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New Lumwana MD hails Zambia’s tax regime

New Lumwana MD hails Zambia’s tax regime
By Joe Kaunda
Thu 26 Nov. 2009, 07:00 CAT

Lumwana Mining Company Limited’s (LMC) recently appointed managing director Adam Wright has hailed Zambia’s tax regime as encouraging to investment in the mining sector.

Wright, at his first briefing to the press since taking over as LMC’s managing director earlier this month, said in Lusaka yesterday that government had foresight in putting in place the current tax regime including an array of tax measures aimed at encouraging investment in the sector.

He said while LMC, the largest copper mining project in Africa with an estimated investment of almost US $1 billion, had received concessions from government, the general tax regime for the sector was attractive even to other investors.

“It is important that those measures permit not only our investment but are also seen by the investment community as attractive a package and they will attract other investors,” Wright said.

He said LMC was focused on making the mine robust so that it could survive any future challenges including a possible downturn in the price of copper.

“The secret is not just cutting costs or cutting labour, the secret is to be in full production and produce as much copper as possible and also as efficiently as possible,” Wright explained. “So we are raking up and hiring more people so that we can achieve higher production and we are not anticipating any reduction in labour.”

He further disclosed that the LMC was focusing on employing local people and also creating opportunities for the local communities.

He said a long term project of scholarships to some school children and youths at the universities had already been started to ensure that the local benefited from training that would ensure they are taken on by the mine which has an estimated production life of 37 years that can be extended.

Wright highlighted some challenges in production being the location of the open pit mine in a rain belt including some logistical hurdles but added that LMC was learning to deal with such challenges every year and did not see this persisting into the long term.

“The wet season is upon us and that is quite a challenging period for an open pit but there are no obstacles that can’t be overcome. The mine is actually better prepared this season for the wet season than it was in the previous season, and every year we will learn about how we can deal with these challenges,” he said.

Wright further explained that LMC’s concentration is to ensure that it retires its debt owed to a syndicate of financiers who, together with Equinox Minerals facilitated the US$ 1 billion investment to establish the mine.

The liquidation of the debt would ensure benefits to all stakeholders including government, shareholders and the community in the 37 years of LMC’s estimated mine life.

LMC is wholly owned by Equinox Minerals which is dual listed in Sydney, Australia and Toronto in Canada.

According to Wright there has been a consistent increase in copper concentrate in the past three quarters this year with the trend expected to continue in the fourth quarter.

He said LMC had this year produced 22,000, 24,000 and 28,000 metric tonnes in the first, second and third quarter respectively and was hoping to achieve over 100,000 tonnes of copper concentrates with an expected improvement in production next year.

On Uranium, LMC which has high grade mineralization within its Malundwe pit is currently just stockpiling the ore with the potential to build a uranium processing facility in future.

Wright who took over from Harry Michael this month hailed his predecessor for building the mine and said the focus should now be on attaining full production especially with the current favourable prices on the market.

Prior to the LMC posting, Wright who holds a Masters degree in Mineral Process Engineering from the Royal School of Mines in London, was in Papua New Guinea where he was building a gold mine. He has worked in Venezuela and in Canada in Quebec including Namibia at a uranium mine operation.

LMC is located approximately 85km away from the provincial capital of North-Western Province, Solwezi.

Labels: HYPOCRISY, LUMWANA MINING COMPANY

posted by MrK @ 11:52 AM