Investee Companies

Investee Company News, ZCCM-IH News

KCM still owes ZCCM-IH over US$59m – report

KONKOLA Copper Mines still owes ZCCM-IH over US$59 million under a Settlement Agreement that was signed in February 2013, according to the latest Auditor General’s report. The Auditor General’s Report on Accounts of Parastatal Bodies and other Statutory Institutions for the 2013 financial year stated that the mining company did not honour a Settlement Agreement signed between the two entities and has an outstanding balance due to ZCCM-IH amounting to US$59,684,655. According to the report, a Settlement Agreement had been signed on February 11, 2013, as a full and final settlement of all claims due under or pursuant to the Price Participation Agreement, which KCM had failed to honour previously.

“KCM Plc agreed to pay ZCCM-IH amounts totalling US $119,744,655 over a period of four years in line with the payment schedule as follows: US$46,324,655 to be paid on or before August 31, 2013; US$73,420,000 to be paid on or before September 30, 2016 in accordance with the payment schedule,” read part of the report. “However, as of September 2014, KCM Plc had not honoured the Settlement Agreement and had only paid a total amount of US$16,500,000 out of US$76,184,655, which was due as of September 30, 2014, leaving a balance of US $59,684,655.” The report stated that although KCM failed to honour the Settlement Agreement, ZCCM-IH, on the other hand, also failed to trigger an enforcement clause stipulated in the Agreement. “The agreement stipulated that in case KCM failed to pay a deferred amount at the next instalment date, ZCCM-IH was permitted to take legal action for monies owed through the English courts or by arbitration in respect of the deferred amount and any interest that would have accrued pursuant to clause 5. Contrary to clause 5 of the Agreement, as of November 2014, there was no evidence to show that ZCCM-IH had taken any legal action for monies owed,” it stated.

The report also revealed that ZCCM-IH has had “poor performing loans” with Ndola Lime Company Ltd, with the latter having failed to pay the former over US$7 million in an instalment due last June. “On 29 July, 2011, ZCCM-IH signed a loan agreement with Ndola Lime Limited an amount of US $26,000,000. A review of the agreement repayment schedule and accounting records revealed that Ndola Lime Limited should have repaid a total of US$7,356,990 as at June 30, 2014. However, Ndola Lime Limited had not made any payments to ZCCM-IH as of August 2014 and ZCCM-IH had not enforced the default clause of the contract,” stated the report.
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Murray & Roberts makes progress on synclinorium shaft sinking project

Murray & Roberts Cementation Zambia has reported the completion of the sinking of the Synclinorium Shaft project in Kitwe, Zambia for its client Mopani Copper Mines (MCM).

“The last blast of the Main shaft took place on 30 September 2014 with the shaft at a final depth of 1 280.85 m below the shaft collar,” Murray & Roberts Cementation Zambia Project Manager Neil Mackay, says.

The scope of work comprised a blind sink of a 7m diameter downcast lined shaft with a bulk air cooler level, two electrical cubbies and two stations. The equipping and commissioning of the shaft commenced at the end of October with the erection of a new headgear, winder and roping up the shaft scheduled for 2015.

The Murray & Roberts Synclinorium shaft team has worked closely with the Mopani Copper Mine Synclinorium Project team towards the common goal of helping the project reach the safe stage where it is today.

Noteworthy achievements at the Synclinorium Shaft project to date include a record 96 m of sinking and lining achieved for the month of August 2013 and a Lost Time Injury Free figure of 290 days to date.

A challenge to date has been the pumping of up to 24 000 litres of ground water daily from the shaft. This groundwater is pumped to the surface from where it is diverted into a settlement pond for treatment.

“We intersected a 28 m dyke, from 1 040 m from 1 068 m, and sank through it without incident, a notable achievement given that the rock is very hard and susceptible to scaling. This has necessitated support to within 1 m of the shaft bottom in order to increase worker safety,” Senior Project Manager Wyllie Pearson, says.

Equipment deployed on the project by Murray & Roberts Cementation Zambia includes stage and kibble winders, a five boom jumbo shaft drill rig, a five deck working stage with a cactus grab, two mini excavators and an automated batch plant.

All equipment is serviced in a comprehensive on site workshop by a well trained team to ensure operational excellence and adherence to strengent safety measures.

The current date for commissioning of the shaft is December 2015.

Murray & Roberts Cementation Zambia has also pioneered several health and safety innovations at the Syclinorium Shaft project. These include a new system to replace the old system of hand signals and pull bells to communicate from the shaft bottom to the working stage platform.

The new system consists of a radio installed in a worker’s hardhat, with a built in speaker and microphone to enable hands free operation. The shaft bottom signalling system allows the sinker at the shaft bottom to give the kibble winding engine driver signals from a hand held unit.

