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In accordance with Section 81(1) of the Securities Act No. 41 of 2016, the Board of Directors of Copperbelt Energy Corporation Plc (“CEC” or “the Company”) advises the Company’s shareholders, and the market, that further to the Market Announcement issued by the Company on 2nd January 2020, the power purchase agreement or Bulk Supply Agreement (“BSA”) between CEC and ZESCO Limited (“ZESCO”), entered into on 21 November 1997 came to an end on Tuesday, 31st March 2020.

In the last circa seven weeks, CEC and a Government of the Republic of Zambia (“GRZ”) team which included ZESCO have been engaged in negotiations for a new power supply agreement. While the initial understanding was that the parties would work to put in place an interim agreement, it became clear during the negotiations that the intention was to agree a wholesomely new agreement with totally different terms. CEC believes that throughout the negotiation, it held its end of approaching the negotiations in good faith. At end of day on 31st March 2020, the parties had not reached agreement on account of certain terms seen as key requirements from either side and which so far are not acceptable to either party. On its part, CEC has faced some terms being demanded by the GRZ team which, if accepted, would be injurious to the CEC business and impact its ability to continue operating as a going concern.

In CEC’s view, achieving a mutually acceptable power supply agreement between the parties remains of strategic importance to the electricity sector and the country. Therefore, CEC remains confident that the parties will use the next several weeks to narrow the negotiation gap so as to achieve the much required new power supply agreement between them.

CEC wishes to assure its shareholders and all stakeholders that it will do its best to ensure that any agreement it enters into will be negotiated in good faith and reflect a fair outcome so as to ensure the business continues to operate as a going concern thereafter.

It is CEC’s understanding that in the meantime, both CEC and ZESCO remain committed to continue meeting their full obligations to their customers without service being affected in any way. On its part, CEC reiterates its total commitment to continue providing seamless power supply services to all its customers (mining and non-mining consumers) on the Copperbelt while the parties continue to seek resolution of the outstanding matters and follow through with conclusion of the negotiation for a new power supply agreement.

By Order of the Board

Julia C Z Chaila
Company Secretary

Issued in Lusaka, Zambia on Wednesday, 1st April 2020

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Konkola Copper Mines supports fight against Coronavirus

March 31, 2020 16:55April 9, 2020

CHINGOLA, 31 March 2020: Konkola Copper Mines (KCM) has provided two clinics in Chingola and Chililabombwe, as holding centres for people who will be suspected to have Coronavirus (COVID-19) in the two districts, and one million two hundred thousand kwacha (K1.2 million) for medical equipment and supplies.

Acting Konkola Copper Mines General Manager Corporate Affairs Shapi Shachinda said the Nchanga South Clinic in Chingola will have a bed capacity of 28 with a possibility of putting up tents on the premises in order to increase capacity in the event of overwhelming numbers, while Clinic 5 in Chililabombwe will initially have at least 5 beds.

The two facilities will be handed to the Ministry of Health in the interim period as holding centres for future COVID-19 suspected cases and will be reverted to normal medical use as Out-patient facilities for KCM once the war against COVID-19 is won.

Mr Shachinda commented: ‘KCM is opening up the two clinics for purposes of holding people who will in the future be suspected to have the Coronavirus, while awaiting their transfer to the main Government isolation centre on the Copperbelt in Masaiti district. The company will also release K1.2 million for procurement of medical equipment and supplies.’

KCM will procure equipment such as ventilators, oxygen concentrators, data scopes, autoclaving machine, incinerator, hand-washing facilities for use during the fight against COVID-19, he said.

Konkola Copper Mines is supporting efforts by the new District Commissioner for Chingola, the Government’s and KCM medical teams to prepare for the management of any reported and confirmed cases of Coronavirus.

‘We have a huge responsibility as a corporate citizen to support the Government’s broader plans to protect people from contracting Coronavirus and to fight the virus in the event that some people would have contracted it in the future,’ Mr Shachinda said.

Konkola Copper Mines has put in place communication protocols to educate and enlighten more than 12,000 permanent employees and those working for its business partners on the prevention of COVID-19, including providing sanitizers in operational areas. The company has printed posters and banners in English and local languages with key messaging, and some of the initiatives will be rolled out to communities in the company’s areas of operation.

Source: Market Screener

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Mining firms in Zambia welcome tax relief measures

March 31, 2020 16:37April 9, 2020

LUSAKA, March 31 (Xinhua) — Mining firms in Zambia on Tuesday welcomed the government’s decision to suspend export duty on precious metals and import duty on mineral concentrates in order to cushion the mining sector.

