Zambia said a lack of capital halted production at a copper mine it seized from Indian billionaire Anil Agarwal’s Vedanta Resources Ltd., just as the metal surges toward a record.
The standstill at Konkola Deep, a high-grade underground pit that also contains cobalt, was triggered by a shortage of funds to develop new mining areas, said Barnaby Mulenga, permanent secretary in the Ministry of Mines. The lack of capital is also curbing output at other operations of Konkola Copper Mines Plc, which was placed under provisional liquidation in 2019 after the government alleged Vedanta lied about expansion plans and paid too little tax.
The production setbacks at KCM come as copper surged back above $10,000 a ton on Thursday, with the reopening of major industrial economies sparking a commodities rally. Africa’s No. 2 copper producer is reliant on exports of the metal, but production at Konkola Deep may only resume after the resolution of a legal arbitration with Vedanta opens the way for new investment, Mulenga said.
“This demand for copper will only get higher and the sooner these issues are resolved there is still an opportunity to exploit this resource,” Mulenga said. “This is a giant which is sleeping and we remain positive that it will be mined at some point.”
Mulenga said KCM’s current challenges result from Vedanta failing to complete underground works that would have allowed more ore to be extracted from Konkola Deep. The flagship mine in Zambia’s Copperbelt requires most of the $1.2 billion needed to turn KCM around, he said.
Vedanta, which has denied the government’s allegations, said it was “saddened” to hear about the production halt at Konkola Deep. The company said it had invested more than $1.7 billion in KCM and had planned to spend a further $1.5 billion to make the operations profitable.
Last month, employees of more than 30 contractors at KCM stopped work and staged protests over workers’ grievances.
The mounting problems at KCM highlight the political risks as President Edgar Lungu’s government seeks a greater share of mining revenues ahead of elections this year. While Zambia’s copper production rose to a record last year, that didn’t prevent the nation from defaulting on its external debt.
Zambia also plans to sell a majority stake in Mopani Copper Mines Plc after acquiring the operations from Glencore Plc, Mulenga said earlier this year. The government wants to raise about $300 million to expand output and pay off the $1.5 billion it owes the commodities giant.
Source: Bloomberg
Even the inoguration white dove refused to fly for lungu……….instead flooping to the ground……..
Stolen things don’t last….
Even the inogura.tion white dove refused to fly for lungu……….instead floo.ping to the ground……..
Sto.len things don’t last….
Abrupt decisions lead to these problems.We
Tend to get carried away by cadres who advise us to take such decisions.We have to
Look at long term consequences in the event
We wish to take over.We have not eaten the
Fruit ourselves not did we let others eat.
PF calculations for campaigns funds and funding of PF lead them to kick the indians of KCM out………
KCM is now a cash cow for the PF……..
After elections , they give KCM back to the indians……
Even the inogura.tion white do.ve re.fused to fl.y for lungu……….instead fl.oo.ping to the ground……..
Sto.len things don’t last….
What a total disaster is the corrupt PF government leaving behind, incredible. Absolute incompetence lead by the worst president the country has ever had.
And this news has to come from abroad, Bloomberg to be exact, one of the most reputable and trustworthy organisations around. Not a WORD in any of the state owned media sources like ZNBC, Daily Mail, Times of Zambia etc. And some PF minion will say that this was all planned by the government and there is nothing to worry about!
NO FORWARD VISION AT ALL ……… AND SOME ARE STILL THINKING THIS PF GOVERNMENT IS THE ANSWER
HOW SHAMEFUL …….. AND CAN ONLY BE BECAUSE OF SELF INTEREST … WHY ELSE ?????????????
When we tell you the Lazy Lungu is incompetent you think its a joke!!
We quality is lucking and quantity can’t fit in. People where thinking running mines is like singing campaign songs. You can’t send candres and thugs to start running the mines that’s the end result. With PF government there’s is always a prize tag to pay and God help us.
This is a sad development but our government was only responding to allegations stretching over years,”investors are making money and externalising millions in profit”.
When investors told the Zambians of the challenges they faced, the allegations inuedoes continued until the government acted to please them
We are now at the same place we were in 1991.We couldn’t run the mines at 1$million per day at we’re looking at foreign investors AGAIN.
Which direction will Zambia go? Which investors will agree to such repeated change in policies?
Soon as you see it in the mainstream media you will hear the government spokeswoman saying they will sue Bloomberg. Tikali mucibe
It might be a blessing actually since higher copper prices will make PF get hungry for even more debt.
Where are those brainwashed PF cadres, who a few months ago were hallucinating ati, Zambia has the capability to run it’s mines… How far did it go? Please Zambians God has done what he can do expose for us the poverty causing incompetencies of this PF outfit. They have nothing for Zambians but their obsession to get state power back so the can continue to plunder the country’s resources and escape possible jail, it is all their motivation.
This is evidence that much our country’s problems is down to appalling leadership …even if we discovered oil and diamonds under Lazy Lungu..people would starve.
why do you want to give them another 5 years?
I agree!
Zambia wake up iwe! Government should increase the shares in the mining sector so that these high prices can make a true impact on our country. ZCCM should be capitalised to take-up new mines and take over dormant ones. Copper prices are predicted to go even higher to meet demands for renewable and sustainable new ways of living. My fellow Zambians, let’s put our differences aside and take interest in our God given resources. No PF or UPND would ever deplete these resources in one seating so rather than fighting each other, let’s share the cake.
Shortsighted clowns. PF.
An absolute disgrace.
PF are indeed escalating failures at large.
This is the biggest lie ever told in 2021,I was doing night shift yesterday and everything was running smoothly at konkola, do not be exited about this lie,the miners are happy on how the govt has handled the kcm issue. Napela mukwai
We have an opportunity of a life time to benefit from these high prices, but alas the people in charge are so short sighted that they don’t see beyond their bellies. Mother Zambia, who has cursed you?
actually, this is coming from the shameless enemies of Zambia in collaboration with unpatriotic Zambia seeking state power.How can you term the hard working person with concrete examples of hard work in view of many people.What has been done was supposed to be done from 1964 by 1991.We have one Zambia only.Those advocating for confusion through missinformance have offshore accounts and businesses.They will flee the country quietly and leaving the so called they want to help in confused state. ONE ZAMBIA ONE NATION.
With such high copper prices we would have expected the exchange rate to appreciate to at least K7 to a dollar but alas this government still climbing towards K23 and beyond.
Zambians are very very rich at criticising but very very poor at doing it themselves. This problem affects everyone in the country (it is a national issue) because the resources belong to all of us. But simple minds think that the PF must be blamed. Some on this blog cannot even finance a pit latrine but are so quick to rubbish everything that The Govt of the day does.
this is also a lie. Bloemberg tell lies too because they use journalist who have been bought