Electronic alcohol testing equipment has also been deployed to measure the blood alcohol levels of all workers entering and leaving the site. The system is linked to the entrance turnstile and will not allow a worker to enter if he is in violation of the zero parameter.

Another innovation has been the introduction of directional rope lights on the stage to indicate to all workers which direction the kibble is at any given time.

While the Synclinorium Shaft represents Murray & Roberts Cementation Zambia’s first project for MCM, subsequent similar projects managed from its Kitwe office have underlined the contractor’s excellent track record in the country.

The team is 1 084 strong, comprising accountants, human resources coordinators, training facilitators and raise bore, mining and engineering teams.

Of these 141 are expatriate workers, ranging from management to shaft sinking specialists. A full project management, shaft sinking, raise boring and development portfolio offering is provided by Murray & Roberts Cementation Zambia, in addition to training and technical support.

Source: Mining News Zambia

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Murray & Roberts cementation continues to excel at Lubambe copper mine LTD

Murray & Roberts Cementation’s second contract, for the trackless high speed development at Lubambe Copper Mine in Zambia, has been extended by a further two-year period.

The Lubambe Copper Mine which is a joint venture between African Rainbow Minerals, VALE and Zambia Consolidated Copper Mines Investment Holdings, is expected to produce 45 000 tonnes of contained copper at steady state by 2015.

The current contract involves all horizontal development work using trackless high speed technology in Ramps 1, 2, 3, 4 and 5.

In addition, the Murray & Roberts Cementation team was also requested to undertake the vertical development of return airways, service raises and silos and maintenance work on the surface infrastructure, provided by Murray & Roberts Cementation on the first phase of the contract, will continue for the duration of the entire contract.

Murray & Roberts Cementation Senior Project Manager at Lubambe Wyllie Pearson, added that they will continue with several projects that were started under the first contract.

“We will continue the development of infrastructure for two conveyor belt systems and supply and install all temporary compressors and air piping reticulation necessary for the development works and diamond drilling section. Furthermore, we will install all temporary ventilation fans and ducting,” he said.

“We also operate and maintain the owner’s equipment fleet. Six Sandvik TH 540 dump trucks, four Sandvik LH 410 and one Sandvik LH 514 LHD, as well as nine Sandvik TH540 40-ton articulated dump trucks allocated to load and haul. Face charging is performed with three Getman emulsion charging units and the transport and lifting equipment consists of two Getman scissor lifts, a Fermel scissor lift and two Getman cassette handlers. A Fermel grader and Manitou 742 telehandler complete this fleet,” added Pearson.

Allocated to drilling are five Sandvik DS320 double boom split-feed jumbos, a DS320 fixed rail jumbo and a DS 420 long hole rig used for raise mining. The support and supervision vehicles are Toyota Land Cruisers, which have been converted to mining specifications.

“All maintenance work on this equipment as well as the Murray & Roberts Cementation equipment fleet is undertaken in our well-equipped on-site workshop by a highly experienced team of mechanics and technicians, to ensure optimised operability and uptime. All consumables are supplied by the mine,” he revealed.

Pearson said that the contract is characterised by a high level of cooperation between the Murray & Roberts Cementation and Lubambe Copper Mine teams.

“We have developed a mutually beneficial relationship that sees us providing our client with a ready and continuous supply of power and water handling facilities, to ensure efficient interaction within overlapping areas. In addition, the mine provides our team with rock bolts, split sets, mesh and cement, while diesel and lubrication oils are supplied as free-issue items.”

Since the extension of the first contract by 15 months, a total of 24 653 metres has been developed against a target of 23 458 m.

“We have made excellent progress to date and met every one of our scheduled targets. The two main underground tipping arrangements consisting of four tipping points and two silos were completed and commissioned within the scheduled construction dates. A mineral sizer was installed and commissioned ahead of schedule on the tips,” Pearson said.

The six level crusher chamber was rehabilitated and supported with welded mesh and 6 m cable anchors, with the crusher and equipment in place. In order to assist with the main return air system, a series of ventilation raises were developed from the ramp 3 225 Level and two 225 kW surface fans installed and commissioned.

The project has not been without its challenges. Some parts of the Lubambe ore-body can only be accessed by mining through a very weak zone of sand-like material. The sand zone developing and support project comprises four successfully completed sections with a fifth in progress.

These sand zones require specialised support methods developed specifically for Lubambe and are similar to civil tunnelling support methods. Pearson explains that this has been effectively achieved by using Titan soil nails, Becker Arch Sets, 5,6 mm welded mesh and shotcrete as support mediums. Sand is excavated out of the face using a Hyundai 35Z7 mini excavator.

At the request of the client, a drop raising programme was undertaken, with 12 345 metres completed concurrently with contractual development.

