A system of conveyor belts at the Nchanga copper mine, operated by Konkola Copper Mines Plc, in Chingola, Zambia Picture: GETTY IMAGES/WALDO SWIEGERS
A system of conveyor belts at the Nchanga copper mine, operated by Konkola Copper Mines Plc, in Chingola, Zambia Picture: GETTY IMAGES/WALDO SWIEGERS

Lusaka — Zambia is looking for a new investor in Vedanta-controlled Konkola Copper Mines (KCM), President Edgar Lungu says, in a move likely to stoke international miners’ concerns about rising government intervention in the sector.

Zambia, Africa’s second-biggest copper producer, has also proposed tax changes that Lungu insists he will push through, despite opposition from international miners who say they will deter investment that Zambia desperately needs.

“We are not shaken in our resolve to divorce [from some companies], starting with KCM, and we have filed that notification,” Lungu said on Zambia National Broadcasting Corporation radio on Monday.

The decision follows a number of breaches of the terms of KCM’s mining licence, presidential spokesperson man Amos Chanda said. “The government is planning to revoke KCM’s mining licence because of the breaches,” Chanda said.

London-listed Vedanta said it was seeking an urgent meeting with Lungu over the future of KCM and that it had not received formal communication from the government on issue. It said it was the intention of KCM and Vedanta, its primary shareholder, to continue to engage with the government “in a constructive and transparent manner”.

The government, which also has a stake in KCM through a state mining company, “is fully apprised of and party to the circumstances of the company and major decisions that have been taken”, Vedanta said.

Chanda said a default notice had been issued to KCM in April 2018 for a number of breaches and that it had not convinced the government that it should keep its licence. He said “about three investors” whom he could not name were interested in the asset, but no negotiations had begun.

“Everything will be done within the law and that’s why we cannot name the interested investors until the separation process with KCM is done,” he said.

Reuters