Scott to meet MCM, ZEMA over closed leaching plant
By Misheck Wangwe in Kitwe
Tue 27 Mar. 2012, 12:57 CAT
VICE-PRESIDENT Guy Scott is today expected to meet Mopani Copper Mines and ZEMA in Lusaka to discuss the future of the closed Mufulira West Heap Leaching Mine. And the Southern Africa Resource Watch, which will be part of the meeting, says it expects the government to take punitive measures against Mopani for abrogating the law and polluting the environment.
The Zambia Environmental Management Agency (ZEMA) closed Mopani's the Heap Leaching Mine three weeks ago following complaints by residents of Butondo about massive pollution.
Mopani Copper Mines chief executive officer Danny Callow who confirmed the development said the company hoped that the meeting with the Vice-President Scott would address the issues surrounding the closure of the mine.
Callow said due to the closure of the mine, the company was losing about K525 million a day.
He said 310 jobs might be lost if the mine were not reopened.
"Our hope as a company is that the current situation will not continue because we need to save the mine and the potential job losses which we view as serious. We hope by tomorrow (today), a resolution will be found on how to restart the mine again while making sure that all stakeholders are happy," Callow said.
He said prior to the stop notice which was issued by ZEMA, Mopani engaged the residents of Butondo in a stakeholders forum to try and address the issues surrounding the operations of the Heap Leaching Mine and the acid mists that were allegedly affecting the residents.
Callow said Mopani Copper Mines attached great importance to issues of environmental health and its operations would always be within the confines of the law.
And Southern Africa Resource Watch campaign officer Edward Lange said Mopani Copper Mines must be given a time frame in which to adhere to the set out benchmarks given to them by ZEMA.
Lange said ZEMA and Mopani had the responsibility to ensure protection of the environment and the lives of the people of Butondo before reopening the mine.
"We are going into this meeting with a view that Mopani must be put in its rightful position. We have laws that govern this country and this company is not above the law. The situation on the acid mists that were being released and affecting the people and the environment was extremely unacceptable," said Lange.
Over 3,200 Butondo residents in Mufulira have been pressing government and ZEMA to take action over the strong acid mists that were being produced by the Heap Leaching Mine and had allegedly affected people's health since 2006 when the ponds were commissioned.
ZEMA northern region manager Patson Zulu said the environmental authority had carried out independent investigations and it was discovered that the mine needed critical improvements in its operations to stop the acid mists and other mining activities that were allegedly affecting the environment and the residents' health.
Labels: ENVIRONMENT, GUY SCOTT, MCM, MOPANI, POLLUTION
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MUZ challenges Mopani to end leaching mine Pollution
By Misheck Wangwe in Kitwe and Gift Chanda in Lusaka
Fri 09 Mar. 2012, 11:59 CAT
MUZ has challenged Mopani Copper Mines to end pollution at Mufulira West
Heap Leaching Mine and save jobs instead of disputing the findings of the environmental authority.
And Mopani Copper Mine's shareholders have ordered the company management to urgently meet officials from the Zambia Environmental Management Agency (ZEMA) to address pollution challenges that led to the closure of its treatment plant in Mufulira.
Last Thursday, ZEMA ordered Mopani Copper Mine, a unit of leading swiss global commodity trader Glencore International AG, to suspend operations at its Mufulira West Heap Leaching plant for pollution violations.
In an interview yesterday, Mineworkers Union of Zambia (MUZ) general secretary Nkole Chishimba said the defensive position that Mopani had taken over the closed Heap Leaching mine would not compel ZEMA to reopen the plant as the environmental authority had indicated that that would only happen when measures were taken to end the strong acid mists the plant was producing.
He said Mopani should urgently begin to redesign the plant and invest in equipment that would stop the acid mists from polluting Butondo Township in line with ZEMA's recommendations.
Chishimba said Mopani management must protect the 310 jobs created by the Mufulira West Heap Leaching plant by working towards improving its operations to the satisfaction of both the community and the environmental authority.
"We want that mine to reopen because our people need those jobs so workers should not be laid but they are supposed to put them on recess. There is a provision to put workers on recess like it happened in Luanshya when they were redoing the winders at Baluba Mine. They did not fire workers because they realised that it was not a permanent closure. So they should follow the provisions of the recess," Chishimba said.
He said matters of environmental concerns, particularly the allegations of massive pollution of the acid mists the heap leach plant was producing should have been addressed as Butondo residents had been complaining for a long time.
Chishimba said Mopani had the capacity to end pollution, save jobs and protect its operations at Mufulira West Heap Leaching Mine.
But Mopani Copper Mines chief executive officer Danny Callow said the company was surprised at the action taken by ZEMA and expressed fears for the 310 jobs created by the project.
In a statement, Callow said every day of the suspension was costing the company in the region of K525 million and called into question whether Mopani could continue to support the jobs created by the Heap Leach Project.
"Whilst the imminent closure notice appears to have been a precautionary measure on the part of ZEMA, we are not sure where they are getting their information from... We have always conducted our heap leaching project in a responsible manner and in line with or exceeding the terms of license," Callow said.
And according to sources at the mine, management has requested for an audience with ZEMA officials with a view of lifting the suspension of operations at its Mufulira West Heap Leaching plant.
"It seems instructions came from Switzerland where majority shareholders Glencore AG are based, that management should seek audience with ZEMA instead of issuing press statements that are dismissing the findings of the Agency," said the sources.
Last week, ZEMA suspended operations Mopani's Mufurila West Heap Leaching plant over pollution violations.
ZEMA stated that it had inspected the site and that heap leaching - a process that involves metals being leached from a heap of crushed ore by applying acid to the soil-couldn't be resumed until the company had completed eight recommended measures to reduce its effect on the surrounding area.
However, Mopani refuted the findings saying it was "surprised" by the suspension of a part of its mines, particularly since the ZEMA had renewed its operating license recently.
"Mopani's heap leach project has been operating since 2007. It has been properly and closely monitored by the relevant authorities and has always been given a clean bill of health, meeting or exceeding the terms of its license," stated Callow.
Labels: MCM, MOPANI, MUZ, POLLUTION
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MCM plant closure warning to investors, says Matale
By Gift Chanda
Wed 07 Mar. 2012, 11:59 CAT
THE closure of Mopani Copper Mine's treatment plant in Mufurila is a warning to mine investors to invest heavily in environmental protection, says Reverend Suzanne Matale. And Mopani Copper Mine says it was surprised at the action by ZEMA and may be forced to lay off staff following the closure.
Last Thursday, the Zambian Environmental Management Agency (ZEMA) ordered Mopani Copper Mine, a unit of leading global commodity trader Glencore International PLC, to suspend operations at its Mufurila West Heap Leaching plant for pollution violations.
"The Council of Churches in Zambia commends the decision by ZEMA to close down the Mopani Copper Mines acid plant situated at Butondo in Mufulira district," Rev Matale said on the development.
"We hope this action will send a strong message to other mine investors to ensure that they invest heavily to protect the environment and people."
She said the action to suspend operations at the plant had been long overdue, adding that human life and the environment had been negatively affected.
"While the acid plant has been closed, the effects of the emissions on people and the environment remain. Skin bleaches, increased respiratory complaints, leached rooftops, and other effects are still with the community. Our question is: whose responsibility is it to compensate the affected individuals and households? CCZ recommends that ZEMA takes MCM to court so that it is made to account for this irresponsible act," said Rev Matale.
But Mopani Copper Mines said it was surprised at the action by the environmental agency and may be forced to lay off staff following the closure.
"ZEMA has closely and properly monitored the Heap Leach project since the project's inception in 2007 and always found the operations to be in compliance with ZEMA regulations," company's chief executive officer Danny Callow said in a statement.
"It is unclear how data from ZEMA's investigations could differ from the previous five years' satisfactory results, evidenced by the continuation by ZEMA of issuing operating licences, including for 2012."
He said Mopani had not been furnished with findings from ZEMA's investigations adding that the shutdown of the plant may affect 300 jobs and 1.5 per cent of Mopani's annual copper production capacity.
"Every day of suspension is costing the company in the region of 525 million kwacha and unfortunately calls into question whether Mopani can continue to support 310 jobs created by the heap leach project," Callow said.
"Whilst the imminent closure notice appears to have been a precautionary measure on the part of ZEMA, we are not sure where they are getting their information from... . We have always conducted our heap leaching project in a responsible manner and in line with or exceeding the terms of our licence."
Mopani's parent company, Glencore, has been accused by non-governmental organisations of tax evasion and widespread pollution, although it has denied the accusation.
The European Investment Bank mid-last year froze all new loans to Glencore and its subsidiary, citing "serious concerns" over the group's corporate governance.