Pearson expressed belief that the success of the project to date can be attributed to a number of factors, including the creation of a highly efficient team of experienced and multinational operators, supervisors and management, mostly with previous expatriate experience. The drilling team is a mixture of Australian decline mining specialists and Filipino and South African expats.

The team comprises 405 employees, with approximately 12% expatriates. The Zambian national component of the team is made up of HR staff, surveyors, accounts and administration staff, skilled operators, officials and workmen. The expat component of the crew consists of site management, safety and training staff and expert miners, operators and maintenance staff.

Similarly, training plays a big role in ensuring that the requisite regulations and quality standards are achieved and maintained.

“The training at Murray & Roberts Cementation’s Bentley Park facilities included trackless mining modules. The nature of the ore bodies in Zambia is such that most of the mining is fully trackless, with the exception of the haulage levels. There is a vast pool of fully trained and experienced mine workers available to recruit from, which has greatly simplified the human capital element of the project,” Pearson pointed out.

He said there was a successful transformation from a small highly skilled decline sinking crew, to a team responsible for ore and main development, sometimes in remote and scattered areas of the mine.

Employees also have access to a modern e-learning centre which has been opened at Murray & Roberts Cementation’s Synclinorium shaft sinking project in Kitwe

“This centre provides the same high quality standards as the Bentley Park facility in South Africa. The comprehensive Murray & Roberts electronic library and learning system is available for learners and facilitators alike,” quipped Pearson.

Appropriate and successful training is reflected in the safety record achieved on site, with no Lost Time Injuries (LTI) recorded for the first year. There have also been no fatal incidents on the contract to date, a noteworthy achievement given the nature of the project.

The award of the Synclinorium shaft sinking project, as well as the shaft sinking and development of the Mufulira Deeps project are a true reflection of the company’s reputation in the region.

In addition, Murray & Roberts Cementation’s Raise Boring Division is presently operating in Kansanshi, a further indication of the significant growth in the company’s presence in Zambia.

“Murray & Roberts Cementation has demonstrated complete commitment to its Zambian projects through the formation of a Zambian division with corporate offices situated in Kitwe. We are presently able to offer prospective clients a full shaft sinking and development portfolio, including training and administration from Zambia, with the benefit of technical and logistical support from Murray & Roberts Cementation in South Africa,” Pearson said.

Source: Mining News Zambia
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KCM remits over K700 million to Government in taxes

Despite the various problems afflicting Konkola Copper Mines in recent months in addition to a commercial standoff with Copperbelt Energy Corporation over US$44 million in energy services, the miner has upheld its tax obligations and remitted over K700 million in taxes to Zambia Revenue Authority two years ago.

Deputy mines minister Richard Musukwa told lawmakers in Lusaka, Sept. 30 that KCM remitted a total of K782,269,066.72 in taxes to the Zambia Revenue Authority (ZRA) and that the company was not selling copper to Vedanta Resources but was selling at the international market on the London Stock Exchange.

Responding to oral questions from who wanted to know the total number of workers employed by Vedanta Resources Plc, whether KCM sold copper to Vedanta Resources, how much copper was sold in 2012 and how much money was paid by KCM in form of taxes to the ZRA in 2012 Musukwa stated that the company had a total number of 7,553 workers as of August 29, 2014.

The lawmakers further sought clarifications as to whether the miner had been audited in view of reports that the company had been undeclaring its earnings in Zambia. Recently, its chairman Anil Agarwal was reported to have mocked Zambians over a US$500 million profit the mine earns in Zambia annually after investing a paltry US$25 million in 2004.

However, Musukwa stated that the Government was working to ensure it cleared suspicions that Kim was under declaring its taxes so that the Zambians get the best in terms of taxation.

Recently, KCM spokesperson Shapi Shachinda lamented that the company was among the highest paying in electricity tariffs in Zambia under the Bulk Power Supply Agreement with Copperbelt energy Corporation, the distributor of power to the mines, which is claiming US$44 million debt from the miner.

In a statement recently Shachinda stated that KCM was facing power restrictions following a commercial dispute between the two parties. KCM now pays more than K700 million (rebased currency) per year in power tariffs.

The dispute follows CEC’s unilateral increase in power tariffs since April 2014 contrary to the provisions of the Power Supply Agreement (PSA) between KCM and CEC. The CEC has also been refusing to generate invoices based on electricity tariffs agreed through the PSA to facilitate payments of bills by KCM for power supplied to the mine, Shachinda added.

It should be noted that prior to April 2014, CEC had increased power tariffs by over 100% in accordance with the PSA and this has resulted in KCM having the highest power tariffs in the mining industry in Zambia.

The restriction in power supply will adversely affect Konkola Copper Mines’ operations and compromise safety of the employees and job security. The operations of the Nchanga integrated business unit have already grossly been affected.

