The ‘Investing in African Mining Indaba’ has long been an event that brings together investors, political leaders, commodity traders, and companies across the mining value chain to network and, crucially, to identify investment opportunities during four busy days at Cape Town’s International Convention Centre. It is these opportunities – and the potential spotlight which Africa’s largest mining event provides – that convinces ministers and presidents to converge in the continent’s southern-most country each year.

This year, Zambia seized opportunity with both hands. Never before has the continent’s second largest copper producer brought such a senior delegation, led by the President, to the Indaba – and it massively paid off.

On 9 May 2022, just an hour into the event, the irresistible optimism of President Hakainde Hichilema’s keynote address was reverberating through the exhibition hall, and into investment houses and newsrooms around the world. By 11am, the globally significant mining event was abuzz with the mantra “Zambia is back.”

“The irresistible optimism of President Hakainde Hichilema’s keynote address reverberated through the exhibition hall.”

It was not an axiom proclaimed by President Hichilema himself, although his speech contained no shortage of inspiration. These were the words of Tristan Pascall, incoming Chief Executive Officer (CEO) of First Quantum Minerals (FQM), the international mining giant which first invested in Zambia 26 years ago as a junior miner. Mr Pascall’s first act as CEO was to take centre stage and announce a US$ 1.35 billion investment affirming “a commitment to investing in Zambia’s future.” 

US$1.25 billion of this game-changing sum, which is the largest financial commitment to Zambia in a decade, will be used to expand operations at Kansanshi mine and smelter in Solwezi – a long-awaited project collectively known as ‘S3’. An additional US$100 million will be allocated to starting up its Enterprise nickel project in Kalumbila, into which US$150 million has already been invested by FQM.

Since President Hichilema came to power in August 2021, his Administration has been hard at work behind the scenes engaging with stakeholders in the mining sector to restore investor confidence and reinvigorate its standing as a world class mining destination. “The [new] Government of Zambia has been clear on its intent to grow the economy and reform the investment climate of the country, and this effort has come to fruition today,” said Mr Pascall. President Hichelema’s announcement of a ‘new dawn’ for Zambia’s mining sector provides the platform necessary for stable, durable and responsible mining in Zambia, he added.

“I think FQM’s investment sends a very positive message to other existing (and potential) investors who are thinking of increasing their financial commitments in Zambia,” said Mr Peter Leon, partner and Africa Co-Chair at global law firm, Herbert Smith Freehills, who attended the event in Cape Town. “Everybody I spoke to at the Indaba was very positive about the country. President Hichilema made two really important points in his speech. One was zero tolerance for corruption, which is a very good message to investors. He also said, ‘Stop speaking about Africa’s potential; African leaders need to start getting things done.’ I don’t think I’ve heard a speech from an African head of state quite like that before.”

CEO of Gemfields Sean Gilbertson agreed, calling the President’s speech “superb.” Gemfields owns a 75% stake in Kagem, the world’s single-largest producing emerald mine, located south of Kitwe in Zambia’s Copperbelt Province. “I would say that this is the most upbeat and excited we’ve been about Zambia since we first arrived in 2008,” he said.

“President Hichilema clearly recognises that the time for change is here, and that there’s an urgent need to stop the history of corruption and get things done in a way that allows the true owners of the natural resources to start benefiting.”

“I would say that this is the most upbeat and excited we’ve been about Zambia since we first arrived in 2008.”

Chief Financial Officer (CFO) of Copperbelt Energy Corporation, Mr Mutale Mukuka, is excited about the opportunity to support Zambia’s growing mining sector, saying “the business environment has significantly improved, allowing for more investments in the country.”

“Copperbelt Energy Corporation is taking strides in the renewable energy space and, by partnering with the mines, we are also helping them to achieve their Net Zero emissions goals, by adding a more renewable, sustainable energy source to the production cycle.”

