First Quantum Minerals – FQM’s is set to massively boost its financial performance after a confirmation that it would be opening a nickel mine at Kalumbila, with the company the expecting to generate revenues of about $800million per annum after a reported total initial investment of only $350 million.
FQM in a statement made available to the Zambian Business Times – ZBT, has confirmed that the mine would be opened in the next twelve months after the confirmation of an additional investment of $100 million to the $250 ‘enterprise nickel mine’ to bring the total to about $350 million.
The company stated that the mine is expected to have an annual production of 30,000 ton per annum. With the current Nickel spot prices of about $28,000 per ton, the annual revenues to be generated are expected to be about $810 million per annum, from a total reported investment of only $350 million
About 700 permanent jobs will be created once the mine is operational. The company did not however confirm its total invested amounts as analysts have stated that an annual return of $800m per annum from an investment of $100m plus the reported $250 million looks too lucrative to be true.
The opening of FQM’s Kalumbila based Nickel mine will make Zambia, Africa’s largest nickel producer. The country already had Munali Nickel mine at Mazabuka but the mine is yet to hit peak production levels.
The Zambia Revenue Authority (ZRA) is yet to share any expectations of the tax benefits they anticipate to extract as sceptics fear that the country may fail to leverage full benefits due to the global miners’ reputation of extracting massive concessions.
