News

September 18, 2008

Interesting Goings-On At Zambian Consolidated Copper Mines

By Michael Coulson, who has just published a 2nd edition of his ‘An Insider’s Gu

There have been some significant developments down in Zambia in the wake of Minesite’s earlier story that the Zambian government might be prepared to reconsider the new levels of mining tax that it’s imposing, if the government’s own 87 per cent owned Zambian Consolidated Copper Mines (ZCCM) started to receive meaningful dividends from its Copperbelt joint ventures. A particular emphasis was laid on the Kansanshi project.

We now understand that First Quantum, the Canadian miner which operates Kansanshi, has entered into discussions with ZCCM about the payment of dividends from ZCCM’s accumulated but undistributed share of Kansanshi’s profits. These, after taking account of ZCCM’s share of Kansanshi development and capital spending, are believed to be well north of US$100 million and rising fast. The problem that has arisen for ZCCM is that when the Zambian copper industry was restructured in the early part of...