Labels: FDI, MCM, POLLUTION, SUZANNE MATALE
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COMMENT - This is an excellent development. Mopani should be prosecuted for criminal actions. If the MMD refuses to do it's duties (or a PF-UPND would take the same attitude), not only should all donor aid be suspended, but there should be international criminal charges of fraud and embezzlement against the MMD leadership.
Mopani is dodging taxes - CSOs
By Chiwoyu Sinyangwe
Thu 10 Feb. 2011, 04:00 CAT
MOPANI Copper Mines (MCM) is dodging taxes in Zambia, says a consortium of European-based and local civil society organisations.
And
the organisations have questioned finance minister Dr Situmbeko Musokotwane’s continued silence on the audit report given to him last year which revealed the glaring irregularities in production and revenue figures at Mopani.A pilot audit which covered activities of the mine from 2006 to 2008, conducted by tax specialists Grant Thornton and Econ Pöyry of Nordic region, revealed glaring inconsistencies in production and revenue figures Mopani submits to the Zambia Revenue Authority (ZRA) for tax administration, the numbers the report said might not be "trustworthy."
The irregularities at Mopani hinge on its relationship with its parent company, Glecore AG, of Switzerland and cover practices such as alleged transfer pricing, inflated operation costs, outright under-pricing of copper for exports and irregular hedging practices.
Commenting on the revelations which also observed that the government lacked capacity to verify figures submitted by mining firms to ZRA, the civil society organisations called for immediate recovery of all lost tax revenue, with interest, from Mopani and other mining companies who might be found wanting by the ongoing audits.
The organisation which comprised Oxfam, Counter Balance, Eurodad, Tax Justice Network and Centre for Trade Policy and Development (CTPD) stated that additional fines should be imposed on mines not cooperating with government’s audit efforts.
“Mopani Copper Mines, a Swiss-owned mining company, funded with EU development monies, is siphoning its profits out of Zambia without paying taxes. Instead, it is putting the money into a tax haven, Switzerland. Mopani Copper Mines is dodging taxes in Zambia,” the organisations stated.
The organizations also questioned Dr Musokotwane’s inertia to act despite being given the report last year in which auditors expressed frustrations in carrying out the exercise which was within provisions of Zambia laws.
“The auditors found that MCM resisted the pilot audit at every stage. The company’s book-keeping was incomplete, several legally required documents were lacking and the general ledger analysis showed several loopholes and couldn’t be matched with the trial balance,” the organisations stated.
“The auditors also found an inexplicable doubling in the costs of the company between 2005 to 2007, which shows that the company has been artificially inflating its costs to minimise the profits shown in their books so that they could pay less taxes. Despite the fact that the audit was finished in the fall of 2009, it was kept secret.”
The organisations also called for implementation of all recommendations contained in the audit report to be applicable to all mining companies.
“A complete reform of the mining tax regime to enable ZRA enforce simple and easy to implement taxation system,” demanded the organisations.
“The donor community should support Zambia to increase ZRA’s capacity to undertake financial audits and undertake a fresh tax assessment for all mining companies.”
And Centre for Trade Policy and Development (CTPD) executive director Savior Mwambwa said the audit confirms fears that mining companies were depriving the Zambian people social and economic benefits that were rightly theirs through tax evasion and avoidance practices.
Mwambwa said the country’s revenue collection from the mining sector should pre-occupy the people of Zambia and politicians in this year's election campaigns.
“This is a wake-up call to the government of Zambia to undertake an industry-wide financial audit of all mining companies for the purposes of the Zambian Revenue Authority updating its tax assessment for mining companies,” said Mwambwa. “Mopani should be penalised by heavy fines plus tax payments with interest, failure to which its operating licence should be suspended.”
Mopani which operates mining units in Kitwe and Mufulira is 73.1 per cent owned by the Swiss commodity trader, Glencore AG, and the firm received a 48 euros million loan from the European Investment Bank.
Labels: CORRUPTION, CSO, GLENCORE INTERNATIONAL AG, MCM, MOPANI, SITUMBEKO MUSOKOTWANE, TAX EVASION
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COMMENT - Massive tax evasion going on at Mopani. I quote: " The audit revealed that
Glencore AG, the purchaser, determines prices and that some copper from Mopani is sold under an “old” contract with
copper in one instance being sold at 25 per cent of official prices at LME. " In other words, they are not paying taxes over 75% of the copper 'sold' to Glencore under that contract. (UPDATED Feb 13th 2011)
The full Mopani audit report is here. Also see the summary to the Pilot Audit of Mopani Mine in the comments below from Friends Of The Earth. (Update Thursday 10 Feb) Also see:
Govt accused of secret dealings with mine owners Thursday, February 10, 2011, 8:48
On Glencore International - it is operated by old Bill Clinton friend
Marc Rich, who has also been
convicted for tax evasion in the US, as well as for trading with Iran. He was pardoned by President Bill Clinton. Rich's legal representation was
Lewis 'Scooter' Libby, who himself barely escaped prison after a conviction for his role in outing CIA agent Valerie Plame Wilson. (More on Marc Rich
on Youtube.) At one point rich was on the FBI's Most Wanted list, for "trading with embargoed states,
tax evasion, racketeering and arms trafficking" (quoting Keith Harmon Snow's
article Merchants Of Death). I would say the mines are better off in the hands of the state, with a proper legal framework in place.
Mopani pilot audit reveals tax payment irregularities
By Chiwoyu Sinyangwe
Wed 09 Feb. 2011, 04:01 CAT
A PILOT audit has revealed glaring irregularities and inconsistency in production and revenue figures that Mopani Copper Mines submit to ZRA for tax administration, most of which hinge on its links to
Glencore AG.And revelations of the audit sanctioned by the government with the aid of some cooperating partners have stated that Zambia lacks enough capacity to verify records submitted by mining firms to Zambia Revenue Authority (ZRA) for tax administration.
It stated that the taxes being paid by mining firms in the country were not consistent with production volumes and the revenues from copper sales.
According to an audit conducted by lead auditors -
Grant Thornton Zambia - and
Econ Pöyry, a Nordic based global consulting and engineering company, there was clear indications from the comparative analyses that
there were major problems with both revenues and costs of Mopani Copper mines.
The focal point of the review was to audit a significant and representative part of the mining industry and to cover significant problems during initial phase of changing the Zambian fiscal system in 2008 and 2009 periods.
The audit revealed that most of irregularities were embedded in transfer pricing in revenues owing to Mopani's links with Glencore AG, which owns 73 per cent of the mining units based in Kitwe and Mufulira.
Most of the overall production is sold to Glencore based on the “Copper Marketing and Off-take Agreement” signed in the year 2000 which entitles Glencore UK a commission of two per cent calculated at the gross value FOB port landing.
“...we believe that the related party sales and pricing mechanisms are not in accordance with the agreement disclosed, or arms length principle,” the audit report stated. “This should have impact on the tax assessment for the period under review.”
The audit revealed that Glencore AG, the purchaser, determines prices and that some copper from Mopani is sold under an “old” contract with copper in one instance being sold at 25 per cent of official prices at LME.
“The agreement is entered into with Glencore UK Limited, but the actual sale transactions disclosed are, as far as we have been able to verify with Glencore International AG,” the audit revealed.
“The agreement mentioned is in fact an agent agreement, stating that Glencore is to operate as sole sales and marketing agent for Mopani. The sales are to be made at official LME London Metal Exchange copper grade settlement quotation averaged over the relevant quotation period plus premium or less a discount realisation charge for freight.”
The audit revealed that despite Mopani selling copper grade +1 in consistency with LME prices, Glencore has consistently bought copper at prices below the market value.
The audit team accused Mopani of being hostile towards the audit which was postponed from initial February 2009 to October 2009 and most audit queries went unanswered despite the exercise being undertaken in accordance with the ZRA Act.
“The audit team has not enough information to dissect the full production cycle of copper from Mopani with the current data,” the audit report stated. “Mopani has used every opportunity available to hamper the progress of the audit and the audit team are at the moment not able to fully conclude whether the copper production from Mopani is trustyworthy or not.”
The audit report which doubted ZRA's capacity to verify records for taxation submitted by Mopani stated that there was general indication of inflated operations costs at the mine.
During the period of the audit, the labour cost for Mopani was estimated at US $50 million against the “unexplainable figure US $90 million".
"One explanation could be that costs that should have been capitalised have been taken as expense,” the audit stated.
“Glencore is charging freight charges (realisation charges) based on fixed fees for deliveries CIF Rotherdam, even though the actual shipments were made to other ports, often closer to Copperbelt."
The scope of the audit report which was submitted to finance minister Dr Situmbeko Musokotwane about September 2010, involved taking a full review of operational costs, revenues, transfer pricing, employees' expenses and overheads on Mopani operations in Kitwe and Mufulira.
And the audit revealed that there was no collaboration between ZRA and the Ministry of Mines to monitor the production and revenue figures submitted by the mines as evidenced by the pilot audit on Mopani which revealed inconsistency in production figures submitted to government and those in the company's books of accounts.
