Glencore International, the major shareholder in Mopani Copper Mine, has certainly stirred up a hornet’s nest which requires an eagle’s eye to examine all salient points.
Clearly, Zambia feels that Glencore’s arbitrary decision to place Mufulira and Kitwe units under care and maintenance is a breach of trust.
The decision was so sudden that miners and other employees at Mopani were caught off guard and greeted by shut premises as they reported for duties last week.
Be as it may, Glencore has stood its ground, spurning Government’s advice to rescind the hasty decision when, under normal circumstances, partners are supposed to be on the same wave length.
Yes, Glencore International AG is the majority shareholder at 73.1 per cent with First Quantum Minerals Limited holding 16.9 stake while Government through ZCCM-IH has 10 per cent but there ought to be mutual respect.
A cursory look at history will unravel Glencore’s promise of heaven on earth.
Zambians, and captains of industry in particular, do recall that Glencore commissioned an ambitious $232 million synclinorium shaft at Mopani in Kitwe in May 2016.
Memories are still fresh that the international conglomerate made a firm undertaking that with the coming on stream of the synclinorium project, the mine’s lifespan was extended to between 25 and 30 years.
At the time, Glencore also flaunted $1.1 billion pledge for a number of projects aimed at transforming Mopani into a modern mining operation.
The investors did categorically state that come rain or sunshine, operations will remain on track, an assurance which has come to haunt the Switzerland headquartered firm.
That copper prices and the outbreak of coronavirus have precipitated the closure of the mine is far-fetched.
Mopani management must explain what has happened to the synclinorium shaft in Kitwe and the massive concentrator that was put up in Mufulira at great cost.
How much of the rich ore in Kitwe at the synclinorium has been mined and is the Mufulira concentrator operational?
Copper prices have not dipped to force any mining powerhouse to shut down as they are now around $4,963 per tonne on the London Metal Exchange – not too bad a price!
Even if it were not shipping the commodity, the mining firm could have been stockpiling and export after the situation in many countries normalises.
It appears though that investor has underlying woes as recently Glencore’s Katanga Mining sent 350 workers packing last week in the Democratic Republic of Congo after delaying the commissioning of an acid plant.
Yes, 350 Indian contractors from the mine site near Kolwezi to Lubumbashi were to be repatriated.
When Mopani was conceived in April 2000 in Zambia assets that were purchased from ZCCM included underground mines, a concentrator, a smelter and a refinery at Mufulira mine site.
In Kitwe it had underground mines, open pits, a concentrator and a cobalt plant at Nkana mine site but today the story is different.
Thus Glencore must fulfil all promises made at the time, lest Zambians conclude that that was mere hot air.
Therefore, it is not too late for Glencore to come to terms with the reality and state the truth other than proffering unconvincing reasons for the drastic decision.
The effects of such a decision will be too deep for the 11,000 miners, contractors and suppliers as well as the country’s economy.
Save Mopani!
