Mopani Copper Mines Plc – MCM has been notified by the Mines Development Department of the Ministry of Mines that it has rejected its proposal to suspend its operations pursuant to Section 37(2) of the Mines and Minerals Development Act (2015) (MMDA) and place them on Care and Maintenance.
At the beginning of May 2020, Mopani Copper Mines Plc notified the government of its intention to place the mining operations on care and maintenance after 90 days.But the Mines Development Departs has rejected the proposal, making it the second time that MCM has been turned down from placing its operations under care and maintenance.
On its first attempt to place the mines under care and maintenance, the company decided to unilaterally place the mines at Nkana in Kitwe and Mufulira all on the Copperbelt, but government disapproved its decision stating that there are rules and procedures guided by licensing conditions and laws of Zambia which the company had not followed.
This eventually led to MCM parent company Glencore then rescinding its decision to unilaterally and overnight place the mine on care and maintenance and proceeded to give the 90 days notice as per laid down regulation. There was a call for dialogue for the two parties but it seems very little has been achieved and the 90 days has now expired.
Mopani Public Relations Manager Nebert Mulenga told the Zambian Business Times – ZBT in a statement that the mine remains of the belief that the only way to protect the company’s value and preserve the option to deliver its growth projects when conditions further improve is to transition the operations to Care and Maintenance.
He said Mopani is currently assessing its options and will initiate an appeal pursuant to the MMDA against the Director of Mines’ decision within the permitted timeframe and it will further explore all options available to it to preserve the long-term value of the Mopani business.
“Mopani will continue mining operations pending the outcome of the appeal processes, pursuant to the Director of Mines’ decision and the MMDA. We will further continue to engage with the relevant government ministries on identifying potential solutions to address Mopani’s current challenges,” He said.
Mining experts have called on Mopani to be transparent on its operating costs and engage the mines department to find a way round to keep the mine operating and forestall job losses. The two mines are the economic lifeblood of two major cities or towns in Zambia, i.e Kitwe which is the second largest city in Zambia by population and Mufilira, which is also a major town on the Copperbelt.
The Association of Mine contractors had earlier in the year issued a press statement accusing Mopani of shifting its head office to South Africa and deliberately giving all major contracts to foreign entities at the expense of local companies. Augustine Mubanga, the Association president stated that the company has been systematically terminating contracts for its members.