“The pilot audit has shown that there is great need for determined effort at collecting the taxes that are assessed under the laws implemented by Zambian parliament,” stated the audit.
“ZRA needs the Ministry of Mines to follow up production volumes from ore treated via produced volumes to sold metals on a more consistent and comprehensive basis in order for the calculation of the royalty to be reliable."
I'm trying to be as precise as I can, but the trail again seems to lead to Marc Rich to one of the Rothschild clan, Nathaniel Rothschild, son Baron Jacob Rothschild.
According to Investigate.co.uk, Xstrata financial adviser is none other than financier Nathaniel Rothschild, son of Lord Jacob Rothschild, and Marc Rich compatriot in Switzerland. (See also this Reuters article.)
Here Nathaniel Rothschild waxes lyrically on the prosects and the business culture of Marc Rich's Glencore.
NM Rothschild (previously headed by Evelyn de Rothschild, now David de Rothchild) also financed the BSAC of Cecil John Rhodes in the 1880s, and the privatisation of the Zambian mining industry through the privatisation of state monopoly ZCCM, in the 1990s.
So much for 'free markets' and privatisation. All privatisation represents, is a return to colonialism under another name. The money still disappears from the country. - MrK
Labels: CORRUPTION, GLENCORE INTERNATIONAL AG, MCM, MOPANI, TAX EVASION
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Kitwe’s Cha Cha Cha locals resolve not to pay land rates
By a Correspondent
Sun 21 Feb. 2010, 04:00 CAT
RESIDENTS of Kitwe’s Cha Cha Cha township have resolved not to pay land rates to Kitwe City Council
following the development of an open-pit mine close to their houses by
Mopani Copper Mines (MCM) without addressing their concerns.
But Kitwe council public relations officer Dorothy Sampa said the residents’ resolution was unfortunate considering that so many consultative meetings had been held between ECZ and the residents to resolve the issue relating to the open-pit mine.
According to a letter signed by 120 Cha Cha Cha residents and addressed to Kitwe Town Clerk Ali Simwinga dated January 26, 2010 and copied to among others, minister environment, Minister of Mines, Copperbelt minister, Environmental Council of Zambia (ECZ) and Kitwe district commissioner MacDonald Mtine, there was no transparency involving the development of the mine.
The residents said their cries and concerns had completely been ignored since MCM had been allowed to start an open pit mine behind their houses without giving due consideration to the environmental consequences and hazards which would affect the residents and the environment.
The residents said following a meeting between, ECZ, MCM, Cha Cha Cha residents and the council, ECZ was mandated to meet their demands, which included production of the public hearing report concerning the open-pit mine, re-measuring the distance between residential houses and the open-pit mine to the acceptable standards and production of the ECZ manager’s press report as part of the Environment Impact Assessment Compliance.
“Amid all these uncertainties and failures to address our concerns with the seriousness they deserve, we Cha Cha Cha residents, have resolved to demand that MCM Plc shift us from Cha Cha Cha Township to a safe place where our safety can be guaranteed. Failure to comply with our first demand, we have vowed not to pay land rates to the KCC,” read the letter.
The residents vowed to see President Rupiah Banda over the matter.
But Sampa said the pertinent issues which the residents raised had been addressed by the ECZ before it granted authority to MCM to proceed with the development of the open pit mine.
“If, however, the residents feel that these issues still remain unresolved, there are channels of appealing to the Minister of Environment and Natural Resources, but certainly the stopping payments of rates is not one of the channels of appeal because rates are taxes on properties in order to meet services of public nature like cemeteries, street lighting and others,” said Sampa.
“My appeal to the residents of Cha Cha Cha is that while they may have a good cause, they should not take the law into their own hands. I do wish to state that failure to pay rates by any rate payer may result into a serious matter and may compel the council to send bailiffs which would be regrettable, but unavoidable.”
Labels: ENVIRONMENT, KITWE, LAND RATES, MACDONALD MTINE, MCM, MINING, POLLUTION
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ZRA begins audit of mining operations
By Chiwoyu Sinyangwe
Thu 29 Oct. 2009, 04:00 CAT of the global financial crisis which hurt economic activity.
REVENUE earnings for the country were below target by K574 billion during the first eight months of this year to K7 trillion on the backdrop of effects
And Zambia Revenue Authority (ZRA) has started auditing Konkola Copper Mines (KCM), Kansanshi Copper Mines and Mopani Copper Mines (MCM) to verify their books of accounts for administering the variable profit tax.
During the period under review, ZRA was targeting to collect net taxes of K7.6 trillion but collected only slightly above K7 trillion.
Gross taxes were recorded at K8. 7 trillion while the refunds stood at K1.6 trillion.
“This outturn was largely on account of poor performance of trade taxes,” ZRA commissioner for domestic taxes Wisdom Nhekairo told journalists during a press briefing yesterday.
“The lower than projected revenue collection in trade taxes is largely attributed to the rapid depreciation of the kwacha against major currencies during the earlier part of the year making the cost of importation almost prohibitive, and the slowdown in economic activities in the country on the backdrop of world financial crisis. As a result, the levels of imports coming into the country drastically reduced during this period compared to the same period last year.”
He said ZRA undertook measures that increased audits of the taxpayers’accounts in different sectors of the economy in a quest to mitigate the impact of the secondary effects of the global financial crisis which mainly hurt the trade taxes.
“These audits enable us to improve revenue collections from inland taxes, a situation that we believe is more dependable and sustainable for the country,” he said. “We also increased our debt collection efforts in a bid to mitigate the impact of crises on public revenues.”
And Nhekairo said ZRA had started auditing a composition of both low and high cost mining operations to determine how the projects were differently affected by the international copper price.
He said following the abolishment of the windfall tax and introduction of the variable profit tax, ZRA needed to audit the mines as a way of verifying their tax books of accounts as well as raising the capacity of the country’s revenue body.
ZRA’s pilot audit of the mining companies which started last February with the help of Norway was expected to end next month.
“This mining tax audit is indeed for the new mining tax regime introduced this year after the government amended the mining regime of last year,” said Nhekairo.
During the months under review, mining company taxes based on provision payments were below target by K13.2 billion having recorded an outturn of K212.1 billion against a target of K225.3. And mineral royalty revenue collections were above target by K59.3 billion having registered an outturn of K167.4 billion against a target of K114.5 billion.
Labels: AUDITING, MCM, ZRA
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‘Compel mines to give locals contracts’
Written by Kabanda Chulu
Tuesday, August 11, 2009 5:51:35 PM
MINE Suppliers and Contractors Association chairperson Fanuel Banda has advised the government to create policies that will compel mining companies to deliberately offer contracts to local suppliers.
Commenting on the increasing levels of inside trading and lack of transparency in the procurement services for the mining industry, Banda said foreign suppliers would not add value to the Zambian economy.
“Our understanding is that the business of trading should be done by Zambians unless where they fail but even then partnerships should be encouraged to be established so that there is that linkage. And government must create policies to compel the mines to offer contracts to local people because they prefer those who come from their countries,” Banda said.
“Also there is no transparency and inside trading is too rampant when supplying the mines. For instance, Mopani Copper Mines (MCM) spends an average of US $ 20 million per month on procurement but these funds always get back to their respective countries, so the mines should be compelled to pass through benefits to local people supplying the mines.”
To address the issue of inside trading and lack of transparency, Mopani Copper Mines in 2007 introduced the Quadrem System, which is a kind of online procurement system, but many local suppliers misunderstood the concept and resisted it, saying it would favour foreign suppliers.
The local suppliers petitioned late president Levy Mwanawasa that the Quadrem system would disadvantage local suppliers. Consequently, it was removed hence is no longer in place.
Labels: CONTRACTORS, FANUEL BANDA, MCM, MINING, MINING CONTRACTS, MSCA, PROCUREMENT SYSTEMS, QUADREM
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COMMENT - Why do even the unions keep asking for jobs to be maintained? Isn't it clear that the dogmatic and ideological decision to privatise the mines has failed, and that this is no way to run an economy? The miners should not be asking for jobs - they should be taking over the mines, and the government must help them doing so. They can get them on so many things - violation of environmental and labour laws, and not last, on tax evasion (look who didn't pay the windfall tax and get them on that). It is a chance for the MMD to show they are not corrupt, and stand with their own citizens. Also, mining is a very inefficient way to create jobs - agriculture can create 10 x more jobs with 1/10th of the investment - which is why money should be poured from mining into agriculture, infrastructure and manufacturing.
Govt has failed to protect jobs for miners – Mukanga
Written by Chibaula Silwamba, Kabanda Chulu and Mutuna Chanda
Friday, May 08, 2009 4:39:50 PM
THE government has failed to protect jobs for the miners despite assurances, Kantanshi member of parliament Yamfwa Mukanga has charged. And Patriotic Front (PF) chairperson for labour Davies Mwila has said there is no justification for Mopani Copper Mines (MCM) to retrench workers when copper prices have started increasing on the international markets.
