Mopani invests $560m in new shafts

Mon, 10 Apr 2017 11:54:51 +0000

By Buumba Chimbulu

MOPANI’S new US$323 million Synclinorium shaft and two new ones with a combined investment of US$560 million will come on stream in the next 12 months, says company chief financial officer, John Chiwele.

Mr Chiwele explained that Mopani would gradually start to move down the cost curve as new production began to come on stream from the three new shafts over the next 12 to 18 months.

“It will then take two to three years for each shaft to ramp up to full production. So Mopani’s grand objectives will be reached in full only in 2023 because mining is a long-term business,” he said.

He was speaking to the Mining for Zambia recently, a Zambia Chamber of Mines initiative.

Mr Chiwele said Mopani, wholly owned by Glencore, needed to modernise its ageing infrastructure to survive and compete in today’s world markets.

“The significance of this new investment is easier to appreciate when one realises that Mopani first started operating nearly 100 years ago, in the 1930s.

“Despite owning mines around the world, Glencore is a trading company at heart that understands the cyclical nature of commodity markets. They knew the cycle would eventually turn and they decided the investment made sense over the long-term. They took the long view,” Mr Chiwele said.

He explained that much as copper prices were rising on the international market, Mopani remained a high-cost producer if it continued to produce copper from its old shafts. “Yes, the copper price is high, and that’s great news. But as long as we are still producing copper from our old shafts, we remain a high-cost producer.

“We have a plan, we are positive and we know we’ll get there. This is all about positioning Mopani for the upturn,” he said.

The first copper ore from Mopani’s new US$323 million Synclinorium shaft, commissioned last year by President Edgar Lungu, was raised to the surface on 24th March 2017.