KCM regrets that CEC has chosen not to pursue this matter in accordance with the PSA provisions on dispute resolution.

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KCM grapples to remain operational in Zambia

Operational problems at Konkola Copper Mine (KCM) have heightened because of a myriad of problems besieging the country’s leading producer of copper and cobalt.

Until Friday, Sept.26, KCM had power restricted to a number of operations including the concentrator at the Tailings Leach plant and the underground section which later was flooded with water, following a US$44 million debt accrued in unpaid energy bills to power supplier on the Copperbelt – the Copperbelt Energy Corporation (CEC).

Despite the unpaid bills, CEC decided to restore 100 percent power to KCM premised on the understanding that the company would meet its obligation as directed earlier by the Lusaka High Court that the company pay the US$44 million which had been outstanding since April this year.

CEC spokeswoman, Chama Kalima said the restoration of full power supply to KCM was done out of goodwill despite KCM failing to meet its financial obligations adding that is not right for any business that means well to wait for court orders for it to pay for services consumed.

“It is our hope that in response to this show of good faith, KCM will pay all its outstanding bills and begin to pay all their future bills as they fall due,” she said.

CEC believes it is important that all parties take learning points from this incident and begin to uphold obligations in accordance with the Power Supply Agreement (PSA), she added in a statement following interventions by the Ministries of Mines to have the matter harmonized to avoid ‘sabotage’ to the economy.
“Irrespective of this decision, CEC still reserves all its rights per provision of the PSA with KCM, which CEC will exercise should it become imperative to do so in the near future,” Kalima added.

The refusal by KCM to pay against invoices issued for about six months, even on undisputed amounts, has adversely affected CEC’s business and subjected the power company to subsidizing and sustaining KCM operations for the said period.

As a consequence, CEC has also been unable to fully discharge its obligations to ZESCO Limited.

Despite their continuous defaulting on payments, KCM also argues that they are not liable to pay interest, in complete contravention of the PSA.

“All this is unacceptable in normal business practice and should not be encouraged,” Kalima stated.

KCM spokesperson Shapi Shachinda has since confirmed the restoration of power to affected areas of the mines but lamented that the discharge of water from underground would take some weeks to be undertaken.

This is in the wake of the company losing US$3.3 million in revenue as well as 482 tons of copper in interrupted production of the red metal over the past few days.

on the operations of the mines by the management and seeks that the miner should revive its operations by injecting fresh capital into the company, these sentiments were brought to light by Vice President and leader of Government business in Parliament, Guy Scott.

Responding to lawmakers, Scott said it was his view that fresh capital be pumped into the mining company.

The lawmakers wanted to know the future of the mining company in view of reports in the media to which Vice President replied; “Our Government’s view is that KCM needs a fresh capital injection. Our experts, consultants and advisors say there is a requirement to put in more money if KCM is to be more viable.

”When Government suggested to KCM to recapitalise the mine, the other shareholders, Vedanta, responded by saying Government itself through ZCCM Investment Holding must put in money, Scott added.

Vedanta had also further suggested that they be allowed to borrow money from the local banks.

Dr Scott said the idea of borrowing money locally would not be okay as other sectors such as agriculture would be affected, he told lawmakers during question and answer sessions on Sept. 26.

Meanwhile, Minister of Mines, Energy and Water Development Christopher Yaluma earlier on Sept. 25 cited poor management of Konkola Copper Mines (KCM) as the major reason the mining firm has failed to pay the Copperbelt Energy Corporation (CEC) US$44 million in electricity bills.

KCM is currently going through serious financial challenges and that Government is closely monitoring the situation at the company to ensure it does not result in job losses.

He told lawmakers that is sad that the giant mining firm will not be able to meet the set production levels in the next quarter due to the power supply which has been restricted to 90 percent by CEC instead of the required 100 percent.

“Mr Speaker, although KCM is capable of running the mine, it will not manage to meet the production levels we have set in the next quarter due to the power restriction.

“But what I have to state is that KCM is going through serious financial challenges due to poor management of the mine and this has also resulted in the company failing to pay the money it owes CEC in electricity bills,” the Minister said.

Earlier, KCM, through its parent company Vedanta Resources mocked Zambians over its U$500 million profit being made annually in the Southern African country since it invested a paltry US$25 million in 2004.

And President Michael Sata had earlier warned the company against undertaking its planned mechanization of the mining company in which over 1,579 workers were to be laid off to replace them with machinery.

President Sata had also warned Vedanta to follow the country’s policy of seeking to create employment than facilitate “redundancies” to the nationals.

However, Shachinda in a statement has reaffirmed KCM’s commitment to remain in Zambia and contribute to the country’s growing economy and that there were no plans to leave the country in spite of the current problems being faced.

