THE Zambian government was not planning to buy more mines following the purchase of Glencore’s stake in Mopani Copper Mines and the confiscation of Konkoka Copper Mines (KCM), operated by Vedanta Resources.
“We are at this point in time not looking at any other specific mining operations that we want to go into a relationship with,” Finance Minister, Bwalya Ng’andu, told Bloomberg News.
Ng’andu said comments by Zambia President, Edgar Lungu in December that the country was interested in buying more mines had been misconstrued.
“In some quarters the president’s statement was misunderstood to mean that Zambia is contemplating taking over other mining firms by force or nationalising mining companies. We are not in that business at all,” said Ng’andu.
The country has learned lessons, Ng’andu said. The government can also use examples from other nations including Chile, where the state plays a significant role in copper mining, he told the newswire. “We have to make sure we run these as proper businesses without interference in their operations,” Ng’andu said.
Glencore said in January that it would sell its stake in Mopani Copper. The deal, done at a face value of $1, effectively sees the Zambian government take over $1.,5bn in debt, as well as agree to an exclusive copper offtake deal with Glencore until the debt is repaid.
The position with KCM is less clear, however.
The Zambian government claims Vedanta failed to honour investment undertakings, but the matter is being fought in the courts. Vedanta contests the government’s argument, saying disputes between shareholders should first have been aired in terms of the shareholders’ agreement.