In an interview on Tuesday, Mukanga, whose constituents in Mufulira town have been hard hit by retrenchments of MCM, said people were desperate because they had no means of survival.
"[Labour minister Austin] Liato had lied that no company had notified the government that it will retrench workers but now people are losing their jobs at Mopani Copper Mines and this has shown that the government doesn't care about these people. People have no jobs while the government is watching from the terraces. That is not good, the government was supposed to get involved to ensure that our people are protected," Mukanga said.
"The President used to assure us. Even the ministers were assuring us but people are still losing jobs. A lot of people have been affected by the lay-offs by Mopani Copper Mines. So many people have lost their jobs at Mopani but the government has kept quiet. Government was supposed to protect them."
Mukanga urged the government to seriously look into the frequent retrenchments of the miners and come up with measures that would mitigate the sufferings of the people in Copperbelt Province.
And commenting on the decision by MCM to retrench 978 miners at both Nkana and Mufulira mines, Mwila said in Lusaka that President Rupiah Banda's government must be blamed for failing to protect its own citizens.
"There is no control from this government and investors are doing things on their own. Just recently, President Banda's ministers assured that there will be no job losses but this is contrary to what they said," Mwila said.
"When copper prices dropped, investors used that as an excuse to lay off workers but there is no justification by Mopani to prune workers since prices on the international market have started rising [US$ 4,600 per tonne] and their production costs are well below what they are selling these commodities."
On Lusaka economist Chibamba Kanyama's suggestion that redundancy packages should be revised to reflect investor challenges, Mwila said Kanyama was part of management and should not be taken seriously.
"Zambia Federation of Employers has been advocating that retrenchment package of two months salary for a year served is too much and Kanyama is also supporting that view, but what is that package when someone has just worked for five years because it comes to between K15 million to K20 million that will also be taken by banks since most loans are salary based," said Mwila.
"There is no need to review the Act on redundancy packages because workers are getting peanuts in fact it must be increased upwards to avoid workers becoming destitute."
United Party for National Development (UPND) national youth chairperson Joe Kalusa said mining investors in the country were playing the drums while the MMD government was just dancing.
Kalusa challenged labour deputy minister Simon Kachimba to disclose the deal he allegedly struck with the mines.
"The retrenchments at Mopani are not genuine since expatriates have not been affected and last week Kachimba said there will be no job losses but since people have been retrenched he should tell us what deal he struck with the mines for him to make that announcement," Kalusa said.
"Copper prices are still high but the MMD government has no control and they are playing double standards, it is like investors are playing drums and this government is just dancing instead of taking charge."
And Mineworkers Union of Zambia (MUZ) general secretary Oswell Munyenyembe blamed government for its sluggish approach in dealing with job losses in the mining industry.
Munyenyembe said the problem was with government because it was not eager to meet trade unions in the mining sector over the plight of workers in the industry.
"... We have been pressing to meet them particularly the President [Rupiah Banda] to give them the actual issues on the ground but they have not been forthcoming," Munyenyembe said.
"What is more confusing is that the minister of mines and the minister of labour are saying that they were not informed of the latest job losses at Mopani. Government is confusing its citizens."
He expressed disappointment with Mopani over the retrenchments arguing that the lay offs were not justified at the current copper prices.
"At the current copper prices we don't expect Mopani to be offloading those numbers," said Munyenyembe. "The recession is just an excuse."
National Union of Miners and Allied Workers (NUMAW) president Mundia Sikufele said it was difficult to trust the promises of a stop to job losses in the mining industry.
Sikufele said it was sad that miners were losing jobs.
"Companies and government will say one thing today and what happens after is different," said Sikufele. "I'm hoping that this is the last retrenchment."
National Energy Sector and Allied Workers Union (NESAWU) general secretary Yotam Mtayachalo urged mining companies in agreement with unions and workers to sacrifice certain conditions and benefits as an interim measure to save jobs.
"When times are hard, it pays to make tough and unpopular decisions which will be beneficial in future and this demands unity among the workers and leaders. The auto mobile workers in America have made such bold decisions to protect jobs of their members. It is better to be in employment than get meagre redundancy packages and offloaded in the streets," he stated.
Mtayachalo also called on Mopani to rescind its decision to retrench union branch leaders.
Kankoyo PF member of parliament Percy Chanda suggested that the retrenched miners could engage in small scale copper mining in the slug dumps and sell the products to Mopani.
He urged government to facilitate the practice by engaging Mopani to enable the retrenched miners to continue with their livelihoods.
He said while other retrenched miners in other areas could engage in farming, it was not possible for those who were retrenched in Kankoyo area because the soil was contaminated as a result of the emissions of sulphur dioxide.
On Monday, MCM retrenched at least 978 workers of whom over 500 are from Nkana in Kitwe and over 400 from Mufulira to ensure the survival of the mine.
The sources indicated that the mining firm had also closed some of its departments that included industrial engineering and In Situ at Nkana in Kitwe.
Labels: DAVIES MWILA, JOBLOSSES, JOE KALUSA, MCM, MUNDIA SIFUKELE, NEOLIBERALISM, OSWELL MUNYENYEMBE, YAMFWA MUKANGA, YOTAM MTAYACHALO
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Strong leadership is needed
Written by Editor
On Monday, Mopani Copper Mines retrenched 978 workers – over 500 in Kitwe and over 400 in Mufulira. These retrenchments should not be seen as mere quantitative issues but as a qualitative result of the irrational and unjust nature of the existing system of economic policies. Unemployment, lack of opportunity, insecurity, hopelessness are the terms that could well define the living conditions of a great part of the people of this country.
This should be an affront to our collective conscience. It is an imperative need of our time to be aware of these realities, because of what a situation affecting the great majority of our people entails in terms of human suffering and the squandering of life and intelligence.
The cold eloquence of these figures is in itself terrifying enough. But beyond them lies the tragic situation of the effects of unemployment that is individualised a thousand times over.
Haggai Chishimba, who was retrenched from Mopani Copper Mines on Monday, says he doesn’t know what to do: “Why should the government contradict itself? Today it says it’s going to stop pruning and the next day the investor does something else. I don’t know what to do next because the Copperbelt depends on the copper mines. We have got loans with Barclays and Barclays is getting everything.”
O’brien Musenge who was retrenched while on shift says “workers should be given time to prepare their exit other than an immediate effect pruning”.
A culture which recognises the eminent dignity of the worker will emphasise the subjective dimension of work. The value of any human work does not depend on the kind of work done; it is based on the fact that one who does it is a person. There we have an ethical criterion whose implications cannot be overlooked.
Thus every person has a right to work, and this right must be recognised in a practical way by an effective commitment to solving the tragic problem of unemployment. The fact that unemployment keeps large sectors of our population, and notably the young, in a situation of marginalisation is intolerable. For this reason, the creation of jobs is a primary social task facing individuals and private enterprise, as well as the government. As a general rule, in this as in other matters, the government has a subsidiary function; but often it can be called upon to intervene directly.
The priority of work over capital places an obligation in justice upon employers to consider the welfare of workers before the increase of profits. They have a moral obligation not to keep capital unproductive and in making investments to think first of the common good. The latter requires a prior effort to consolidate jobs or to create new ones. The right to private property is inconceivable without responsibilities to the common good. It is subordinated to the higher principle which states that goods are meant for all.
There is need for solidarity with the workers who are being retrenched on the Copperbelt and elsewhere, and all those whose jobs are threatened. Solidarity is a direct requirement of human and supernatural brotherhood. The serious socioeconomic problems that our country is facing today cannot be solved unless new fronts of solidarity are created: solidarity of the poor among themselves, solidarity with the poor to which the rich are called, solidarity among the workers, and with the workers. Institutions and social organisations at all levels, as well as the government, must share in a general movement of solidarity. And when we appeal for such solidarity, we are aware that we ourselves are concerned in a quite special way.
The gravity of the current challenges demand strong leadership from key players in our economy and the responses we seek should not only be about “the here and now” but should be geared towards shaping the future we all seek to build – a more just, fair and humane Zambia.
It cannot be denied that we are today caught in the global financial crisis, although initially our Minister of Finance Situmbeko Musokotwane had assured that Zambia will not be affected by this crisis.
The current global economic crisis started as a financial problem in the developed countries. But due to globalisation and the disproportional economic power relations, the impact of the financial crisis in the United States and Europe spread to the rest of the world and we are today affected by it.
Bold steps need to be taken to find sustainable responses to the global challenges, most of which are not of our making. We need to develop sector specific strategies and concrete action plans to respond to this global economic meltdown. We have to realise that the effects of this crisis differ from country to country.
