Zambia Today, September 3, 1997
ZCCM FORGES AHEAD WITH PRIVATISATION
By Lewis Mwanangombe - Lusaka
ZAMBIA Consolidated Copper Mines Limited (ZCCM) is expected to conclude the rest of the negotiations before December 31, 1997; chairman of the company, Luke Mwananshiku, has said.
In a report presented to the annual general meeting of the company held at Mukuba Pension Houseon Tuesday - September 2 - Mr Mwananshiku says it is expected that the privatisation of the company will be concluded successfully.
The meeting was for receiving and considering the balance sheet as at 31 March 1997 and accounts and reports of the directors and the auditors of ZCCM for the financial year ended on that date.
Mr Mwananshiku is also hopeful that as a result of the investmenents to be made by the new owners, production will increase leading to the revitalisation of the economy.
Mr Mwananshiku points out that on account of low copper prices coupled with low copper production ZCCM made an operating loss of K50,640 million during the financial year ending March 31, 1997.
On the cobalt account, however, ZCCM was able to record an operating profit of K209,542 million.
This picture, however, is mitigated by the fact by the end of the second quarter, as at June 30, 1997; the company had made a net profit of k17,404 million with K445,683 having been realised from sales of the metal. The exchange rate being K100=US$076 and K100=UKœ0.046.
On privatisation itself Mr Mwananshiku notes that so far some components of the company have been sold into private hands.
About 42 companies and groups of bidders prequalified for one or more of the asset packages offered and a total of 27 actual bids were received on 28 February 1997 which was the closing date of submission of bids for the purchase of ZCCM mine and power asset packages.
On 16 January 1997 the first sale agreement relating to the purchase of Kansanshi Mine by Cyprus Amax Minerals Company of USA was signed. Cyprus Amax will be operating through Cyprus Amax Kanshanshi Plc.
This was followed on 11 February 1997 when a Memorandum of Understanding was signed between the Government of Zambia, ZCCM and a consortium of three renowned mining companies - Zambia Copper
Investments Limited, Gencor and Falconbridge for the development of the Konkola Deep Mining Project.
The Memorandum of Understanding provides for the Consortium to undertake a feasibility study to determine the viability of the project. It is expected that by end of this month the consortium would conclude its feasibility study. Afterwards Gencor withdrew from the Consortium.
Another milestone in the privatisation process was the awarding in february this year of an option on the Konkola North Mining Area to Avmin Limited of South Africa which will carry out an exploration and evaluation programme in the area over a period of 24 months.
It is hoped that on successful completion of the programme Avmin would undertake mining exploitation and development of the area.
On 30 June 1997 an announcement was made of the approval by the Board of Directors for the sale of the Company's Luanshya Division (excluding the Ndola Precious Metals Plant) to Binani Group of India. The Binani Group is an international diversified group of companies engaged in mining, metal trading and manufacturing.
A further announcement was made on 18 July 1997 in respect of the approval by the Board of Directors of the sale of the Company's Power division (excluding bulk transport) to the Copperbelt Energy Consortium comprising Midlands Power International Limited, the National Grid Company Plc of the United Kingdom and Zambian employee participation.
On August 1, 1997 another announcement was made of the approval by the Board of Directors for the sale of Chibuluma Mine Assets to the Metorex Consortium made up of Crew Development Corporation - a Canadian Development Company; Genbel Limited (formerly Randex Limited - a mining finance company; and Metorex (Pty) Limited and Maranda Mines Limited - South African junior mining companies.
All the above privatisation awards are still subject to contract.
So far ZCCM has not touched on the privatisation of Nkana Mine and Nkana Mine which make up package 'a' of the privatisation process. Also the Mufulira underground mine and concentrator which is in package 'c', the Ndola Precious Metals plant which is in package 'h', the napumdwe pyrite mine which is package 'f', the Chambishi Copper Mine , which is package 'd' and the Chambishi Cobalt Plant, which is package 'g'.
Other assets still remaining to be sold include Ndola Lime Company, Mpelembe Drilling, Mines Air Services Limited, Zambia Detonators Limited, Scaw Limited, ZAL Holdings, ZCCM (UK) Limited.
ZCCM employs 41,030 persons out of whom 230 are expatriates in strategic positions while the rest are Zambian.
Source: ZAMTODAY |