Mr Mukuka expects to see tangible positive effects from FQM’s investment very soon. “Firstly, once construction [on S3 and Enterprise] commences, there will immediately be a need for supporting services and infrastructure. This is the growth that comes with mining, and where we expect to see a lot of benefits. Mining has never been a stand-alone sector. Secondly, the investment is timely in that it allows Zambia to extract resources now while commodity prices are reasonably high. We know for sure that, based on commodity prices trends, we’ll have booms and recessions, so we need to maximise production now to get maximum benefit as a country.”

Ms Dolika Banda, board chair of state-owned ZCCM Investments Holdings, the successor company to Zambia Consolidated Copper Mines Limited, referred to a “buzz” that followed President Hichilema around the Cape Town International Convention Centre this week. “I think ‘Brand Zambia’ really exploded in a manner that has never before been seen at an Indaba,” she said. “First Quantum’s investment has galvanised people’s curiosity, making people ask, ‘How can we be part of this conversation?’ It’s driven home the message that Zambia is open for business.”

The buzz of optimism that President Hichilema left in his wake was no accident. Zambia’s new Administration has shown the world that it understands well – with the characteristic savvy of a leader who has achieved business success on his own steam – that investors need policy stability and predictability in as long-term an endeavour as mining. This week, Zambia used its moment in the limelight to make that abundantly clear to the world.

Image: President Hakainde Hichilema (right) pictured with Tristan Pascall, incoming Chief Executive Officer (CEO) of First Quantum Minerals (FQM) (left) at the 2022 Investing in African Mining Indaba.

Source: https://miningforzambia.com/zambia-back-voices-weeks-mining-indaba/

High global copper prices and rising demand are reigniting investment in exploration in Africa’s copper hotspots, with the Democratic Republic of the Congo (DRC) and Zambia attracting significant capital funding and producers looking for revival in places such as Uganda, where copper mining had collapsed.

A 3 May statement from Robert Friedland and Yufeng Sun, the co-chairs of the DRC’s Kamoa-Kakula complex, announced expansion that will make it the third-largest copper mining complex in the world.

“Humanity will likely require as much copper in the next 22 years alone as it did through this point in its history — [about] 700-million tonnes — just to maintain 3% gross domestic product growth,” said Friedland, who is also Ivanhoe Mines’ co-chairperson.

The expansion of Kamoa-Kakula entered a third phase this month that will see it increase its annual copper production to 600 000 tonnes by the fourth quarter of 2024, according to the statement.

The Kamoa-Kakula copper project is a joint venture between Ivanhoe Mines, China’s Zijin Mining Group, the DRC government and Crystal River Global, which is meant to create shareholder value and long-lasting economic and social benefits for the country, thanks to investment in mining operations and beneficiation of the metal before it’s exported.

As part of the mega expansion project, two new underground mines — Kamoa 1 and Kamoa 2 — and the initial decline development at Kakula West will be developed, according to Ivanhoe Mines.

Adjacent to the two new mines at Kamoa, a five-million-tonne-a-year concentrator plant will be established, taking total processing capacity to more than 14-million tonnes a year. Power for the expansion will be hydroelectric, through a partnership with the DRC’s Inga II hydro project, the Kamoa-Kakula statement said.

In Zambia, UK-based mining company Moxico Resources plans to expand its majority-owned Mimbula copper mine, with a $100-million investment.

Moxico started low-cost production in April 2020 at the Mimbula Copper Project on the outskirts of Chingola town.

Zambia’s copper output fell to 800 696 tonnes in 2021 from 837  996 tonnes in 2020 but President Hakainde Hichilema has committed to creating a conducive investment climate for miners and mining exploration. He announced in April that Zambia’s government was close to finding a private investor for its Mopani Copper Mines, one of the country’s biggest. Zambia has been looking for a buyer after taking on $1.5-billion debt to buy Mopani from Glencore in January 2021.

Also in April, Uganda began the official hunt for an investor to revive copper and cobalt production at its defunct Kilembe mine.

“With increase in demand for copper and cobalt worldwide, the government of Uganda, through the privatisation unit, wishes to implement the development of Kilembe mines,” the country’s ministry of finance, planning and economic development said in an expression of interest document.

