Zambia hints at increasing mining stakes, as Mine Minister, Kabuswe, assures investors


Mines and Mineral Development Minister, Paul Kabuswe, says government is keen to negotiate larger holdings in new mining projects.

Kabuswe told Reuters at the ongoing Mining Indaba on Wednesday that this would be done in order to raise its revenue and boost spending by investors on social projects.

He said this would be done through ZCCM-IH to future agreements, but would not include existing mines hence should not worry investors.

Zambia is said to be Africa’s second-largest copper producer after neighbouring Democratic Republic of Congo.

ZCCM-IH is believed to have interests of 10 percent to 20 percent in mines including those owned by Barrick Gold, Vedanta Resources and First Quantum Minerals.

ZCCM sold a 51 percent stake in Mopani Copper Mines to a unit of United Arab Emirates’ International Holding Company, retaining the remainder, which previously belonged to Glencore.

“Stakes in new tenements will actually be moulded around such kinds of partnerships,” Kabuswe said in an interview on Tuesday on the sidelines of the Africa Mining Indaba.

“We want to make sure that there is win-win, that there is no slave-master relationship and we also want to make sure that there’s social impact,” he added.

While Zambia’s government had set a copper production target of about three-million metric tonnes within a decade, output has been declining gradually due to challenges at some operations including Mopani and Konkola Copper Mines.

“We are going to be very strong in negotiations,” Kabuswe said. “But not too strong to the extent of scaring away potential investors.

“Lusaka also planned to start buying minerals such as copper from projects it had stakes in to trade on its own,” he said.

Read More: Mopani Copper Mine set to receive $1.1 billion investment from International Resources Holdings

While the details of establishing a trading house are still to be worked out, a special purpose vehicle had been approved by the Zambian cabinet, Kabuswe said.

The government is also closely following developments on First Quantum’s Panama mine and hopes the challenges the Canadian miner is facing are resolved.

He added that First Quantum had not informed the government of any plans to sell or bring in a strategic investor.

“We are looking closely,” Kabuswe said. “But looking closely not in a negative sense, but hoping that things around them can be resolved so that it doesn’t affect ourselves.”

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