Vedanta Resources have since 2004 invested close to US$4 billion in operations and corporate social responsibility programs.

Source: Mining News Zambia
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Enviro company limits dust at Zambia copper mine

Environmental management company I-Cat Environmental Solutions is supplying Zambian copper mine Kansanshi, owned and operated by mining companies First Quantum Minerals and ZCCM-IH, with its GreenGrip gravel road sealant.

The sealant eliminates dust on the mine’s semipermanent roads, preventing the adverse effects of dust on miners and reducing maintenance costs caused by dust-related failures, explains I-Cat Zambia director Chris Smit.

He notes that GreenGrip, which is an environment-friendly polymer-based product, was first applied at the mine in June 2013.

“Normally, mines use water to get rid of dust, but by applying GreenGrip, you prolong the effect, as GreenGrip has a special ingredient mixed with the polymer that binds soil and seals the road.

Dust is a huge problem on Zambian mines, particularly at this time of year, owing to the dry and windy conditions

– Chris Smit

“Instead of water bowser trucks constantly spraying water, GreenGrip needs to be applied only once every two to three days, depending on the dust levels at the mine. This significantly reduces maintenance and associated costs,” Smit tells Mining Weekly.

He notes that, while Zambia currently has air-quality laws in place, Zambian mines do not often adhere to them. This, however, is starting to change, says Smit, as international companies, which need to adhere to a country’s laws to remain operational, are becoming more prevalent in Zambia’s mining industry.

Smit highlights that dust is a huge problem on Zambian mines, particularly at this time of year, owing to the dry and windy conditions.

“Many people work in plant and pit areas, and on haulage roads, which are very dusty. Dust affects their health and, by applying these products, mines can reduce the dust levels by 40% to 50%, making a significant difference to the health of mine personnel,” he emphasises.

Smit adds that temporary roads, particularly around pit areas, that are not treated with GreenGrip are, however, treated with RDC 20, which is a more cost-effective dust palliative product offered by I-Cat.

Supplying Zambian Mines
He notes that I-Cat has been supplying the Zambian market since 2011 with its liquid soil additive RDC 20, which binds fine soil into heavier particles to prevent dust from becoming airborne. I-Cat has also introduced its new bitumen-based GreenBit product, which can primarily be used on main haulage roads to prevent roads from being washed away by rain.

“Owing to heavy rainfall in Zambia, GreenBit was developed in 2013 for application on main haulage roads and is currently being used on ferrous metals miner Assmang’s Bruce and King mines, in the Northern Cape, South Africa, with huge success. We apply this product to roads in Zambia to stabilise the roads during rainy seasons,” he explains.

GreenBit, as the name suggests, has an additive mixed with a lower dose of bitumen, which reduces the environmentally harmful impact of the more traditional bitumen-based products.

“We are an environment-friendly company and, as such, we strive to supply products to mines that have the same effects as a bitumen road – commonly known as asphalt – but with lower toxicity levels.

“Our mission is to prevent environ- mentally harmful products from spilling into runoff streams and dams, which is why we developed green products such as GreenGrip and RDC 20.

I-Cat Zambia has been registered with the Zambian Environmental Management Agency (Zema) since 2012 and all its products have been tested and declared environment-friendly by Zema.

Source: Mining Weekly
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First Quantum, Metorex mining increase Copper production, turnover in Zambia

Two of some of the leading multinational mining companies operating in Zambia, Africa’s leading copper producer, have found a niche for their investment and have this year increased mineral production and also increased their earnings.

First Quantum Minerals Limited, the Australian listed and diversified miner, with operations in Zambia at Kansanshi and the new ‘Greenfield’ US$2 billion Kalumbila Mine in north western province increased its copper production by four percent during the last three months to 30 June this year to 107,808 tons compared to 103.694 tons three months prior.

Copper sales per ton rose over 10 percent to US$114,449 against US$95,491 during three months ending 30 June this year at Kansanshi mine in Zambia as the cash cost of copper production per pound also increased to US$1.45 against an earlier US$1.34 three months earlier.

Nickel production in contained tons dropped to 10,651 against 11,927 three months earlier, although realized copper prices/per pound rose to US$12,223 against US$10,875 recorded three months prior to 30 June, the company said.

Gold sales rose US$60,135 against US$59,381 during the three months to 30 June this year while gold production dropped 60,723 ounces against 63,567 ounces three months prior to the period under review, it said in its report.

Sales revenues increased to US$945.1 million against US$869.3 million during the three months ending 30 June with gross profit rising to US$293 million against US$201.1 million.

Expected group production has been revised to be between 418,000 and 444,000 tons of copper, 45,000 and 48,000 tons for nickel, 221,000 tons and 242,000 tons for gold between 55,000 and 60,000 tons for Zinc respectively.