Kilembe is Uganda’s largest copper mine, with estimated deposits of copper in excess of four-million tonnes. The mine began operations in 1952 and was closed in 1982 when exploration ceased because of depressed world copper prices.

Winning bidders must also process Kilembe’s copper output for domestic use. The government wants local copper used in the manufacture of electrical wires, transformers and coils to bolster its manufacturing industry, as well as for export.

All these developments are geared towards tapping into the current global demand for copper with higher returns.

In March, Fitch Ratings raised its copper price assumptions from $8 500 to $9 500 a tonne in 2022 and to $8 500 in 2023, citing increased post-pandemic demand, tight markets and short-term supply disruptions, particularly as a result of Russia’s invasion of Ukraine.

“Copper is the only commodity where we increased our long-term assumptions due to its use in electrification,” said Fitch Ratings in its latest Global Metals and Mining Price Assumptions. Beyond 2025, Fitch pegs copper prices at $7 000, a rise from an earlier projection of $6 700.

“Some commodities also benefit from increased longer-term demand due to their role in global decarbonisation,” said Fitch.

Audit firm EY said the average copper price of $6 726 a tonne over the past decade has been lower than the usual “incentive price”, which ranges between $7 000 and $8 000 a tonne for new project developments.

EY also has sentiments affirming the industry’s competitiveness in the longer term, driven by electric vehicle adoption, renewable power generation and green infrastructure.Global copper reserves grew at a compounded annual growth rate of 3.3%, in line with 3.7% annual compounded growth in exploration budgets, according to EY. — Bird Story Agency.

Source: https://mg.co.za/africa/2022-05-13-higher-prices-demand-revs-up-copper-mining-in-africa/

One of the copper industry’s most influential players has called the moment an “inflection point” for the metal, as Africa sees a surge of investment and renewed interest in copper mining and processing.

High global copper prices and rising demand are reigniting investment in exploration in Africa’s copper hotspots, with the DRC and Zambia both attracting significant capital funding and lesser-known producers like Uganda, where copper mining had collapsed, looking to a revival.

In a 3 May statement from the co-chairs of the DRC’s Kamoa-Kakula complex, Robert Friendland and Yufeng Sun, announcing further expansion that will make it the third-largest copper mining complex in the world, Friedland said that copper had reached an “inflection point”.

“We are at an inflection point for the copper industry . . . one where we must determine how to meet growing demand, even as discovering and building new mines becomes ever more challenging,” said Friedland, who is also Ivanhoe Mines co-chairperson.

“Humanity will likely require as much copper in the next 22 years alone as it did through this point in its history – [about] 700-million tonnes – just to maintain three per cent gross domestic product growth,” said Friedland.

According to the statement, the expansion of Kamoa-Kakula has entered a third phase this month that will see it increase its annual copper production to 600,000 tonnes by the fourth quarter of 2024.

Kamoa-Kakula copper project is a joint venture between Ivanhoe Mines, China’s Zijin Mining Group, the DRC government and Crystal River Global that is meant to create both shareholder value and long-lasting economic and social benefits for the country, thanks to investment into both the mining operations and beneficiation of the metal before it is exported.

As part of the mega expansion project, two new underground mines – known as Kamoa 1 and Kamoa 2 – and the initial decline development at Kakula West will be developed, according to Ivanhoe Mines. Adjacent to the two new mines at Kamoa, a new, five-million-tonne-a-year concentrator plant will be established, taking total processing capacity to more than 14-million tonnes a year. Power for the expansion will be hydroelectric, through a partnership with the DRC’s Inga II hydro project, the Kamoa-Kakula statement said.

In Zambia, Africa’s second-largest copper producer after the DRC, UK-based mining company Moxico Resources plans to expand its majority-owned Mimbula copper mine, with a $100m investment.

Moxico started low-cost production in April 2020 at the Mimbula Copper Project, a copper-rich oxide and sulphide deposit located in the Zambian Copperbelt on the outskirts of Chingola town.

Zambia’s copper output fell to 800,696 tonnes in 2021 from 837,996 tonnes in 2020 but its new president Hakainde Hichilema has committed to creating a far more inducive investment climate for miners and mining exploration.

