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UPDATE 1-Zambia's mines minister says to undertake regular audits at all mines


* High Court order named a liquidator

* Vedanta, KCM have said seeking urgent talks (Adds detail, background)

LUSAKA, May 23 (Reuters) – Zambia will carry out regular audits at all mines to avoid any repeat of the situation at Vedanta unit Konkola Copper Mines (KCM), which has breached the terms of its licence, Zambia’s mining ministry said on Thursday.

A court hearing has been scheduled for Friday, according to documents seen by Reuters, following a high court order this week that named a Zambian law firm as the liquidator to oversee KCM.

Vedanta and KCM have said they are seeking urgent talks with the Zambian president over the issue.

The move has whipped up concerns among the mining community about rising resource nationalism in Africa.

Mining Minister Richard Musukwa said the government’s action at KCM “should not be misconstrued as nationalisation” and followed KCM’s failure to “comply with licence conditions”.

“The government will be undertaking regular audits at all the mines to ensure compliance and avoid the recurrence of the situation at KCM,” he said.

Zambia has already riled miners with tax changes that they say will deter the investment Zambia desperately needs after repeated warnings from the International Monetary Fund about its debts and shrinking foreign currency reserves.

Earlier on Thursday, Zambia’s Chamber of Mines said Zambia, Africa’s second largest copper producer, was at risk of a drastic fall in copper output because of the impact of the tax changes. (Reporting by Chris Mfula; writing by Barbara Lewis Editing by Alexandra Hudson)



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