It has revised its capital expenditure for the group at US$2.4 billion from an initial US$2.2 billion, excluding capitalization of any pre-commercial production and capitalized interest.

Metorex Minerals Ltd. achieved a turnover of US$60.4 million at its owners Chibuluma Mine in Zambia during the six months ending 30 June this year as profit before tax re declined to US$14,490 at the end of the six months ending 30 June this year from US$15,888 recorded a year earlier.

Despite recording an increased production of the red metal to five percent, turnover for the company during its operations over six months remained flat chiefly on account of reduction in average copper price.

At 30 June, this year, Metorex Ltd’s Chibuluma mine spent US$3.8 million on development of its ‘Greenfield’ Chifupu copper project on the outskirts and south of Kalulushi on the Copperbelt, intended to extend the mine lifespan to the year 2020 from the estimated 2017.

To boost mine operations and increase copper outturn Metorex Mining, the owners of the Chibuluma mine have approved about US$24 million to be spent on the development phase of the Chifupu project and ensure it is done as scheduled, says Eustus Munsaka, Metorex’s Chief Financial Officer in his report.

During the period the company paid US$5.882 million to shareholders in interim dividends.

First Quantum Minerals and Metorex are among the multinational miners that emerged into Zambia after the privatization of the mining conglomerate-Zambia Consolidated Copper Mines (ZCCM) in the late 1990s as Zambia sought to promote private sector ownership of the mines in the copper-rich country.

Since the privatization of the mines, an investment of US$8 billion has been ploughed into the mines with copper production projected to rise to 1.5 million tons by next year and later rise to over 5 million tons by 2022, according to projections by the chamber of mines of Zambia, basing on the oncoming projects at various mining companies in the country.

Source: Mining News Zambia
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Mopani Copper Mines injects US$15 million in artisanal training scheme

Mopani Copper Mines, a unit of global commodity trader and diversified miner, Glencore Xstratra, has injected more than US$15 million in reviving an artisan training school in Mufulira, one of its operational areas following calls by the Government to improve skills training in the country and reduce on the industry relying on expatriates.

Previously, Zambian mines under the then Roan Consolidated Copper Mines (RCM) and Nchanga Consolidated Copper Mines (NCCM)-which together formed Zambia Consolidated Copper Mines (ZCCM), various mining companies had established training skills centres in various towns.

This was meant to encourage Zambians to learn various trades as part of the country’s effort to reduce on labour outsourcing, which saw many Zambians learn the ‘various trades’ and rose to senior ranks.

Among some of the Zambians that rose to senior positions at the time of ZCCM included then Superintendent, Albano Mutati, Pius Mambo and Francis Kaunda, among others as part of the Zambianisation of jobs by then President Kenneth Kaunda ostensibly to encourage the locals to run the mines.

However, with the continued outcry from Government on the need for the industry to maximize on locals to take up senior jobs and reduce on outsourcing, which has seen various Zambians fail to rise to senior positions, Mopani Copper Mines has taken a step ahead in meeting the desires of the Government.

In a statement by the miner, US$15 million (about K90 million) has been ploughed into constructing (reviving) a central training centre in Mufulira, which the company then under RCM had before the unbundling of the ZCCM conglomerate, to mitigate the critical shortage of artisan skills across Zambia’s mining industry.
Mopani Copper Mines chief executive officer, Danny Callow, says the continued growth of the copper mining industry in Zambia has led to a shortage of key technical skills and unavailability of suitably qualified and experienced local artisans. This situation necessitated the establishment of the training centre.

Callow stated that the training centre had been equipped with the world’s best engineering equipment and had so far enrolled over 140 students in its first intake. A total of 200 apprentices would be enrolled by the end of 2014.

Additionally, the Technical, Education, Vocation and Engineering Training Authority (TEVETA) accredited Centre, has come in handy and is offering courses under Mechanical Engineering that include, Fitting and Machining, Plating and welding, Heavy Mining Equipment Diesel Mechanics and Rigger Rope man. In Electrical Engineering, the school will offer courses in Electrical, Auto Electrical and Instrumentation.

The course being offered to the miners, Callow, added would last between two and three years. This was similarly the trend before under ZCCM, in which many Zambians learnt various trades ranging from fitting, electrical, boiler makers, metal fabricators and welders, among others.

It is envisaged, according to the syllabus being offered that the first class of fully trained artisans is expected to graduate in 2016 in which training will be accessible to Zambian school leavers and other local candidates seeking qualifications leading to a career within the mining industry.

According to Callow, the miner would spend a minimum of approximately US$20,000 annually on each apprentice in standard training and other related costs. Other than offering the training for free, Mopani would also provide the students with upkeep allowances, meals and accommodation and recreation facilities.