Hichilema, who took over in August 2021, won widespread support in Zambia’s “copperbelt” region, due to his supportive stance towards the industry.

Hichilema announced in April that Zambia’s government was close to finding a private investor for its Mopani Copper Mines, one of the country’s biggest. Zambia has been looking for a buyer after taking on $1.5bn in debt to buy Mopani from Glencore in January 2021.

Also in April, Uganda began the official hunt for an investor to revive copper and cobalt production at its defunct Kilembe mine.

“With the increase in demand for copper and cobalt worldwide, the government of Uganda through the privatisation unit wishes to implement the development of Kilembe mines,” the country’s Ministry of Finance, Planning and Economic Development said in an Expression of Interest document.

Kilembe is Uganda’s largest copper mine, with estimated deposits of copper in excess of four million tonnes. The mine began operations in 1952 and was closed in 1982 when exploration ceased due to depressed world copper prices.

“Thereafter, the company operated on a care and maintenance basis in anticipation that mining will resume at a future date when global prices are more favourable,” the ministry said.

Uganda expects winning bidders to also process Kilembe’s copper output for domestic use. The government wants local copper to be used in the manufacture of electrical wires, transformers and coils to bolster its manufacturing industry, as well as for export. These developments are geared toward tapping into the current global demand for copper with higher returns.

In March, Fitch Ratings raised its copper price assumptions from $8,500 to $9,500 per tonne in 2022 and to $8,500 in 2023, citing increased post-pandemic demand, tight markets and short-term supply disruptions, particularly due to the Russia-Ukraine conflict.

“Copper is the only commodity where we increased our long-term assumptions due to its use in electrification,” said Fitch Ratings in its latest Global Metals and Mining Price Assumptions.

Beyond 2025, Fitch pegs copper prices at 7,000 US dollars – a rise from an earlier projection of $6,700. “Some commodities also benefit from increased longer-term demand due to their role in global decarbonisation,” said Fitch.

According to audit firm Ernst and Young (EY), the average copper price of $6,726 per tonne over the last decade has been lower than the usual “incentive price” which ranges between $7,000 and $8,000 per tonne for new project developments.

EY also shares similar sentiments affirming the industry’s competitiveness in the longer term, driven by electric vehicle adoption, renewable power generation and green infrastructure.

“The strong demand outlook and recent price uptrend provide miners opportunities for aggressive exploration,” said EY. According to the firm, global copper reserves grew at a compounded annual growth rate of 3.3%, in line with 3.7% annual compounded growth in exploration budgets.

Source: https://www.theafricareport.com/202949/africa-renewed-interest-in-copper-mining/

ZAMBIA’S President Hakainde Hichilema blasted fresh air through the Africa Mining Indaba yesterday when he delivered the speech that Mineral Resource and Energy Minister Mantashe should have given only moments before.

This was according to Peter Leon, a partner and Africa chair of international law firm Herbert Smith Freehlls, following Mantashe’s address at the opening of the first Energy Indaba to be held in two years.

”Like Mantashe, President Hichilema told delegates that Zambia was open for business. However, unlike Mantashe, the president elevated the private sector as an absolutely key partner for the successful development of Zambia’s mining sector. He reiterated his government’s commitment to a transparent, predictable and fair investment climate with absolutely no tolerance for corruption,” said Leon.

South Africa’s mining sector was recently ranked as one of the 10 worst mining investment countries in the world, according to the 2021 Fraser Institute Investment Attractiveness Index. South Africa fell to 75th place out of 84 countries (down from 40 in 2019) and was ranked 12th out of 15 countries in Africa.

Zambia’s Hichilema announced a “new dawn” that will aim to push copper production to 3 million tons per year from around 800 000 tons last year, that there would be no “mining nationalism” and that the moratorium on the granting of new mining licences would be lifted soon.

He said the country’s economy was anchored in copper mining, and “endemic corruption” was being cleansed of mining licensing processes prior to the opening up of the industry to new investors in the country.

