3.1% KANSANSHI MINE REVENUE SHARE A GOOD DEAL FOR ZAMBIA
The Zambia Chamber of Mines has described the 3.1% revenue-based royalty secured by ZCCM-IH in its negotiations as being “at the top end of the range” and a good deal for the country normally seen for this type of arrangement.
In a statement made available to the Zambian Business Times – ZBT, Chamber of Mines CEO Sokwani Chilembo stated that “this is a good deal for ZCCM-IH, when you look at the international comparisons”.
He revealed that ZCCM IH and to a larger extent Zambia has secured a regular, consistent source of income from Kansanshi [mine] which will allow them to deliver on their strategy of becoming a real player in Zambia’s mining industry, throughout the mining value chain – and that is what ordinary Zambians need to see.
“It’s time we stop misrepresenting the facts, otherwise our opinions – and the quality of our public debate – will be detached from reality. We must start getting behind the industry as an engine for national development, rather than just scoring points for points sake”, Chilembo stated.
The announced deal between ZCCM IH which holds 20% shares in trust for the Zambian government in Kansanshi mine and First Quantum Minerals – FQM to convert dividend rights to royalty or revenue share rights has raised public suspicion that the deal will lead to an irreversible loss of control and significant influence of the government and Zambia in Kansanshi Mine.
But the Chamber of Mines has called for causion at what they described as “point scoring behaviour by pundits” stating that this is wilfully misrepresenting the benefits and history of a deal that will be good for the mining industry and good for the country.
The negotiations between ZCCM-IH and First Quantum to provide ZCCM-IH with royalty income from Kansanshi mine have been ongoing for the past three years. So, this shocked outrage is misplaced, and being mostly fuelled from quarters that were privy to the historical background of the negotiations”, said Chilembo.
The agreement that FQM and ZCCM-IH have entered into calls a halt to the tit-for-tat legal disputes between government and its main mining investor, that have caused great reputational damage, and come at a great cost for both parties in time, money and effort.
“Now the partners in Kansanshi can get back to the business of mining, and delivering upon the very positive and long-awaited development of the s3 expansion at the mine”.
“This cessation of hostilities is extremely important for our optics in the global landscape and will be a comfort to other potential investors – because make no mistake, we need many, many more investors if we are to realize the objective of delivering anything like 3 million tonnes of copper a year”, Chilembo stated
