Zambia will own some mining permits after mapping exercise
Zambia’s government intends to keep ownership of some mining licenCes that are shown to be promising by an ongoing mapping exercise and invite private investors to develop the assets alongside the State.
Africa’s second-biggest copper producer is pursuing ambitious plans to more than quadruple the metal’s output by the beginning of next decade. This increase will require companies to transform multiple exploration projects into operating mines. The government is currently funding an aerial geophysical survey to zero in on the best areas.
The state has set up a special purpose vehicle to push along investment, Mines Minister Paul Kabuswe said at a conference in the capital Lusaka on Wednesday. Some of the areas identified by the mapping “will be licensed within the SPV itself,” which will then approach partners about commercial arrangements for exploration and mining, he said.
In one possible scenario floated by the minister, the state company would have a 45% interest in a joint venture.
Subsidiaries of First Quantum Minerals and Barrick Gold Corporation produce most of Zambia’s copper, accounting for about two-thirds of output last year, according to government data.
Without going into detail about the state’s financial participation in the proposed joint ventures, the licenses on offer “must be taken as capital,” Kabuswe had said at the same event earlier. “Our contribution as a nation is what we discovered on that tenement because we’ve already put money in through mapping.”
The mines ministry and an industry group last week said they had resolved differences over a draft law that would have potentially given the state a bigger share of new mining projects.
Other investors in Zambia’s mining sector include Bill Gates-backed KoBold Metals, Abu Dhabi’s International Resources Holding, China Nonferrous Mining Corp. and Vedanta Resources Ltd.
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