For us, this economic crisis just compounded the negative effects of the food and fuel crisis that manifested itself earlier in 2008.
With limited resources, this crisis just puts more pressure on our people to tighten our belts in ensuring that the poor and the vulnerable do not end up absolving the shocks of this economic crisis alone.
We now desperately need a better strategy to mitigate contagion from the global financial crisis and its adverse impact on the real economy of our country.
The thrust of our response framework should revolve around strategies to cushion the impact of the crisis on job losses, particularly for the poor and vulnerable. The vicious cycle of this impact on investment – both private and public – on jobs and on government’s social programmes is what our response framework should seek to offset. This calls for an intensive strategy to target sectors that are vulnerable to the current economic crisis.
We therefore need to ensure that the negative impact of the slowdown on the poor and the most vulnerable is mitigated. The measures we seek to put in place should embrace elements that promote economic growth and sustainable businesses, assist and protect workers and the vulnerable and assist our country meet its developmental objectives.
We need social solidarity among and between all Zambians to ensure that the crisis does not damage the fabric of our society. Those with greater means have a responsibility to those without such means. Our collective responsibility should be to work together to withstand the crisis and ensure that the poor and the most vulnerable are protected as far as possible from its impact. We must also ensure that the economy is ready to take advantage of the next upturn and that the benefits of such growth are shared by all our people.
But as Mopani Copper Mines retrenchee Chishimba has correctly observed, our government leaders have been contradicting themselves from the very beginning on these issues. They started with a denial that Zambia will not be affected by this crisis. They still live in denial. They are every day contradicting themselves on the impact and effects of this crisis. It’s time they came to terms with this situation and its realities. As we have stated before, no problem has ever been solved until it has become a tangible reality which everyone is aware of. Our leaders seem to be at sea and their own discernible preoccupation right now is involvement in corrupt procurement deals.
We shouldn’t cheat ourselves that this struggle is going to be an easy one; it is going to be a lot more complex one than all the others our country has waged and as such demands much more subtle grasp of strategy and tactical awareness. And we are not seeing any of this from our political leaders, especially from President Rupiah Banda himself. All that Rupiah is doing is to engage in endless ceremonial activities and merriment as if he is a titular head of state and not an executive president.
It is said that progress and success is but given to those who continue to win it back through struggle. Mobilise and organise all those around you to play a role in saving jobs and preparing to participate in the efforts to create decent work.
Labels: JOBLOSSES, MCM, MINING, MOPANI
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Mopani retrenches 978 workers
Written by Mutuna Chanda in Kitwe and Chiwoyu Sinyangwe in Lusaka
Tuesday, May 05, 2009 11:00:45 PM
MOPANI Copper Mines (MCM) has retrenched 978 workers. And Zain Zambia Plc is expected to discharge some workers as the country's leading mobile phone company restructures operations in line with its parent company, Zain Group which is streamlining global operations to reach growth targets by 2011.
Sources told The Post that MCM on Monday laid off over 500 workers in Kitwe and over 400 in Mufulira. The sources indicated that the mining firm had also closed some of its departments that included industrial engineering and In Situ at Nkana in Kitwe.
And one of the retrenched Mopani workers, Haggai Chishimba, who spoke in disbelief, said he did not know what to do.
"Why should the government contradict itself?" asked Chishimba. "Today it says it's going to stop pruning and the next day the investor does something else."
Chishimba, who was in the company of fellow MCM retrenchees, said the government knew beforehand that workers would be retrenched going by mines minister Maxwell Mwale's silence.
"I don't know what to do next because the Copperbelt depends on the mines. We've got loans with Barclays and Barclays is getting everything," Chishimba said.
Another retrenched miner O'Brien Musenge, who was retrenched while he was on shift, said the workers should have been given time to prepare their exit other than an immediate-effect-pruning.
Lawrence Banda, complained that the retrenchment package was too little as it was K7 million less than those of his peers who were retrenched in February.
And according to letters handed to some of the miners signed by Mopani chief processing officer T. Gonzales and dated April 30, 2009, the mining company pruned workers it considered excess labour.
"Following reorganisation and labour rationalisation at Mopani Copper Mines Plc, you have been identified as excess to the labour requirement in your department," stated Gonzales. "Therefore, we wish to advise that your employment with this company has been terminated. Accordingly, your last shift will be 4th May, 2009, on which date all employment obligations shall cease. You will be paid terminal benefits for your service as follows: i) two months' pay for each completed year of service pro rata. ii) repatriation allowance in accordance with conditions of employment and service. iii) one month's pay in lieu of notice. iv) your accrued MCM (Mopani Copper Mines) pension in accordance with pension rules. v) long service award if you have completed nine or 19 or 29 years of continuous service. We would like to take this opportunity to thank you for the service you have rendered and wish you success in your future endeavours."
Efforts to reach Mopani officials failed as mobile phones for both chief executive officer Emmanuel Mutati and chief services officer Passmore Hamukoma went unanswered.
And Patriotic Front (PF) Mufulira district vice-chairperson Francis Mumba expressed particular concern at the retrenchment of medical personnel at the Mopani-run Malcom Watson Hospital.
"Why retrench medical personnel when we have a big shortage of medical personnel in the country?" he wondered.
Mumba said people on the Copperbelt were tired of retrenchments.
"These investors are running this country and not the government. Today the investors say they have rescinded the decision and will not fire workers and then they turn around and say they will fire workers," Mumba said. "Government should put its foot down and say enough is enough."
Last week, MCM rescinded its decision to close its Mufulira operation and place its shafts in Kitwe under care and maintenance.
The company was considering closing some operations and place some under care and maintenance owing to the fall in world copper prices from highs of close to US $9,000 per tonne early to mid last year to around US $3,000 per tonne later in the same year.
Following the Mopani announcement last week, labour deputy minister Simon Kachimba indicated that there would be some "minor injuries" to the Mopani workforce.
Kachimba after meeting management at Mopani, said that the workforce, which stood at 7,264 would remain in the regions of 7,000.
However, the 978 laid off on Monday bring the labour force at Mopani to 6,286.
And Zain Group will reduce its current 15,500 global workforce by 2,000 across the board.
"The Zain Group will align its head office and operations structures in accordance with the new operating model. This will result in Zain reducing its current 15,500 global workforce by 2,000 [equivalent to a 13 per cent reduction] across the board," disclosed the Group through a statement made available by Zain Zambia Plc public relations officer Kennedy Mambwe in response to a press query from The Post.
The confirmation from the Kuwait headquartered company followed growing anxiety among most Zain Zambia Plc employees who recently feared for their jobs after management recently sent them a memo informing them about the impending job losses which was likely to be implemented by August this year.
It was not immediately clear how many workers would be fired from the Zambian branch and when the restructuring would be implemented.
The statement also disclosed that Zain operations in Iraq, Jordan, Kenya, Kuwait, Malawi and Sierra Leone had already begun the process of reducing employment levels.
The pending countries were Bahrain, Burkina Faso, Chad, Republic of the Congo, the Democratic Republic of the Congo, Gabon, Ghana, Kenya, Madagascar, Niger, Nigeria, Saudi Arabia, Sudan, Tanzania, Uganda and Zambia.
However, there was little indication that the ongoing reforms were triggered by the current global economic crisis.
The statement announced that Zain Group chief executive officer Dr Saad Al Barrak announced a new programme to propel the company towards its 2011 target of being a top ten global mobile telecommunications operator following a strategic meeting with senior Zain executives from all 22 African and Middle East operations.
According to the statement, "Drive2011" would focus on customer facing services and commercial activities while centralising or outsourcing some back office/non-core functions to strategic partners.
"Drive2011 is a natural consequence of Zain's evolutionary journey. It was planned soon after the launch of our ACE strategy in 2007 and is a structured and timetabled approach to maximising efficiency," Dr Al Barrak commented. "We will create genuine market differentiation through our services and deliver on our Zain brand promise of 'a wonderful world'. This will be achieved through a combination of managed outsourcing, centralisation and leveraging capabilities, as well as training and development for our personnel, all of which will improve our operating efficiencies."
The statement further noted that the new strategy, which comes at a vital stage of the company's "3x3x3" vision that commenced in 2003, would maximise economies of scale and realise significant efficiencies, allowing Zain to provide communication services such as voice, SMS [Short Message Service] and data at an optimum cost structure.
"Drive2011 is expected to improve Zain's operating margin by five per cent within 12 months and provide the company the necessary thrust to capture the future growth potential of the markets in which it operates," the statement read in part.
Additionally, the statement also announced during the same meeting, Dr Al Barrak also made several senior management changes both at Group and country operation level, a move aimed at tackling the challenges ahead and attaining other 2011 targets of 150 million customers and a US $6 billion EBITDA.
Most Zain Zambia Plc workers had in recent times been gripped by fear following the recent intimation of the impending retrenchments by management at the company which controls about 78 per cent of the mobile phone sector in the country.
