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Monday, 27 May 2013

Mining Watch (KCM, FQM and Berkeley)

Three important recent stories on the mining from for KCM, Berkeley and FQM:

Vedanta Resources Plc’s Zambian unit plans to cut 24 percent of its workforce after costs rose and the copper price dropped. Konkola Copper Mines Plc will reduce the total number of employees at its operations in Africa’s biggest producer of the metal by 2,000 from 8,263, the Chingola, Zambia-based company said in an e-mailed statement.

Copper for three-month delivery has slumped 8.3 percent to $7,273 a metric ton over the past 12 months in London trading. KCM says labor and electricity, its two key costs, have been “increasing constantly and substantially. It says “KCM needs to make business changes to remain economically viable..Regrettably, this means reducing staff numbers as many of the upgrade and expansion projects come to an end.”. 

I have previously discussed the Zambia's vulnerability to the slow down in China here and here

On a more positive note, First Quantum Minerals (FQM) has revealed that it has so far employed around 2000 Zambians at its Sentinel Mine at Kalumbila, 120 kilometres west of Solwezi. A further 400 Zambians are expected to be hired when the construction of a smelter in Solwezi starts soon. Sentinel Mine is the first of the three mines at the largest mineral project ever undertaken in Zambia known as 'Trident'. FQM is expected to boost its copper production to 700,000 tonnes per annum by 2015 with the completion of Sentinel Mine and increased output from expansion of Kansanshi Mine.

Separately, Berkeley Minerals Resources Plc (BMR) plans to reopen the Kabwe lead and zinc mine, which was closed in 1996. BMR also owns Bwana Mkubwa Copper Mines and several other mineral assets in Zambia. It appears the environmental issues have been sorted out with GRZ. The mining operations in Kabwe are expected to start before the end of 2013. BMR plans to employ "former ZCCM Kabwe mine workers".

Copyright © Zambian Economist 2013

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