Zambian State to Seek as Much as 25% of New Mines, Minister Says
By Matthew Hill
Zambia, Africa’s biggest copper producer, plans to own as much as 25 percent of new mines in the country as it seeks to attract investors to boost employment, Mines Minister Christopher Yaluma said.
“We don’t have any intentions to raise our ownership in most of the mining houses,” he said by phone today from Lusaka, the capital. The state owns 10 percent to 20 percent in most Zambian mines, and has a 35 percent stake in Maamba Collieries, the southern African nation’s largest coal mine.
Companies including Canada’s First Quantum Minerals Ltd. (FM), London-based Vedanta Resources Plc (VED) and Barrick Gold Corp. (ABX), the biggest producer of the metal, own mines in the country.
The government plans to announce a deal where it gets 20 percent to 25 percent ownership of an exploration project next week, Yaluma said, declining to identify the company, as talks were continuing. Zambia holds stakes in mines through ZCCM Investment Holdings Plc.
The government wants to create an “enabling environment” for mining investment to create jobs in a country with a 14 percent official unemployment rate, he said. “Our stance with investors is we value them. We need them in our country,” said Yaluma, who replaced Wylbur Simuusa as mines minister March 7.
Zambia is no longer seeking 35 percent ownership of local mines, as Simuusa said it would Oct. 20, according to Yaluma. The country, which doubled royalties for copper producers to 6 percent Nov. 11, will leave the tax regime unchanged “for a while,” said Yaluma.