Thursday, June 13, 2024

HH challenged to ensure that Zambia begins to run its own mines

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President Hakainde Hichilema of Zambia has been challenged to ensure that the country begins to run its own mines by a social anthropologist, Dr. James Musonda. According to Dr. Musonda, the idea that Zambians cannot run the mines is not supported by empirical evidence, and the country has enough lessons from the past that would allow for a smoother running of the mines.

According to Dr Musonda, the country has learned lessons from the past and has the potential to smoothly run its mines. Zambia privatized its mines when global copper demand was low, but the situation has changed with electric vehicles, making copper one of the most sought-after minerals with good market prices. Dr. Musonda suggests that President Hichilema can eliminate the challenge of political influence on the mining sector and operate assets profitably.

Dr. Musonda also recommends that Zambia recapitalize Mopani Copper Mines rather than returning it to foreign businesses who will continue to declare losses and externalize mining profits. Four big mines, Barrick Lumwana, FQM Kansanshi, Mopani, and KCM (Konkola Copper Mines), dominate Zambia’s copper production, accounting for about 80% of the annual copper production. The Zambian government has a minority stake in nearly all of them. The other mines are backed by respected international investors.

Zambia is a major copper producing country, with four big mines dominating its copper production. These mines, namely Barrick Lumwana, FQM Kansanshi, Mopani, and KCM (Konkola Copper Mines), account for around 80% of the country’s annual copper production. They are backed by a wide range of respected international investors, with the Zambian government, through its investment-holding company ZCCM-IH, holding a minority stake in nearly all of them.

Barrick Lumwana, the largest copper mine in Zambia, is wholly owned by the Canadian company Barrick Gold Corporation, the world’s largest gold mining company. It has been operating in Zambia since 2008 and is located in the North-Western Province of the country. Barrick Lumwana produces an average of 250,000 metric tonnes of copper per year and employs around 4,000 people.

The second-largest mine is FQM Kansanshi, which is majority-owned by First Quantum Minerals, a Canadian mining and exploration company. ZCCM-IH holds a 20.6% stake in the mine, which is located in Solwezi, the capital of the North-Western Province. Kansanshi produces an average of 230,000 metric tonnes of copper per year and employs around 13,000 people.

The third-largest mine is Konkola Copper Mines (KCM), which is at the time before the dispute was majority-owned by Vedanta Resources, an Indian diversified metals and mining group. ZCCM-IH holds a 20.6% stake in the mine, which is located in Chingola, a city in the Copperbelt Province. KCM produces an average of 200,000 metric tonnes of copper per year and employs around 14,000 people.

The fourth-largest mine is Mopani Copper Mines, which was majority-owned by Glencore, a Swiss-based commodity-trading and mining company. ZCCM-IH holds a 10% stake at the time in the mine, which is located in the Copperbelt Province. Mopani produces an average of 90,000 metric tonnes of copper per year and employs around 15,000 people. Mopani has since been sold to government which is busy looking for a foreign partner.

Apart from these four big mines, there are several smaller players in Zambia’s copper production, which also play an important role. The balance of Zambia’s copper production comes from a handful of smaller Copperbelt mines, which are important in their own right and enjoy the support of respected international mining investors from countries such as China, Brazil, and South Africa.

These smaller mines, and their major shareholders, include Lubambe Copper Mine, which is owned by African Rainbow Minerals of South Africa and Vale of Brazil; Chibuluma Mines, which is owned by Metorex of South Africa, owned by Jinchuan Group of China; NFC Africa Mining, owned by China Non-ferrous Metal Mining Group; CNMC Luanshya, owned by NFC Africa Mining; Chambishi Copper Smelting Company, owned by China Non-ferrous Metals Mining Group; Sino-Metals Leach Zambia, owned by China Non-ferrous Metals Mining Group; Sable Zinc Kabwe, owned by Glencore; Albidon, owned by Jinchuan Group Resources, of China; and Chambishi Metals, owned by Eurasian Natural Resources Corporation, headquartered in London.

8 COMMENTS

  1. ATI Mopani produces 200,000mt and KCM 90,000. Was this production for last year or when.

    Total combined CP production is less than 120,000mt sir.

    Besides, you have left out Kalumbila with a production of more than 220,000mt.

    Of the 800,000mt annual production, NWP accounts for 700,000mt without which Zambia would no longer be classified as a copper producer.

  2. There are a clique of us who are ex-expats from Zambia and are profound Zambophiles. We are prepared to return to Zed and give our all to make the mining industry viable again. We’re prepared to accept Kwacha-denominated salaries.
    I remember using waste engine oil to recover copper when there was a shortage of Xanthate (the main copper collector in Zambia at the time). This was the time when ZCCM had to give all of the forex earned to the national exchequer!
    Jito, if you’re reading this, please have a word with His Excellency.

  3. The writer can’t even get the facts right. Barrick lumwana only produces 120,000 Mt per annum and is not the biggest producer. That title belongs to FQM Kalumbila / Sentinel mine. You can’t even do a bit of research yet you post about some socialist guy wanting to run our own mines?? This is the problem in Zambia, we want to undertake complex ventures yet we can’t even get the basics right. Look at the state of KCM and Mopani which are being run by ZCCM-IH!

  4. The capitalists wont allow him. Firstly they will isolate the Zambian mine owners and then fix the LME prices to heavily favour the buyers then they will gang up and secretly sanction Zambian enterprises of any kind. Its their world. Thats why Kaunda tried CIPEC

  5. WE CANT RUN ZESCO
    Who knows what goes on at NAPSA & ZRA
    WE couldnt run the mines in the 60’s 70’s
    What has changed now
    Run them at you own peril, the rsults will be our childrens resposibilty

  6. DONT GET IT TWISTED MINING IS NOT ABOUT KCM AND MOPANI, WE ALL KNOW THERE’S NO ZAMBIAN WITH SUCH CAPITAL TO OPERATE SUCH LARGE SCALE MINING OPERATIONS. HOW DOES A PRESIDENT ENSURE THAT ZAMBIANS RUN MINES THE MINES HAVE BEEN THERE FOR THE TAKING IN THE LAST 50 YEARS? AND HWY IS IT PUT ON THIS PRESIDENT TO ENSURE ZAMBIANS RUN MINES, WHY WASN’T IT AN ISSUE BEFORE? ALL ARTISANL MINERS ARE ZAMBIANS, I WOULD ARGUE THERE ARE MORE MINES OWNED BY ZAMBIANS THAN FOREIGNERS.

  7. Running a mine does not start with employing drillers, plant mets, mine managers, artisans, etc. It starts with raising enough investment equity. This is where the problem starts for Zambians. Where do Zambians get that money from? From text books, we learn of various sources of capital for investing in the mines but where do Zambians get it from? Banks? Which bank?. If Zambians can do it, lets start by seeing them run small emerald mines successfully.

  8. I think that Zambians should put Zambia first, because there is no guarantee anyone else will! You can do it Zambia!

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