More than 30 years ago since Zambia’s mining industry became active, leading the country into becoming Africa’s leading copper producer-a feat it has maintained for the past 26 years, Zambia had well-established and funded training institutes that produced highly-qualified artisans and technicians for the mining industry.

Regrettably, the slowdown in copper prices on the international metal market in the 1970s which saw Zambia contribute a paltry 250,000 tons per annum from an average 700,000 tons earlier led to reduced investment in mining and training infrastructure.

Zambia was eventually forced to abandon artisanal training programmes on account that most undergraduates opted to pursue engineering courses at university level, Callow notes in his statement adding that the few remaining artisans could not satisfy the growing industry demand which led to the increased cost of hiring artisans.

During a recent workshop in Kitwe, northern Zambia, Chamber of Mines of Zambia President Emmanuel Mutati, an engineer himself, lamented the low skilled manpower-especially at Artisanal levels a situation he said needed to be reviewed to prop up the industry.

He attributed the decline to the development of the mines in north western Zambia, which has taken most of the skilled laborers to start up new projects in the area, now dubbed “The new Copperbelt” because of its vast mineral resources including gold and uranium.

Source: Mining News Zambia
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Local contractor commends joint venture partnership initiative by Mopani

Mopani Copper Mines Plc has implemented a number of programmes aimed at empowering and building capacity of local contractors and other small and medium enterprises in Zambia. The Company is encouraging formation of joint venture partnerships between local contractors and internationally-recognized and well-established foreign firms wishing to do business with the mining company. This has cheered the local contractors who have commended Mopani for coming up with the initiative.

One such joint venture supported by Mopani is between Shawonga Enterprises Limited of Zambia (33.3%) and ZINPRO Engineering of South Africa (66.7%). The two have partnered to form ZINPRO Zambia Limited, a company specialized in Shaft and structural steel rehabilitation works. ZINPRO Zambia has been engaged by Mopani to undertake massive refurbishment of the shaft infrastructure which Mopani inherited in a highly dilapidated state at privitisation.

Mopani Chief Executive Officer explains the company’s policy on joint ventures and the benefits that will be derived from supporting these partnerships:

“We have a deliberate policy that encourages foreign manufacturing companies wishing to do business with us to partner with local companies or involve Zambians in their shareholding structures. This, we believe, will help to build capacity of local companies, encourage skills transfer and give a competitive edge to the local firms whilst improving quality and efficiency,” said Mr. Callow.

Mr. Callow said initially attention was directed at improving processing plants and that time had come to address mining related issues.

“At privitisation we inherited highly dilapidated infrastructure both on surface and underground. Our major focus initially was to upgrade the Smelter to eliminate SO2 emissions and improve its efficiency. This project was completed 15 months ahead of schedule in March 2014 and is currently doing very well.

“Our focus now is to improve efficiency and productivity of underground operations. Maintenance of vertical shaft infrastructure is a highly specialised job and there is lack of local skills in this regard due to many years of lack of investment. Every month Mopani loses about 6000 metric tons of copper due to shaft shutdowns to facilitate maintenance.

“By bringing in shaft experts, ZINPRO Zambia Limited, Mopani will address the problem of frequent shutdowns and achieve continued production and less maintenance costs. This will also make shaft maintenance skills available in Zambia through the exchange that will take place as a result of the partnership,” Said Mr. Callow.

ZINPRO Zambia Operations Director, MrLondon Mwafulilwa has hailed Mopani for coming up with the initiative of supporting joint ventures. He has reiterated that the move will benefit all stakeholders involved, including the nation.

“First and foremost this venture is important to our Company because we are able to realize the full potential of the skills that are available, blend them with those of experienced hands and be able to participate in improving productivity in the mining industry as well as grow the mining support base. We are also able to provide employment and develop the local skills of the Zambian personnel,” said Mr Mwafulilwa.

He also reiterated that by partnering with ZINPRO Engineering, the local company has been able to upgrade its profile and working culture and expects a lot of future benefits.

“The ZINPRO Team has brought on board experience and an adorable working culture which most of our technical people do not have. The approach to how we look at the entire business has changed because we now drive solutions as compared to merely seeking contract opportunities.

“In the long term, there will be appropriate technology transfer and in the next 5/10 years we should have in the country dependable and reliable teams to be able to manage such projects without external expertise.”

Mr Mwafulilwa appealed to other local contractors to be consistent and prove their worth as opposed to seeking quick rewards. He further commended Mopani for the initiative.

“It is important for local contractors to remain focused and concentrate on their core business. This is the only way the mining industry will benefit from their input as they become specialists in their fields.

“Shawonga Enterprises Limited has been consistent for over 22 years of operation and therefore gained the necessary recognition from the players in the industry to a point where we are now able to contribute positively to the growth of the industry.

