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“Vedanta will become a fully integrated producer of copper and cater to India’s fast-growing demand while also making Zambia the leading producer of copper in the world,”
Anil Agarwal,
Chief Executive Officer,
Vedanta Resources
After losing the control of Zambian Copper Mine, Konkola Copper Mines in 2019 when the Zambian government accused Vedanta Resources of a lack of investment and used a 20% stake in the mine to place it in provisional liquidation, the UK based mining company managed to take back the ownership of the copper mine this year. Since then, KCM struggled to keep operating under state control hence after regaining the ownership, Vedanta pledged to pay $250 million of payments to local creditors of the mine under the deal to restore its majority stake, invest $1 billion in the mine’s assets in the next five years, spend $20 million on community projects and raise workers’ salaries by 20%.
According to GlobalData, Zambia is the world’s eighth-largest producer of copper and is the second largest in Africa. Copper was discovered in Zambia in the late 19th century, and in the 1950s the Zambian copper belt dominated global production of the metal. The forced takeover of the KCM by the Zambian government in 2019 nearly paralysed operations at the KCM and triggered battles with Vedanta mounting legal battles including approaching an arbitration court in London to recover the copper assets but the agreement was reached amicably after both parties abandoned court challenges in favor of negotiations.
Much of the $1 billion that Vedanta has pledged is targeted at advancing the Konkola Deep Mining Project, an underground operation which despite holding one of the world’s richest copper deposits, has suffered from a lack of investment. This Konkola Deep mine holds about 250 million tons of copper ore reserves hence the Zambia needs a copper revival to help pay back billions of dollars in hard currency debts that are being restructured years after it defaulted in 2020. While copper is already an integral part of today’s energy system, the transition to a low-carbon future looks set to require significantly more copper, with anticipated renewable technologies requiring substantially more than traditional approaches. Copper’s role in a low-carbon economy cannot be understated.
Vedanta Resources owner, Anil Agarwal said, “Vedanta will become a fully integrated producer of copper and cater to India’s fast-growing demand while also making Zambia the leading producer of copper in the world,”
Additionally, most of Zambia’s modern copper production now comes from outside the Copperbelt, via large opencast mines in the neighboring Northwestern province where investments to expand operations are under way and to run these mines on Copperbelt is costly since they typically extend deep underground, with heavy demands on water use and power. The mines, however, still attract interest because the deposits contain relatively high-quality reserves of copper, which is heading for a shortfall as the worldwide transition to clean energy and electrification accelerates. Today, the copper industry accounts for about 0.2 percent of worldwide greenhouse gas emissions, and demand for copper is expected to double by 2050 driven by critical decarbonization technologies, such as wind turbines, photovoltaic panels, heat pumps, electric vehicles and energy-efficient equipment. Also, the International Copper Association (ICA) and its members have developed a roadmap for bringing the carbon footprint as close as possible to net zero by 2050 for copper mining, smelting, refining and recycling.
Conclusively, with focus on efforts to achieve a low carbon economy continuing to grow with, reviving copper production in Zambia is a commendable move -one metal that is expected to be a cornerstone of a low-carbon future known for its durability, efficiency, reliability.