"You can't have a peace of mind when you know that each time you go for work in the morning, you might be given a letter of terminating your contract," said one employee who declined to be named.
Labels: JOBLOSSES, MCM, MOPANI, ZAIN ZAMBIA LIMITED PLC
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Mopani Copper Mines retrenches 978 workers
Written by Mutuna Chanda in Kitwe and Chiwoyu Sinyangwe in Lusaka
Tuesday, May 05, 2009 4:57:25 PM
MOPANI Copper Mines (MCM) has retrenched 978 workers. And Zain Zambia Plc is expected to discharge some workers as the country's leading mobile phone company restructures operations in line with its parent company, Zain Group which is streamlining global operations to reach growth targets by 2011.
Sources told The Post that MCM on Monday laid off over 500 workers in Kitwe and over 400 in Mufulira. The sources indicated that the mining firm had also closed some of its departments that included industrial engineering and In Situ at Nkana in Kitwe.
And one of the retrenched Mopani workers, Haggai Chishimba, who spoke in disbelief, said he did not know what to do.
"Why should the government contradict itself?" asked Chishimba. "Today it says it's going to stop pruning and the next day the investor does something else."
Chishimba, who was in the company of fellow MCM retrenchees, said the government knew beforehand that workers would be retrenched going by mines minister Maxwell Mwale's silence.
"I don't know what to do next because the Copperbelt depends on the mines. We've got loans with Barclays and Barclays is getting everything," Chishimba said.
Another retrenched miner O'Brien Musenge, who was retrenched while he was on shift, said the workers should have been given time to prepare their exit other than an immediate-effect-pruning.
Lawrence Banda, complained that the retrenchment package was too little as it was K7 million less than those of his peers who were retrenched in February.
And according to letters handed to some of the miners signed by Mopani chief processing officer T. Gonzales and dated April 30, 2009, the mining company pruned workers it considered excess labour.
"Following reorganisation and labour rationalisation at Mopani Copper Mines Plc, you have been identified as excess to the labour requirement in your department," stated Gonzales. "Therefore, we wish to advise that your employment with this company has been terminated. Accordingly, your last shift will be 4th May 2009, on which date all employment obligations shall cease. You will be paid terminal benefits for your service as follows: i) two months' pay for each completed year of service pro rata. ii) repatriation allowance in accordance with conditions of employment and service. iii) one month's pay in lieu of notice. iv) your accrued MCM (Mopani Copper Mines) pension in accordance with pension rules. v) long service award if you have completed nine or 19 or 29 years of continuous service. We would like to take this opportunity to thank you for the service you have rendered and wish you success in your future endeavours."
Efforts to reach Mopani officials failed as mobile phones for both chief executive officer Emmanuel Mutati and chief services officer Passmore Hamukoma went unanswered.
And Patriotic Front (PF) Mufulira district vice chairperson Francis Mumba expressed particular concern at the retrenchment of medical personnel at the Mopani-run Malcom Watson Hospital.
"Why retrench medical personnel when we have a big shortage of medical personnel in the country?" he wondered.
Mumba said people on the Copperbelt were tired of retrenchments.
"These investors are running this country and not the government. Today the investors say they have rescinded the decision and will not fire workers and then they turn around and say they will fire workers," Mumba said. "Government should put its foot down and say enough is enough."
Last week, MCM rescinded its decision to close its Mufulira operation and place its shafts in Kitwe under care and maintenance.
The company was considering closing some operations and place some under care and maintenance owing to the fall in world copper prices from highs of close to US $9,000 per tonne early to mid last year to around US $3,000 per tonne later in the same year.
Following the Mopani announcement last week, labour deputy minister Simon Kachimba indicated that there would be some "minor injuries" to the Mopani workforce.
Kachimba said after meeting management at Mopani that the workforce, which stood at 7,264 would remain in the regions of 7,000.
However, the 978 laid off on Monday bring the labour force at Mopani to 6,286.
And Zain Group will reduce its current 15,500 global workforce by 2,000 across the board.
"The Zain Group will align its head office and operations structures in accordance with the new operating model. This will result in Zain reducing its current 15,500 global workforce by 2,000 [equivalent to a 13 per cent reduction] across the board," disclosed the Group through a statement made available by Zain Zambia Plc public relations officer Kennedy Mambwe in response to a press query from The Post.
The confirmation from the Kuwait headquartered company followed growing anxiety among most Zain Zambia Plc employees who recently feared for their jobs after management recently sent them a memo informing them about the impending job losses which was likely to be implemented by August this year.
It was not immediately clear how many workers would be fired from the Zambian branch and when the restructuring would be implemented.
The statement also disclosed that Zain operations in Iraq, Jordan, Kenya, Kuwait, Malawi and Sierra Leone had already begun the process of reducing employment levels.
The pending countries were Bahrain, Burkina Faso, Chad, Republic of the Congo, the Democratic Republic of the Congo, Gabon, Ghana, Kenya, Madagascar, Niger, Nigeria, Saudi Arabia, Sudan, Tanzania, Uganda and Zambia.
However, there was little indication that the ongoing reforms were triggered by the current global economic crisis.
The statement announced that Zain Group chief executive officer Dr Saad Al Barrak announced a new program to propel the company towards its 2011 target of being a top ten global mobile telecommunications operator following a strategic meeting with senior Zain executives from all 22 African and Middle East operations.
According to the statement, "Drive2011" would focus on customer facing services and commercial activities while centralizing or outsourcing some back office/non-core functions to strategic partners.
"Drive2011 is a natural consequence of Zain's evolutionary journey. It was planned soon after the launch of our ACE strategy in 2007 and is a structured and timetabled approach to maximizing efficiency," Dr Al Barrak commented. "We will create genuine market differentiation through our services and deliver on our Zain brand promise of 'a wonderful world'. This will be achieved through a combination of managed outsourcing, centralization and leveraging capabilities, as well as training and development for our personnel, all of which will improve our operating efficiencies."
The statement further noted that the new strategy, which comes at a vital stage of the company's "3x3x3" vision that commenced in 2003, would maximize economies of scale and realize significant efficiencies, allowing Zain to provide communication services such as voice, SMS [Short Message Service] and data at an optimum cost structure.
"Drive2011 is expected to improve Zain's operating margin by five per cent within 12 months and provide the company the necessary thrust to capture the future growth potential of the markets in which it operates," the statement read in part.
Additionally, the statement also announced during the same meeting, Dr Al Barrak also made several senior management changes both at Group and country operation level, a move aimed at tackling the challenges ahead and attaining other 2011 targets of 150 million customers and a US $6 billion EBITDA.
Most Zain Zambia Plc workers had in recent times been gripped by fear following the recent intimation of the impending retrenchments by management at the company which controls about 78 per cent of the mobile phone sector in the country.
"You can't have a peace of mind when you know that each time you go for work in the morning, you might be given a letter of terminating your contract," said one employee who declined to be named.
Labels: JOBLOSSES, MCM, MOPANI, ZAIN ZAMBIA LIMITED PLC
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Mopani to retrench few workers
Written by Mutuna Chanda in Kitwe
Thursday, April 30, 2009 6:14:08 PM
LABOUR deputy minister Simon Kachimba has said Mopani Copper Mines will only retrench a few workers in its continued restructuring programme.
Speaking after meeting Mopani Copper Mine (MCM) management on Wednesday afternoon, Kachimba said the mining firm informed him that there would be minor adjustments to its workforce as most of the staff would be retained.
He said Mopani assured him that its workforce which currently stood at 7,264, would remain in the region of 7,000 after restructuring.
"When restructuring, you might lose two or three chairs but the good thing is that the largest number won't be disturbed," he said.
Kachimba said Mopani told him that it would continue with the operations of the Mufulira mine but under a tight budget.
He commended Mopani for suspending its plans to put its shafts under care and maintenance.
Kachimba also said Mopani's expatriate staff had reduced to 50 from 125 as at April.
Labels: JOBLOSSES, MCM, MOPANI, SIMON KACHIMBA
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Mopani won’t close Muf, Nkana mines
By Times Reporter
MOPANI Copper Mines (MCM) has shelved plans to place Nkana and Mufulira mines under care and maintenance, company secretary, Kyansenga Chitoshi announced in a statement yesterday.
Ms Chitoshi said the decision follows the implementation of the cost reduction programme coupled with slight improvement of copper prices on the international market.
“Following a detailed review of its mining operations, Mopani expects to achieve a significant cost reduction through the implementation of a range of cost containment programmes.
“This, together with a slightly improved copper price environment, has enabled Mopani to make the decision to continue with its mining operations at both Nkana and Mufulira rather than place the shafts on care and maintenance,” Ms Chitoshi said.
Early this month, Mopani indicated that it would close Mufulira Mine and lay off 1,400 employees by April 14, sparking complaints from the Mineworkers Union of Zambia (MUZ).