Last Friday, Finance Minister Bwalya Ng’andu announced that the government will suspend export duty on precious metals and import duty on mineral concentrates to cushion the mining sector.

The Zambia Chamber of Mines, an association of mining firms, said the move was the first step in the direction that must necessarily lead to a broader relief package similar to that being deployed by other countries in the face of the coronavirus.

“The value of this announcement is greatly geared towards making better use of latent tertiary ore smelting and refining capacity while the bulk of the industry’s core primary mining and metallurgical processing continues to need cashflow relief to make it through this fight for survival,” Sokwani Chilembo, the chief executive officer of the association said.

He said the response was a crucial recognition on the part of government that it must change tack from its prior focus on raising taxes at all costs.

Zambia, Africa’s second largest copper producer, introduced the taxes which came into effect in January 2020. Mining firms rejected the taxes saying they will kill the industry.

Analysts have since welcomed the government’s decision saying it will bring relief to the mining sector.

Source: Xinhua

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KCM Joins Covid 19 Fight

March 31, 2020 16:27April 9, 2020

ZANIS—Konkola Copper Mines (KCM) has set aside K1.2 million for stocking all consumables and supplies that will be used in the fight against coronavirus at Nchanga South Clinic which the mining company has surrendered to government as a quarantine centre for suspected case of the deadly virus.

KCM acting General Manager Corporate Affairs Shapi Shachinda said the mining firm has decided to offer the facility to government during this period until the COVID 19 cases are over.

Mr. Shachinda told ZANIS that the funds released will be used to ensure that the facility has all the supplies needed.

He said the facility, which was an outpatient department for the mining firm, will be used as a quarantine centre for COVID 19 suspected cases in a bid to fight the pandemic.

He explained that additionally, KCM has also put up activities to sensitise workers on precautionary measures to combat the further spread of the coronavirus.

And Chingola District Commissioner Agnes Tonga, who toured the facility, has thanked KCM for supplementing government’s efforts in fighting COVID 19.

Ms. Tonga added that if all stakeholders could emulate KCM by partnering with government, the deadly disease can be contained.

Source: ZNBC

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Effects of COVID-19 Disease on the Zambian Mining Industry

March 31, 2020 16:00April 9, 2020

ZCCM Investments Holdings Plc (ZCCM-IH) has said that the company intends to appeal against the Ruling of the Lusaka High Court delivered on 23 March 2020 regarding a matter the firm commenced in 2016, against First Quantum Minerals Limited (FQM Ltd), FQM Finance Limited, Philip Pascall, Arthur Mathias Pascall, Clive Newall, Martin Rowley, and Kansanshi Mining Plc.

In a statement released to the media, ZCCM-IH said that the defendants’ conduct, allegedly, among others, that the defendants on several occasions fraudulently engaged in transactions totaling in excess of $2 billion for the benefit of the FQM Group, is detrimental to ZCCM-IH’s interests and those of the nation, and remained committed to protecting the said interests, adding that it will be appealing against the Ruling.

In 2016, ZCCM-IH started the process of claiming up to $1.4 billion from First Quantum Minerals Ltd accusing the firm of engaging in fraud. The claim included $228 million in interest on $2.3 billion of loans that ZCCM-IH said First Quantum wrongly borrowed from the Kansanshi copper mine, as well as 20 percent of the principal amount, or $570 million, according to an internal company presentation, dated Nov. 4, 2016.

ZCCM-IH is also seeking $260 million as part of a tax liability the Zambia Revenue Authority said Kansanshi owed it, as well as the cost of the mine borrowing money commercially that ZCCM-IH said could have been avoided.

In papers filed in the Lusaka High Court on Oct. 28 2016, ZCCM-IH said that First Quantum used the money as cheap financing for its other operations.

ZCCM-IH is triple listed on 3 stock exchanges: the Lusaka Securities Exchange (Primary listing) and on the London Stock Exchange and the Euronext Access (Paris – Marche Libre) (Secondary Listings).

Government holds directly 17.25% shares and its 60.28% shares is held through the Industrial development Corporation (IDC) in Zambia, with the remaining 22.47% held by institutional and private individual shareholders.

ZCCM-IH currently has an investment portfolio of 22 companies, including Kansanshi Mining Plc (20%), Mopani Copper Mines Plc (10%) and Konkola Copper Mines Plc (20.6). Its shareholdings in these companies range from 10% to 100%, with commodities and services that are diversified in nature, including copper, gold, cobalt, coal and power, limestone, mining consultancy, financial services and gemstones.

Source: Lusaka Times

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ZCCM-IH to appeal against the Lusaka High Court judgment delivered in favour of First Quantum Minerals

March 30, 2020 16:06April 9, 2020