Mopani Copper Mines Reports Declining Output and Deeper Losses
In the first half of this year, Mopani Copper Mines witnessed a significant drop in production, leading to increased financial losses for the operation, which was acquired from Glencore in 2021.
According to a statement by the parent company, ZCCM-IH, Mopani’s losses in the six months through June escalated to $196 million, in contrast to $120 million during the corresponding period in the previous year.
This deterioration in financial performance can be attributed to both a reduction in output and escalating operational costs. Copper production during this period dwindled to 14,946 tons, down from 20,000 tons in the same period last year.
These ongoing financial setbacks compound Mopani’s challenges, following a substantial loss of $298 million in the previous year, in contrast to $74.2 million in 2021.
Mopani Copper Mines came under the control of Zambia’s state-owned ZCCM in 2021, following an agreement to acquire the operation from Glencore for $1.5 billion, a deal financed through debt arrangements.
Subsequently, ZCCM has been actively seeking a new investor to take over the Mopani assets. Rothschild & Co is overseeing the process of selling the mines, with expectations of completing the transaction by December, as confirmed by ZCCM.
The prospective investor is anticipated to inject funds into ongoing projects initiated by Glencore, aimed at boosting copper production to approximately 200,000 tons per year by 2027.
Rothschild & Co has narrowed down the list of potential buyers for Mopani to Sibanye-Stillwater and Zijin Mining Group.
To expand production over the next three years, Mopani necessitates a $300 million investment, along with an additional $150 million to sustain its ongoing operations, according to ZCCM.
