peak periods daily, has failed to meet the consumer demand in the country and for export markets as espoused by the Southern African Power Pool (SAPP), which promotes energy sharing among the 15 SADC member states.

The construction of the 300 megawatt thermal power is expected to reduce the inadequate power capacity generation by Zambia when connected to the national grid in collaboration with the state utility-Zambia Electricity Supply Corporation, or Zesco. The plant is planned for takeoff by 2016.

Commerce, trade and Industry deputy minister who is also Sinazongwe constituency lawmaker, where it is located, Richwell Siamunene, says, the thermal power plant, when completed, will ease power outages experienced in the Southern Province and Maamba area.

The connection to the grid will also benefit the entire country in which low energy capacity has stifled its envisaged economic growth rate averaged between 8-10% per annum as demand for power grows.

Xing Zhonghua the Site Manager for SEPCO Engineering, the company carrying out construction works says 60 per cent of the works on the project has been done.

And the Government is still looking for an equitable partner to take up Ndabwe Mine formerly Collum Coal Mine to resume operations at the 12000 tons per annum producer to resume operations after it was shut down by Government for various safety and environmental reasons when it was running under a Chinese company.

Owners of Maamba collieries and Singapore-based Nava Bharat Pvt, earlier projected to double coal output at Maamba mine by 2011 after modernizing the facility it acquired in 2010 for US$26 million.

The company acquired a 65% stake in Maamba, a key supplier of the heating substance to many of the copper mines and various private sector-driven companies in Zambia. A total 35% of the shares were retained by the state-run ZCCM-IH.

Earlier plans by the new owners were to build a new $12 million coal processing plant by the end of 2010. Maamba mine has 78 million tons of known coal reserves expected to last over 70 years.

The mine, produced 600,000 tones coal during peak production in the 1980s and had aimed to reach a maximum output capacity of 2 million tones of coal per year in the long term.

It was envisaged that the Maamba colliery at its peak capacity could reach 1 million tonnes of marketable coal and about the same tonnage of power grade coal to feed the power plant. The power project was estimated to cost $630 million of which 70 % was expected to be financed through debt and the remaining 30 % from equity by shareholders.

There are plans by the Government to eventually list 25 % of the shares in Maamba Collieries on the local bourse with a larger share of that coming from the government’s stake once the firm established a track record of profitability.

Source: Mining News Zambia