But the Government declared the move null and void, indicating that the mine should have given a 90-day notice to the director of mines, as provided for under section 34 of the Mines and Minerals Act.
Ms Chitoshi said the firm would re-evaluate the untapped synclinorium ore body, a resource of about 100 million tonnes located below the existing Nkana South and Central shaft ore bodies.
“The aging ore bodies currently being mined are now nearing the end of the productive lives. The board of directors has, therefore, resolved to re-evaluate the potential of the synclinorium ore body,” she said.
She said the measurers which had been put in place would significantly contribute to the sustainability and prolong the life-span of the mines and secure a better future for the workers.
Labels: MCM, MOPANI
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Government gives Mopani copper mines a Friday deadline
Thursday, March 12, 2009, 17:20
Government says it will not allow Mopani copper mines to place the Mufulira and Nkana plants on care and maintenance.
Mines Minister, Maxwell Mwale, says government has written to Mopani copper mines asking them to surrender the assets and expects an answer from them by Friday.
Mr. Mwale however emphasised that government will not nationalise the two mines but only secure their assets.
He told ZNBC that other investors are interested in taking over the mine and that government can not allow the management to go into care and maintenance while miners suffer.
Mr. Mwale said government will not rescind its directive to Mopani management to surrender the assets of the mines.
Mr. Mwale said due diligence tests carried out on most of the mines indicate that Zambia still has viable mineral resources.
He said there is no excuse for firms to pull out their investments from Zambia because copper prices on the market are economical.
Meanwhile, only about 10 out of more than 500 mining rights in the emerald restricted area on the Copperbelt have been developed.
This came to light at the Emerald and Semi precious Stones Mining Association of Zambia -ESMAZ- Annual General Meeting in Kitwe.
ESMAZ acting president, Dale Litana, said all the developed emerald mines are owned by foreigners.
He said the gemstone sector has seen very little development since the inception of emerald mining in the 1930s.
And Mines Safety department chief inspector of mines, Billy Chewe, assured the gemstone miners of continued government support.
/ZNBC/NEWS
Labels: JOBLOSSES, MAXWELL MWALE, MCM, MOPANI
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2 PF MPs protest job losses
Written by Margaret Mtonga
Monday, March 09, 2009 11:05:42 AM
ROAN PF member of parliament Chishimba Kambwili and his Kasama Central counterpart Saviour Chishimba yesterday staged a protest half naked at ZNBC on the job losses in the mining industry.
Kambwili, who was clad in a chitenge material, said he had decided to wage war against the pronouncements of job losses in the mines.
"Two days ago we were told that 9,000 jobs will be lost at Mopani, today in the papers it is reported that 1,321 jobs will be lost at Konkola Copper Mines. Therefore we have decided to wage war against these pronouncements, against these infesters who pretend to be investors. And we are not going to rest our case until something is done in the mining sector, until we save the jobs of our brothers," Kambwili said.
"Today is just the beginning of a lot of things. On Friday, my friend Honorable Chishimba and myself we will be at Nkana Mopani Copper Mines to conduct an on-the-spot check of what is going on. Friday afternoon we will be in Mufulira and on Saturday we will be at KCM at Nchanga just to see what has gone wrong so that we can produce a report that we are going to submit to the ministry and the President for onward action. Therefore, our protest this morning is to be in solidarity with the miners that are going to lose jobs on the Copperbelt.
And Chishimba said there was need to distinguish between individuals and legal entities.
"There is need to separate individuals and legal entities because The Post is a legal entity that has employees under it and directors," Chishimba said.
"The Post is a lifeline to many people and therefore to wage war against The Post Newspapers and generalise to say the media in Zambia has failed, to me that is unacceptable and is utter nonsense.
"We need the private media in Zambia as they do not censor stories the way the government media does it. They come out they came out the way they are supposed to be." Chishimba said it was unfortunate that at the time when the country was facing great challenges, President Rupiah Banda was busy hiring students to go to State House and denounce directors of Zambian Airways.
"If there is something wrong with [Zambian Airways chief executive officer] Mutembo Nchito and [Post editor] Fred M'membe, let the President sit down with them and not investing in students to denounce them at State House," said Chishimba.
"That is cheap politicking of the 20th Century and this is the 21st Century."
Labels: JOBLOSSES, MCM, MOPANI, PF, WORKER OWNED ENTERPRISES
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Govt asks Mopani to hand over mine
Written by Mutuna Chanda in Kitwe
Saturday, March 07, 2009 10:24:40 AM
MINES minister Maxwell Mwale has asked Mopani Copper Mine (MCM)ís shareholders to officially handover the mine to the government as opposed to putting some of its operations under care and maintenance.
But National Union of Miners and Allied Workers (NUMAW) president Mundia Sikufele has challenged the government to tell Zambians that it will be ready to run Mopani if it takes over instead of keeping it idle.
In a December 2008 analysis that was presented to shareholders and separately to Mwale and labour minister Austin Liato as well as to President Rupiah Banda, Mopani management recommended the closure of the Mufulira mine and putting on care and maintenance its four other shafts in Kitwe.
This left an uncertain future for over 9,000 Mopani employees.
In an interview yesterday following a meeting between the government and shareholders of Mopani on Thursday, Mwale said the government was extremely concerned with the future of the mine.
"As a government, we are really concerned about the future of the mine and we asked them to hand it over back to the government," said Mwale. "We also asked for some time before they put the mine under care and maintenance. I am following that up by putting the matter in writing to them today (yesterday). So let us leave it at that; we cannot discuss correspondence."
But Sikufele challenged the government to call for a tripartite meeting involving itself, Mopani and the labour movement.
"As long as we are not given an official position, we will be groping in the dark. Government should tell us if it will ready to run Mopani once it takes over instead of keeping it for the breeding of cockroaches and lizards,” Sikufele said.
He also said it was not enough for the government to say that it was taking over the mines without continuing with production of copper.
And Mineworkers Union of Zambia (MUZ) general secretary Oswell Munyenyembe complained that MCMís position on closing the Mufulira mine and putting its four other operations under care and maintenance was being done behind the unions' backs.
"We'll leave it to the government since the minister said he is aware of the Mopani position," Munyenyembe said. "It's up to Mopani and government to address this issue. They have been doing this behind our backs and this puts us in an awkward position."
He said mine workers at Mopani were anxious over their fate in view of revelations that the Mufulira mine had been recommended for closure and four other operations to be put under care and maintenance.
"Since the minister says he is aware and we have a pending request to see the President, we would like to be granted an appointment to see the President and address this issue with him," said Munyenyembe.
And Patriotic Front (PF) Kankoyo member of parliament Percy Chanda described the position taken by Mopani over the closure of Mufulira mine as an insult.
Chanda argued that the reason that Mopani gave on poor operator and maintenance skills brought about by the lack of vocational training facilities was not tenable as there were enough artisans in the country.
He also argued that transporting copper from the mine to whichever destination was not the responsibility of the mine as the cost was borne by the buyer.
He further dismissed the reason of unreliable supply of electricity.
"I live in Mufulira and we only had the issue of power outages in one quarter of the year but even then, the mine was favoured," said Chanda.
"The mine would have power in the plant and the only ones who would not have electricity are the people in the townships not the mine. They should just be honest and say they used to outsource on almost everything even what could be gotten locally. Just imagine, the mine would import safety pins and first aid dressing. They would bring in their brothers day in and day out to come and work at the mine creating unemployment for the local people but now after seeing that they have no money to pay the contractors, are they going to blame us? Today after terminating the contractors' contracts, 90 per cent of the mine is being run by Zambians and they say we don't have skills. This is an insult to Zambians and they should apologise to us."
Mopani management recommended the closure of the Mufulira mine and placing its four shafts on care and maintenance until the rebound of copper prices to profitable levels.
The mining firm stated that the Mufulira mine was a high cost operation which was at the end of its economic life given the December market price.
Mopani further stated that the copper prices rendered the mines at Nkana unprofitable for the foreseeable future.
Labels: MAXWELL MWALE, MCM, MOPANI, MUZ, NATIONALISATION, OSWELL MUNYENYEMBE
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Mopani refuses to refine copper concentrates from Lumwana
Written by Chiwoyu Sinyangwe
Thursday, March 05, 2009 9:57:39 PM
MOPANI Copper Mines (MCM) has refused to refine copper concentrates from Lumwana Copper Mines on account of aluminum contamination, according to Equinox Minerals Limited, Lumwana's holding company.
Chief executive officer Craig Williams stated that the move was despite MCM having agreed in 2007 to refine about 80,000 metric tonnes of concentrate annually from Lumwana Copper Mine project.
Williams stated that the Glencore International AG operated mine had committed to buy an additional 40,000 tonnes of concentrate as part of the five-year agreement.
