Global natural resources company Vedanta Resources has started providing funding to Konkola Copper Mines (KCM), in Zambia, and has disbursed its first $25-million for employee salaries, contract labour and other critical services needed to maintain the integrity of the asset.
Vedanta has deployed a technical team at KCM to work with the current management to ascertain the state of the asset.
This is aimed at ensuring that the business is prepared for operations once Vedanta takes over upon the conclusion of the scheme of arrangement that is before the court, the company says.
Once the scheme of arrangement has been agreed upon with the creditors, and court cases withdrawn, the KCM provisional liquidator will vacate her office after the liquidation case is discontinued in the High Court and will hand over the company to Vedanta.
This will effectively mean the liquidation process coming to an end.
The KCM board of directors will then be reinstated or reappointed by both Vedanta and ZCCM-Investment Holdings, which are shareholders in the mine.
Following the appointment of the board of directors, Vedanta says it will then work to implement the 20% salary increment to all direct KCM employees; and offer a one-off ZK2 500 across-the-board award to all direct KCM employees, and management will begin to report to the board of directors for policy decisions.
“Vedanta is deeply committed to Zambia and the Zambian people and is fully aligned with the country’s vision of producing over three-million metric tonnes of copper annually in the next ten years.
“As per its discussions with the Zambian government, Vedanta is putting in place a strategy to invest $1.3-billion to expand and modernize the KCM, and to increase the annual production of copper from the current 70 000 t to 300 000 t in the medium term,” the company says in a statement.
It adds that the company remains committed to the development of the Konkola Deeps project and meeting its agreed obligation of $250-million payment to all local small suppliers and contractors and to operationalise its proposed community development initiatives, for which it has allocated $20-million a year.