COPPER Multi-million dollar developments promise major boost
Mega projects starting to get under way

Kansanshi mine, where First Quantum Minerals are investing a total of $360 million.

Copper output, which has seen a steady rise in Zambia over the last five years, is set to receive a major boost as several mega investment projects move forward.

Heading the list is the Konkola Deep Mine Project in the Copperbelt, a $600 million (£335 million) investment launched by President Mwanawasa in May. In the New Copperbelt in North Western Province, another huge development taking shape is the Lumwana Copper-Cobalt Project, and commercial production is already under way at First Quantum’s multi-million dollar Kansanshi mine.

Plans by Mopani Copper Mines (MCM) to invest $90 million (£50 million) in turning the Mufulira smelter into one of the largest in the world reflect the widespread confidence in the future of copper mining in Zambia.

The new facility will have the capacity to serve the new mines coming on stream, in addition to meeting MCM’s own requirements. New technology will boost current handling capacity of 420,000 tons of copper concentrate per year to 850,000 tons. “We see it as a strategic move made at just the right time,” says CEO Tim Henderson.

The Konkola Deep Mine Project will boost production at Zambia’s largest mine, from two million tons of copper ore per year to six million tons. The complex project involves the sinking of a new shaft and construction of an additional three million tons per annum concentrator.

London-listed metals and mining group Vedanta Resources paid $48 million (£27 million) for a 51 percent stake in Konkola Copper Mines (KCM) last year, thereby becoming the world’s fifth largest producer of refined copper.

KCM’s Chief Executive Officer, C. V. Krishnan, believes Zambia is an excellent place for investment. “We are fully committed to making KCM a world-class copper company that will continue to contribute significantly to the GDP of the country and export earnings,” he says.

Development of Lumwana, one of the largest undeveloped copper projects in the world, wholly owned by Canada’s Equinox Minerals, is expected to cost $333 million (£186 million). In the first five years of production, due to start in 2007, output is expected to be 140,000 tons of copper and 2,300 ounces of gold per annum. Thereafter, the mine will produce 104,000 tons of copper per year, 1,000 tons of cobalt and 230,000 tons of acid.
Commercial production began at Kansanshi mine in April. First Quantum is planning further investment there next year, bringing their total investment at the mine to $360 million (£201 million). Kansanshi is believed to contain 4.5 million tons of copper and is expected to operate for 30 years. Production is on target to hit a forecast 91,000 tons of copper for 2005, and will rise to 150,000 tons per annum.

Jim Gorman, General Manager of Kansanshi Mining, hails the mine as “a beacon for success”. He adds, “We are here to stay.”

First Quantum owns 80 percent of Kansanshi and 100 percent of Bwana Mkubwa mine. It is currently expanding its operations in the neighbouring Democratic Republic of Congo (DRC) and Mauritania. In DRC the company operates the Lonshi open pit copper mine, which provides oxide copper ore for processing at Bwana Mkubwa.

Matt Pascall Operations Director at First Quantum “Speed is part of our strategy”

First Quantum’s Operations Director Matt Pascall says the medium-sized scale of First Quantum’s operations allows it to waste no time in bringing mines into production. “It’s not by chance that we brought Lonshi and Kansanshi in quickly. It’s an essential part of our business strategy. One official referred to us as ‘Fast Quantum’ and we take that as a compliment.”

Mr Pascall says that rising global demand offers Zambia a not-to-be-missed opportunity. “World consumption of copper is currently about 15 million tons a year. The copper industry is now close to the size it was in its heyday, or will be in a year or two.”

Chinese companies are also active in Zambia and have invested nearly $170 million (£94.6 million) in the mining sector. NFC Africa, which owns the Chambishi mine on the Copperbelt, recently announced a $150 million (£83.5 million) rehabilitation programme.

Switzerland’s J&W Investments Group entered the sector in 2003 when it took over and revitalised Chambishi Metals, the largest cobalt refinery operation in Africa. Since then it has bought Luanshya and Baluba mines, and has committed itself to a multi-million dollar restoration of operations.

“We are looking at significant investment in Chambishi to consolidate our operations and utilise Luanshya feedstock,” says Jerry Gorman, Chief Executive Officer of both Chambishi Metals and Luanshya Copper Mines (LCM).“We are currently evaluating other projects in Zambia.”