He described as invalid the reason given by MCM to reject the copper concentrates from Lumwana Copper mines.
“They have said they won't accept concentrate with any measure of uranium, but virtually all concentrates all over the world have measurable amounts of uranium, so that's not a valid argument,” Williams stated.
Glencore International AG is a Switzerland-based mining company with about 73 per cent in MCM while First Quantum Minerals (FQM) Limited holds about 17 per cent and ZCCM Investments Holding (ZCCM-IH) owns 10 per cent.
Last January, Equinox Minerals Limited announced that MCM and Glencore hadn't accepted its copper because the concentrate didn't meet “contract specifications”.
Williams stated that Equinox had found buyers for the material on a short-term basis and was in talks with other Zambian parties for a longer-term agreement.
Market analysts say Lumwana Copper Mines, which was expected to start full-time large-scale mining next month, was likely to start supplying some concentrates to the Konkola Copper Mines (KCM).
KCM recently commissioned its Nchanga copper smelter with an annual capacity of 300,000 tonnes, and is believed to be “too big” for the mines concentrates alone.
Equinox sells about 55 per cent of its copper concentrate to the Chinese owned Chambishi Copper Smelter and cobalt smelter in Zambia, which hasn't refused any deliveries.
Labels: GLENCORE INTERNATIONAL AG, LUMWANA MINING COMPANY, MCM, MOPANI
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900 workers at Mopani Copper Mines face bleak future
Written by Mutuna Chanda in Kitwe
Wednesday, March 04, 2009 8:30:44 PM
THE future of over 9,000 Mopani Copper Mines workers lies in limbo as the company considers a management position to close its Mufulira mine and placing four other shafts in Kitwe under care and maintenance.
And mines minister Maxwell Mwale has said he is aware of Mopani’s intention to close the Mufulira mine and placing its other operations under care and maintenance but warned that government would not tolerate this.
In a December 2008 analysis of the future of mine shafts presented to the shareholders of the mine, Mopani management recommended closing the Mufulira Mine and placing its four shafts on care and maintenance until the rebound of copper prices to profitable levels.
Mopani stated that the Mufulira mine was a high cost operation which was at the end of its economic life given the then market price.
According to well placed sources in Mopani, the analysis was also presented to the committee of ministers that toured the Copperbelt last December comprising mines minister Maxwell Mwale and labour minister Austin Liato as well to President Rupiah Banda during his working holiday in Mfuwe.
The mining firm stated that the copper prices rendered the mines at Nkana unprofitable for the foreseeable future.
The analysis acknowledged that the Nkana shafts all had payable reserves which could be mined in future.
It also recommended the restructuring of operations at Nkana to reduce costs.
It blamed most of the mines high production expenditure on the costs of doing business in the country.
The principal driver in most of the mines high unit costs of production has been the underlying costs of doing business in Zambia and inflation, read the analysis obtained by The Post. The following environmental factors have influenced costs over the period under review: undue reliance on road transport versus rail transport impacting all goods not manufactured in the country and resulting in very high freight costs; high cost and unreliable supply of electricity; high fuel costs in Zambia; poor operator and maintenance skills brought about by a lack of vocational education facilities in the country; a high inflation rate which compounded over the five years approximates 220 per cent; poor manufacturing infrastructure resulting in higher than necessary imports of goods such as mill balls, steel support, lime coal etc.
It further attributed the high cost of production to cost increases influenced by both domestic and international factors.
ÒThe industry has suffered the following specific cost increases either as a result of global factors or local factors: labour inflation of 396 per cent. This has a marked flow on effect on contractor costs and outsourced work and maintenance; fuels, coal and coke inflation of 353 per cent; lime inflation-303 per cent- brought about mainly by monopolistic behaviour of the local supplier; building cement inflation 233 per cent, again, brought about mainly by monopolistic behaviour of the local supplier,Ó it stated.
It illustrated that over a period of five years, between 2004 and 2009, both the volume and grade of copper at the Mufulira mine had been declining.
ÒAs ore has become less accessible, the expenditure has increased by 100 per cent over a period of five years,Ó it stated. ÒThe 2009 costs of production are not sustainable in the long-term since they include substantial reductions in primary and secondary development to minimize cash flows. It is self evident that with costs of mining at US $3,000 per tonne before processing, the mining operation is not viable.Ó
It stated that the option of care and maintenance for the Mufulira mine was considered but that it was seen as not viable.
ÒCosts of care and maintenance were forecast to be in excess of US $20 million per year and management considered that this option was not viable given the short mine life. It is apparent that Mufulira has been running at a loss for several years of a full cost absorption basis. With current copper prices (December) in the low US $3,000 the operation needs to be closed,Ó it stated.
For the Nkana operation, it stated that over a five-year period, between 2004 and 2009, both the volume and grade of copper in the SOB (South Ore Body) had been fluctuating.
ÒThe 2009 budget figure which indicates an increase has been drawn up to optimize cash flows rather than extending the life of the mine,Ó it stated. ÒThe increase in operating costs has been the principal driver in the increase in unit costs. Unit costs projected for next year (2009) whilst lower than previous years are almost equivalent to selling prices and make no contribution to processing or fixed costs. Costs for 2009 are not sustainable as they exclude the necessary primary and secondary development expenditure required during normal operating times, the option of care and maintenance is recommended for this shaft. Future reserves of 125,000 tonnes of copper may become payable when copper prices improve from the current level of US $3,100.Ó
It detailed the mining environment under which the Mufulira and Nkana shafts operated.
ÒMufulira and Nkana shafts are all very old and current operations are characterised by the following factors: operations are now at the fringes of the ore bodies; grades are lower, operations are further from the shafts, tramming distances are much greater,Ó according to Mopani management.
ÒThe levels which are being mined are extremely deep by world standards. At the depth, the dewatering of mines is a fixed cost and is an extremely expensive operation accounting for up to US $900 per tonne of operational costs (depending on the shaft and the ore volumes). These factors contribute to the high costs of operations.Ó
For the Mopani central shaft, it observed that the grade of the minerals had been in decline and that in 2009 it had been projected to increase to optimise cash flows rather than extending the life of the mine.
ÒAt this grade the mine is very marginal and unless significant cost reductions or cobalt credits are available which is unlikely, the life of this shaft is limited,Ó it observed.
It recommended care and maintenance for central shaft and that further work on restructuring the mine would be necessary if it was ever to reopen.
For Mindolo sub-vertical shaft, Mopani stated that the mine had substantial reserve at a payable grade but that the mine was marginal at the then prices.
It was also recommended for care and maintenance.
ÒThis shaft has been profitable up until 2008 but at current prices, it is not viable,Ó it stated.
Mindolo North shaft was also recommended for care and maintenance.
When contacted for comment over a week ago, Mopani chief executive officer Emmanuel Mutati said the analysis was an internal document.
ÒThat paper was an internal document,Ó Mutati said.
He, however, said he was not aware if the position of the board was to close the mine and place it under care and maintenance.
Labels: JOBLOSSES, MCM, MINING
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Mopani hints on further job cuts
Written by Mutuna Chanda in Kitwe
Sunday, February 22, 2009 7:57:45 AM
LABOUR Commissioner Noah Siasimuna has said that Mopani Copper Mines has hinted on further job cuts. And Ministry of Labour sources have said that Mopani has notified government that it intends to lay off 929 workers between March and April.
Responding to questions from journalists in Kitwe on Thursday, Siasimuna said he was however not sure of the numbers involved in the intended layoffs that Mopani had indicated.
"I heard about it and I advised the senior labour officer in Mufulira that management gives the figures in writing because of the high numbers involved through redundancies due to the so-called global economic crisis," Siasimuna said.
"I have also advised that management at Mopani gets in touch with the minister periodically to brief him on what is happening because he might advise on how some employees could be redeployed."
But a well-placed source at the Ministry of Labour said Mopani had indicated the intention to retrench 929 workers in the next two months.
Recently, Mopani retrenched about 700 workers.
Almost all mines on the Copperbelt have retrenched workers and done away with contractors in order to streamline their operations in view of the global economic crisis and slump in copper prices.
And when contacted, Mopani chief operating officer Passmore Hamukoma queried the reporter on the source of the information on the job layoffs.
He said he could not confirm anything as he had been away in Lusaka for three days even as he spoke and that there could have been developments while he was away.
"To make life easier for both of us tell me who in Mopani wrote to who and what they wrote and then I can find out," said Hamukoma. "If you say there are people who are going to be laid off, there are lives involved, it's not just figures. Because I think what we did (lay- offs) in Mopani that was three weeks ago and that wasn't 900. So let's be careful, we're talking about people here and if it's not true, we are talking about people who are going underground and there's anxiety, they don't know whether they'll have a job tomorrow. Let's be a little sensitive."
Labels: GREAT DEPRESSION II, JOBLOSSES, MCM, MOPANI
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