“I would like to commend Mopani for supporting such ventures as they create sustainable growth and support for the mining industry which can then be passed on from generation to generation. This is good not only for the mining industry, but the country as a whole especially that such specialised skills are getting fewer and fewer globally.

In order to promote efficiency in mining, Mopani is promoting other joint ventures between International world class contractors and solid, dependable local Zambian Contractors to form a Zambian owned, world-class mining contracting company by introducing expert skills and resources. This should lead to improved effectiveness and efficiency. The Company is further encouraging value addition and local procurement by empowering local manufacturers of various mining inputs such as cables, mill balls among other things.

Other local contractor development initiatives by Mopani include giving preference to local contractors before a tender can be extended to foreign contractors, Conducting capacity building workshops and trainings in addition to creating new business linkages for local contractors by assisting them to do business with other sister mines across the borders.

“Formation of joint venture partnerships, where Zambian companies take an equity stake, and add significant Zambian expertise to the newly formed company, create a win-win situation for all stakeholders. Empowering local contractors is a great step forward in developing the mining industry in Zambia in line with Government’s local content strategy,” Said Mr. Callow.

Source: Mining News Zambia
Investee Company News

Metorex Chibuluma Mines to spend US$26 million for explorations, official

Metorex Mining Limited, the South African based mid-tier mining group plans to spend over US$26 million to undertake exploration activities at its Chibuluma mine in Zambia over the next two years, says a mine official.

General Manager Jack Sikamo said while the company already spent US$12.7 million in strategic capital expenditure from 2010 to 2013, more resources have been earmarked in capital expenditure for 2014 and 2015.

In a paper presented during a workshop in Lusaka for various stakeholders recently, Sikamo stated that the company is also looking for acquisitions, explorations and joint venture partnerships with local or foreign companies to expand its operations in the country.

However, the miner is facing key challenges in the operations of the mining companies, among others, falls of ground, copper price reduction and increasing cost of production.

Government legislation without engagement, current resources mined out by 2020, skills retention, underground collisions, men/machines, safety, supervisor safety culture, historically supervisor- dependent and equipment availability and reliability are other challenges facing Metorex Mining Limited, a company established in 1995.

Chibuluma mine, formerly under Zambia Consolidated Copper Mines (ZCCM) and which produced 18,000 metric tonnes of copper last year, is expected to ramp up production to 19,000 metric tons of the red metal this year.

Metorex, a fully, owned subsidiary of Jinchuan International, was created with a vision to expand and explore activities in African base metal industry, based primarily on copper and cobalt production.

The company employing over 3,700 employees, generated group gross revenue US$408 million on copper sales of 45,000 metric tons and 3,000 metric tons of cobalt in 2012. It seeks to increase its outturn despite the challenges faced.

Chibuluma Mines plc is a modern mechanized underground copper mine owned 85 percent by Jinchuan Group Company Limited and 15 percent by ZCCM-IH plc.

The planned extensive exploration work is expected to extend its mine life by several years and significantly increase its minable reserves of both cobalt and copper.

Metorex Mining Limited, the South African based mid-tier mining group plans to spend over US$26 million to undertake exploration activities at its Chibuluma mine in Zambia over the next two years, says a mine official.

General Manager Jack Sikamo said while the company already spent US$12.7 million in strategic capital expenditure from 2010 to 2013, more resources have been earmarked in capital expenditure for 2014 and 2015.

In a paper presented during a workshop in Lusaka for various stakeholders recently, Sikamo stated that the company is also looking for acquisitions, explorations and joint venture partnerships with local or foreign companies to expand its operations in the country.

However, the miner is facing key challenges in the operations of the mining companies, among others, falls of ground, copper price reduction and increasing cost of production.

Government legislation without engagement, current resources mined out by 2020, skills retention, underground collisions, men/machines, safety, supervisor safety culture, historically supervisor- dependent and equipment availability and reliability are other challenges facing Metorex Mining Limited, a company established in 1995.

Chibuluma mine, formerly under Zambia Consolidated Copper Mines (ZCCM) and which produced 18,000 metric tonnes of copper last year, is expected to ramp up production to 19,000 metric tons of the red metal this year.

Metorex, a fully, owned subsidiary of Jinchuan International, was created with a vision to expand and explore activities in African base metal industry, based primarily on copper and cobalt production.

The company employing over 3,700 employees, generated group gross revenue US$408 million on copper sales of 45,000 metric tons and 3,000 metric tons of cobalt in 2012. It seeks to increase its outturn despite the challenges faced.

Chibuluma Mines plc is a modern mechanized underground copper mine 85 percent owned by Jinchuan Group Company Limited and 15 percent by ZCCM-IH plc.

The planned extensive exploration work is expected to extend its mine life by several years and significantly increase its minable reserves of both cobalt and copper.

Source: Mining News Zambia