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Wednesday, May 18, 2022
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HomeBusinessFQM PUMPS $1 BILLION INTO KANSANSHI MINE EXPANSION

FQM PUMPS $1 BILLION INTO KANSANSHI MINE EXPANSION

 

By JOHN CHOLA

Renewed confidence in Zambia’s investment climate has prompted First Quantum Minerals (FQM) to approve plans for a $1.25 billion expansion of the company’s Kansanshi copper mine.

The mine said on Sunday that its Board has approved plans for a $1.25 billion expansion of the company’s Kansanshi copper mine in Zambia, a plan first floated in January 2020.

FQM is quoted as saying that since President Hakainde Hichilema’s election last August, Zambia has implemented business-friendly reforms including allowing mining companies to deduct mineral royalties from their income tax assessments.

The global mining giant says such reforms in particular were key to unlocking approval for the Kansanshi expansion, saying it “realigned Zambia with international best practice.”

And FQM also said it had approved a further US$100 million investment in its Enterprise nickel project in Zambia, which it expects to start producing in 2023, ramping up annual production to 30,000 tonnes of concentrate.

FQM states that the $1.35 billion package overall represents the largest investment in Zambia since its Sentinel project was approved in 2012.

FQM said it had also reached an agreement with the Zambian Government on outstanding value-added tax repayments owed to it and an approach for repayments based on offsets against future mining taxes and royalties.

The announcement came just ahead of the Mining Indaba conference in Cape Town where Hichilema delivered a key note speech on Monday May 9, 2022 aimed at drawing new investment into the country’s mining sector.

According to  Finance Minister Situmbeko Musokotwane, the country, which is Africa’s second-biggest copper producer, aimed to increase production to three million tonnes of copper a year within the next decade.

Zambia produced 800,696 tonnes of copper in 2021.

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