Glory days of Zambian mining back

By Nawa Mutumweno – Zambia’s dream of attaining 1 000 000 tonnes of copper production per annum is about to come true.

Vedanta Resources’ Konkola Copper Mines (KCM) is the straight path through which the country intends to drive forward to this beckoning destination.

One major milestone on the company’s operational terrain has been the official commissioning of the mid-shaft loading at No.4 Shaft of the Konkola Deep Mining Project (KDMP) on April 20, 2010, marking a major step towards the mining giant’s vision to increase its copper production to 500 000 tonnes annually by 2011.

“Commencement of the mid shaft loading at KDMP moves the Zambian mining industry closer to an exciting future for KCM and the country, inspiring fresh and renewed confidence in the future of copper mining, especially on the Copperbelt,” stated President Rupiah Banda who officiated at the launch.

In the recent past, the London-listed FTSE 100 Vedanta Resources Group has invested about $2 billion in capital projects since acquiring KCM five years ago. Apart from the KDMP, the other major projects are a new concentrator at Konkola and an ultra-modern 311 000 per annum capacity direct-to-blister smelter in Chingola, which was also officially opened on the same day as the commissioning of the mid-shaft loading.

The project, which was launched half a decade ago, was one of the major commitments given to the Zambian government by the mining conglomerate which also has interests in zinc, iron ore, aluminium and energy in India and Australia.

“This project enables KCM to significantly increase its rock hoisting capacity, a major step in the company’s bid to play an even bigger role in Zambia’s quest to produce one million tonnes of copper per year in the near future.  The development of the KDMP, the concentrator and the new smelter, one of only three such plants in the whole world, has introduced Zambia into some of the latest mining technology,” Vedanta Resources chairman Anil Agarwal said at the time.

KDMP is the key to accessing the ore reserves at a depth of 1 350 metres which is expected to significantly increase the life of the mine to beyond 2030. Phase 2 of the project will see the continued development of its new shaft complex to the design depth of 1 500 meters. Full project completion is expected by end of 2012.

KCM produced  41 958 tonnes of finished copper in the third quarter of the 2009/10 financial year. This figure includes 13 641 tonnes from purchased concentrates and is considerably higher than the 25 472 tonnes produced in the 2008 third quarter. The increase has been mainly due to the successful ramp up of the new 300 000-plus capacity Nchanga Smelter which has now been certified under ISO for quality. .

Production  from the Tailings Leach Plant fell to 7 922 tonnes compared to 11 263 tonnes of the corresponding quarter in 2008. This was primarily due to reduction in throughput and declined ore grade from dam suffered in the period. Earnings Before Interest Tax, Depreciation and Armortisation (EBITDA) in quarter 3 was $36.00 million compared with a loss of $165 million in the corresponding quarter of the previous year. The increase in profitability came in the wake of higher copper prices that averaged $ 6 643 per tonne in Q3 (an increase of 69% over the previous term) in tandem with lower operating costs.

KCM recently launched a campaign – dubbed ‘Tubombe Tusunge’ (working hard to preserve) aimed at raising copper production to half a million tonnes and cutting down costs to 80 cents per pound by the year 2011. This ambitious initiative is anchored on four pillars, namely, Safety, Production, Costs and Security. Apart from the renewed drive to raise production and lower the cost element, ‘Tubombe Tusunge’ , focuses on attaining these critical targets with zero lost time injuries/fatalities and a zero-tolerance for thefts and criminal activities. The company has gone a step further by introducing the Whistle Blower Policy under which the company encourages employees and other stakeholders to report or send complaints directly to the Chief Executive Officer, Director of Operations or the Mine Security wing on any suspicious activities.

The company has achieved momentous strides in the safety realm, having been awarded a Five-Star Rating of three by the British Safety Council (BSC), a feat yet to be bagged by any African-based mining house. The award comes after the first combined OHSAS 18001-Five-Star audit ever undertaken by the BSC in Africa, carried out at KCM’s Nchanga Integrated Business Unit in Chingola on the Zambian Copperbelt.

“The rating is based on the best practices at international level and our score of 81.3 percent at the first attempt is a big credit to the efforts put up by staff, especially those at Nchanga and other key players who have made this possible.  This is a major milestone in our march to attaining the highest standards in safety and occupational health,” a company spokesperson elaborated.

On the issue of Corporate Social Responsibility (CSR), the company has engaged government and other stakeholders vigorously and is ploughing back into the communities it operates. Its community support programmes encompass Education, Community Health Facilities and Service, Malaria Rollback Programme, HIV/AIDS Programme and Sports & Recreation Support. Recently it rolled out a $18 million scholarship programme , which among other sponsorships, includes five-year scholarships  tenable at top Indian universities for Zambian students to study medicine, metallurgy, engineering and commerce. KCM also participated actively in the establishment of Zambia’s third public university – Mulungushi University – in which it injected an unprecedented $17.5 million. KCM upholds the values of good corporate citizenship and seeks to contribute to the wider economic, social and environmental well being of Zambia and is committed to the principles of sustainable development.

KCM is the largest mining and metals company in Zambia. Its mines include Nchanga Open Pit, Nchanga Underground, Konkola Underground and Nampundwe Pyrite Mine. Process plants are Nchanga Concentrator, Nchanga Tailings Leach Plant, Nchanga Acid Plant, Konkola Concentrator and Nchanga Smelter. The product range covers Copper, Cobalt, Pyrite, Anode Slimes and Sulphuric Acid.

Indeed, KCM has come a long way from the bleak days of early 2002 when Anglo American unleashed a bombshell that it was pulling out of Zambia, citing low copper prices and unprofitable operations). Today, there is a silver lining in the company’s operations, guaranteeing Zambia’s sustained stay at the summit of the continent’s top copper producers.