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Monday, June 27, 2022

First Quantum Minerals approves $1.25 billion mine expansion in Zambia

Economy First Quantum Minerals approves $1.25 billion mine expansion in Zambia

Reuters and Financial Times of London report that First Quantum Minerals said on Sunday that its board has approved plans for a $1.25 billion expansion of the company’s Kansanshi copper mine in Zambia, first floated in January 2020, a decision the miner said was prompted by “renewed confidence” in Zambia’s investment climate.

Since President Hakainde Hichilema’s election last August, Zambia has implemented business-friendly reforms including allowing mining companies to deduct mineral royalties from their income tax assessments.

First Quantum pointed to that reform in particular as key to unlocking approval for the Kansanshi expansion, saying it “realigned Zambia with international best practice.”

FQM also said it approved a further $100 million investment in its Enterprise nickel project in Zambia, which it expects to start producing in 2023, ramping up to annual production of 30,000 tonnes of nickel in concentrate.

FQM said the $1.35 billion package overall represents the largest investment in Zambia since its Sentinel project was approved in 2012.

FQM and the government have also reached an agreement on outstanding value-added tax repayments owed to it and an approach for repayments based on offsets against future mining taxes and royalties, the company said.

The announcement came just ahead of the Mining Indaba conference in Cape Town where Hichilema was set to speak today, aiming to draw new investment into the country’s mining sector.

Africa’s second-biggest copper producer, Zambia aims to increase production to 3 million tonnes of copper a year within the next decade. The country produced 800,696 tonnes of copper in 2021.

14 COMMENTS

  1. No that is what we talking about? Lets get going, this is a breath of fresh air. We need to unlock this giant investment which will ultimately create jobs for the masses and create wealth. Thumbs up.

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  2. Please give this to LVSAMBO and his team to read, I hope they will appreciate it. Anyone who doesn’t acknowledge this, mwana wa ndoshi !
    The iron of the matter is that such articles receive the least comments and reading. Majority of the bloggers are more engaged when its articles involving tribal, hate, lies, or conspiracy theories.
    This tells alot about us, who are supposed to be the cream of the educated Zambians.

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  3. @General Kanene, I totally agree, this beyond their comprehension level, they thrive on foolish things instead of embracing positive change. These is for the elite, those of us who want to see real change and a paradigm shift in the economic malaise that the PF let us in, Bravo.

  4. This mine starting so small by washing off the tailings used as feed stalk at Bwana Mkubwa in Ndola.
    Their ambition to build Perth in Lumwana has earned them a good name in Zambia. It is one of the most respected mines in Zambia.
    However, they are ardent opponents of the sliding mineral royalty tax ( 5.5 – 10%) and the export tax of raw minerals put at 10% duty. These taxes would have fattened the GRZ treasury.

  5. But let them pay taxes.Tax holiday should be abolished.Let them explain how money will be spent before clapping ba praise singers

  6. “Since President Hakainde Hichilema’s election last August, Zambia has implemented business-friendly reforms including allowing mining companies to deduct mineral royalties from their income tax assessments.”
    In other words, since HH’s presidency, Zambia is allowing foreign companies decide how much tax they can pay.
    I am getting angry, naleka. I am off to drink kachasu, I hope Gary finds me so I can drink more.
    Finshi fimbi?

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  7. This is good though the capital budget is smaller than outlook presented in the need for expansion in the mines but it looks well coordinated and Stratergic to create mineral industrials arround solwezi and copperbelt but it’s smaller when you analyse cross sectional and revenues forward looking We expect mines to ramp up real Investments and increase productivity to add to national treasuries Spoken well at Capetown but let’s see what comes from the engagements and who comes to see potential minning sites for various minerals resources and industrials

  8. @1 Bamwine
    Our resources are being looted ..this explains why all these morons are willing to spend big …do we even need IMF……look at how much resources we have …companies willing to spend trillions

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  9. Bambi kuwayayafye once they spend initiative capital outlay nishichapwa no reinvesting real from proceeds until recovery better another kcm Investor

  10. @5 Chiza Chirwa
    Imagine making it extremely difficult for locals to invest and do business whilst giving free money to foreign investors….I seriously don’t get it….and you see them living like kings in Zambia whilst locals are struggling

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  11. The PF liars think they can find anything in everything HH does. They do not even understand that mineral royalty is taxable but only allwable as an expense at year end. This is a balanced affair – you cant tax a company on both sales and Profits – can you ? PF …SHAAAA !

  12. It is a business decision not that they want to help Zambia. Remember copper price is so high and is likely to continue being high for the next 10 – 15 years or beyond because of Electrical Vehicles project worldwide. Countries across the world have given themselves a target to get lid of fuel propelled vehicles and so demand on copper. FQM want to maximize on that and get more profit and deplete our resources. In 30 years time we will not have any mineral reserves.

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