JOHANNESBURG (miningweekly.com) – Days after warning of delays should they not be forthcoming, copper and nickel producer First Quantum said on Wednesday it reached agreement with the government over power tariffs for its $1.7-billion Sentinel project in Zambia.
As a result, the LSE- and TSX-quoted miner’s board gave the copper project, set to start producing in late 2014, the final nod, allowing it to keep its original timeframes.
First Quantum chairperson and CEO Philip Pascall had last week cautioned that a delay in reaching a power accord beyond August would bring about lengthy delays with the onset of the rainy season.
State-owned Zambia Electricity Supply Corporation had made the company a written offer for power tariffs, which it decided to accept.
Sentinel is set to produce up to 300 000 t/y of copper, used in wiring and plumbing, and will create more than 2 000 direct jobs for Zambians, the company said.
The project is located 150 km west of First Quantum’s flagship Kansanshi mine.
The firm also plans to build a copper smelter in the Southern African State, at a capital cost of $635-million, with first production slated for mid-2014.
The benefits from the 300 000 t/y smelter included significantly reduced transport charges, export duty savings, as well as a sulphuric acid byproduct that First Quantum would produce at “effectively zero cost”, First Quantum president Clive Newall said.