Govt nods US$9.8m mineral resource tax rebate to CNMG
Written by Chiwoyu Sinyangwe
THE government has agreed to
give a rebate of US $9.8 million in mineral resource tax to China Nonferrous Metals Mining Group Co (CNMG) over the acquisition of Luanshya Copper Mine.
CNMG president Luo Tao said during the media conference last week in China that although the contract bid was worth US $50 million, the deal actually costs less for CNMG.
Luo said following the government’s decision to agree to give a rebate of US $9.8 million in mineral resource tax to CNMG in the acquisition of Luanshya Copper Mine (LCM), the transaction could be less than 20 per cent of the stated agreed price.
In May, the government picked CNMG to take an 80 per cent stake in LCM after the previous owners Enya Holdings BV put the mine on care and maintenance last January, blaming the decision on the depressed copper prices at the time when the global economic crisis climaxed.
And CNMG’s acquisition of LCM has won final approval from China's State Administration of Foreign Exchange (SAFE).
According to Alibaba News, the deal marks CNMG's third overseas purchase of mines and the second investment in Zambian copper mines following the state-owned nonferrous metal company’s acquisition and exploitation of the Zambian Chambishi copper mine in 1998.
"The purchase adds nearly 3 million tonnes of resource reserve to CNMG and the company is striving to increase its total capital to 50 billion Yuan by the end of this year," said Luo.
CNMG won the bid on May 8 this year and took over Luanshya Copper Company in June.
The transfer of shares from Enya Holdings to CNMG was enmeshed in controversy as most analysts contended that US $50 million was way beyond the market value for the mine.
Sources close to the deal argued that the value of transfer should have been gon close to US $100 million to help commensurate the company’s total liability which at the time was estimated to be around US $120 million.
Labels: CHINESE, CORRUPTION, ENYA HOLDINGS, MINING, TAXATION
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Baluba Copper Mine starts blasting
By Business Reporter
Baluba Copper Mine has started blasting for copper and other underground activities ahead of planned resumption of production in December. This comes after the mine’s completion of most of the rehabilitation works and replacement of obsolete machinery by the new owners, the Non-Ferrous Corporation (NFC) Africa.
Baluba Mine is a unit of Luanshya Copper Mine (LCM), in which China Non-Ferrous Corporation (CNMC) recently bought
85 per cent shareholding from
Enya Holdings, which withdrew and placed the mines under care and maintenance.
The balance of the stake in Baluba is held by the Government through the ZCCM Investment Holdings (ZCCM-IH).
CNMC took over the operations of the Baluba and Mulyashi copper project, which was due to start producing 60,000 tonnes of copper in 2010, and said it would spend US$400 million to develop Mulyashi and start operations at Baluba.
NFC Africa chief executive officer, Luo Xingeng said in a statement released in Lusaka yesterday that the company had undertaken the major rehabilitation works involving replacement of equipment.
Mr Luo said the replacement of obsolete and outdated equipment was almost over, and the company conducted the first blasting last Sunday morning.
“The previous investor had exhausted all the developed reserves and the development being embarked on is both primary and secondary,” he said.
The Government had initially said production at Baluba would start in May this year when the takeover was completed, but the new owners undertook a thorough study on the assets and operational requirements.
Mr Luo said the study had revealed that the cost of rehabilitating and replacing equipment at Baluba had risen.
He said NFC Africa would give priority to the development of the Baluba underground mine, the 11.4kilometre cable that conveys copper ore from the mine to the processing plant, and the upgrading of the copper processing plant.
“Initially, $60 million was earmarked for the rehabilitation and replacement of equipment but the figure has gone up to $74 million after more malfunctioning equipment was discovered,” he said.
Previously, underground development at Baluba mine was carried out by a contractor but CNMC had decided that they should carry out the development on their own.
Mr Luo said NFC Africa has since employed 200 former workers at Prosec Amco, the previous contactor, as part of the underground development team.