In addressing some of the challenges to the sector on the continent, he said Zimbabwe, South Africa, Zambia and Republic of Congo needed to find some “common ground” to fix the rail system between these countries, so that we “can move our goods and products”.

First Quantum Minerals followed Hichilema’s speech with the announcement of a $1.3 billion (R21.1bn) investment to “double down”” on the group’s copper production in Zambia and also to establish a nickel mine there.

Anglo American CEO Duncan Wanblad said the mining industry was critical to the transition to a low carbon future, in that additional quantities of minerals such as copper which is used in every electric vehicle, solar panels and wind turbines, would need to be mined to meet the demand from the transition.

“The world cannot decarbonise without the products of mining. Mining is the enabler of the energy transition,” he said, adding that the energy transition would also create entirely new economic sectors and jobs that went along with them.

“The energy transition presents a fresh opportunity to build a clean energy system that can create opportunities. Policy support, regulatory certainty and robust state institutions are important,” as was the rule of law and the rooting out of corruption, he said.

Wanblad said that Anglo American had reached a partnership with French energy and renewables group EDF to develop a regional renewable energy system in South Africa that would be capable of generating between 3 and 5 gigawatt, through on-site solar plants and wind turbines, which would amount to Anglo American’s total electricity consumption in the country.

He said the group was accelerating its efforts on decarbonisation and aimed to reach a target of being a net zero carbon emitter by 2050.

Mantashe said the Africa Continent Free Trade Area could cut red tape and boost trade on the continent, significantly improving mining supply chains and reducing input costs.

“The Just Transition to a low-carbon future will require ‘green metals’ to which Africa has in abundance of untapped resources such as lithium, copper, cobalt, nickel, and zinc.Invest in mining in Africa, it is the continent of the future,” he told the international delegates and some 30 government ministers at the conference.

Leon said there was no word from Mantashe on South Africa’s progress in fixing its dysfunctional licensing system or to resolve long-standing issues around the Mining Charter, which remain mired in litigation and controversy.

Mantashe did acknowledge the Fraser Institute’s latest results, disputing the accuracy of the latest assessment. He said at a later briefing, however, the Fraser report needed to be read “holistically” and in fact also indicated an improvement in perceptions about the regulatory and policy environment in South Africa.

Also, Mantashe announced a commitment to a 60-day turnaround from his department for self-generation licences for renewable energy, notwithstanding his acknowledgement that these approvals were being held back by the slow approvals from other departments.

Responding to a question about the slow process of approval of mining projects by his department, he said it was a “slow process,” often complicated by “three applications on one farm”, and he said the department was making slow progress on improving its cadastral system.

Source: https://www.iol.co.za/business-report/companies/zambia-and-sa-wooing-investors-at-2022-mining-indaba-52875a5a-02aa-451b-b7ac-7894e51a9e21

ZAMBIA’S exports of refined copper in the first quarter increased to 464,800 metric tonnes from 463,700 metric tonnes in the same period last year. Copper is the country’s major foreign exchange earner and is currently trading at US$9,759 a tonne on the London Metal Exchange (LME). Zambia Statistics Agency (ZamStats) interim statistician general Mulenga Musepa said export earnings from refined copper in March increased by 3.8 percent to K13.9 billion from K13.4 billion in February this year.

“The cumulative volume of refined copper exported for March was 230,500 metric tonnes while that of 2021 for the same period was 228,000 metric tonnes, representing a 1.1 percent increase,” Mr Musepa said on Wednesday during a media briefing. He said copper prices on LME market for the corresponding months increased by 3.4 percent to US$10,237.6 a tonne in March from US$9,941.4 a tonne in February. Mr Musepa also said Zambia’s major export products in March were from the intermediate goods category mainly comprising copper anodes and electro-refined copper cathodes (high purity) accounting for 90.9 percent. During the period under review, Mr Musepa said the major export destination was Switzerland, which accounted for 41.7 percent. The main export product to Switzerland was copper anodes for electrolytic refining accounting for 75.5 percent of total export earnings. Mr Musepa said China was

Read more: http://www.daily-mail.co.zm/refined-copper-exports-soar/