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Zambia tells Glencore to surrender copper shafts set for closure

Highlights

  • Assets reached ‘end of their economic life:’ Glencore unit
  • Government to ask technical team to verify Glencore assesment

Zambia will order Glencore Plc to hand local contractors control of two copper shafts that the company’s local unit has earmarked for closure.

Glencore’s Mopani Copper Mines announced early on Friday that it will cease operations at the Mindola North Shaft and Central Shaft because “they have reached the end of their economic life,” according to a statement emailed by the company. The government sent a team of engineers and geologists to the mine to verify Mopani’s reasons for the planned closure, Mines Minister Richard Musukwa said in a speech broadcast on state-owned ZNBC TV.

“We are studying the matter,” he said. “In the meantime, government has directed that Mopani must surrender North Shaft and Central Shaft to our local Zambian contractors, instead of putting them on care and maintenance.”

A spokesman for Mopani wouldn’t immediately respond to a request for comment.

Musukwa’s comments signal the latest strain in relations between Africa’s second-biggest copper producer and the largest operators. The country introduced new mining royalties from January as part of efforts to ensure the country gets more benefit from its natural resources, prompting warnings from the industry lobby that the increase could render more than half the mines unprofitable.

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