Enya Holdings, which is a joint venture of the Bein Stein Resources Group (BSRG) and the International Minerals Resources (IRM), previously owned LCM but they placed the mine under care and maintenance in December before CNMC purchased it for US$50 million.
Labels: BALUBA MINE, CNMC, COPPER, ENYA HOLDINGS, LCM
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Chambishi Metals set to resume operations
Written by Chiwoyu Sinyangwe
July 03, 2009 3:12:08 PM
CHAMBISHI Metals is set to resume operations this month-end after failure to clinch deals for the vital raw materials delayed the scheduled reopening last May, chief executive officer Derek Webbstock said yesterday.
In an interview, Webbstock said management of the country’s largest cobalt producer was currently negotiating with some mining companies in Zambia and the neighbouring Democratic Republic of Congo (DRC) for the supply of cobalt and copper concentrates.
“We expect to conclude the negotiations with some mines both here in Zambia and DRC and we expect to sign the contracts during the course of this month for resumption of operations at the end of July,” Webbstock said.
He however did not disclose the mines Chambishi Metals was negotiating with for the supply of the inputs into the mine which was placed under care and maintenance in December in tandem with Luanshya Copper Mines (LCM) after the collapse of metal prices on the international market.
Enya Holdings – a consortium of Bein Sten Group Resources (BSGR) and International Mineral Resources (IRM) – own Chambishi Metals and are the immediate past owners of LCM in Luanshya which has now been sold to China Non Ferous Corporation Africa (NFCA).
Webbstock said Chambishi Metals would look to LCM as a possible source for concentrates once the mine expected to be re-opened next January comes on stream.
“We are also considering the Chinese in Luanshya but those would take time before they resume production,” said Webbstock.
Last March, LCM announced that it was going to keep Chambishi Metals and promised to resume operations within two months after securing supply for concentrates from Zambia and the DRC.
The company further announced that Chambishi Metals would re-employ 500 to 600 of the 900 workers that were fired last December.
Chambishi produced about 2,500 tonnes of cobalt before its closure although its owners had wanted to raise output to about 3,400 tonnes. It had also planned to produce 20,000 tonnes of B-grade copper.
This week, former workers of Chambishi Metals complained of the delayed re-opening of the mine and demanded that the government takes over the mine from Enya Holdings LCM and seek a new investor to ensure the speedy resumption of its operations.
Labels: BENY STEINMETZ GROUP RESOURCES, CHAMBISHI MINE, DRC, ENYA HOLDINGS
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Chinese group to take over Munali Nickel mine
Written by Chiwoyu Sinyangwe
Tuesday, June 16, 2009 7:35:46 AM
CHINESE influence in the country’s mining sector is steadily increasingly with China’s giant metal producer, Jinchuan Group set to take over operations of Munali Nickel mine from Australian-based Africa-focused exploration and development company, Albidon.
Just last week, the government announced that China Nonferrous Mining Corporations (CNMC) was to take over 80 per cent of the stake in Luanshya Copper Mines (LCM) which was placed on care and maintenance last January by its previous owners, Enya Holdings, citing low copper prices at the time.
According to mines minister, Maxwell Mwale, the country’s inaugural and sole nickel mine was expected to re-open next month after operations were suspended in January owing to low nickel prices.
Mwale said Jinchuan Group, the off-take partners for Albidon Zambia, was considering increasing its stake in the mine to about 80 per cent from the current 20 per cent.
“Within the next one month they should be on course...as I was leaving (Zambia) they had already agreed on the scheme of arrangements,” Mwale told Reuters in an interview on the sidelines of the World Economic Forum for Africa in Cape Town.
Prior to the shutdown of the mine, Jinchuan had a life-of-mine off-take agreement with Albidon.
At full capacity, the mine, which came on stream in May 2008, was expected to produce about 10,500 tonnes of nickel annually.
By the time the mine was suspended, nickel prices on the London Metal Exchange had plummeted by about more than 80 per cent.
Labels: CHINESE, CNMC, ENYA HOLDINGS, FDI, LCM, MAXWELL MWALE, MUNALI NICKEL MINE
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