Quantum eyes Zambian mines

The government of Zambia has offered First Quantum Minerals (fm-v) a seat at the negotiation table in talks related to the sale of state-owned mines and processing facilities.

The Zambian Privatization Agency is looking to sell the Luanshya copper mine, the Baluba copper-cobalt mine (both projects are known collectively as BCo) and the Ndola precious metals plant. The agency also intends to joint-venture the Chambishi copper mine.

The Luanshya mine contains reserves of 22.1 million tonnes grading 2.4% copper, whereas the nearby Baluba mine hosts reserves of 31.4 million tonnes of 2.42% copper and 0.17% cobalt and resources of 3.6 million tonnes of 2.07% copper and 0.15% cobalt.

The property on which the mines are situated hosts a resource of 32.3 million tonnes grading 1.76% acid-soluble copper, as well as a 9-million-tonne slag dump containing 0.75% copper and 0.37% cobalt.

The two mines are operated through separate shaft systems, and the ore is processed at two concentrators: the Luanshya, which has an annual capacity of 1.9 million tonnes, and the Baluba, which processes 1.5 million tonnes per year.

The Chambishi mine, which has been closed since 1988, has reserves of 33 million tonnes grading 2.55% copper, in addition to one resource of 47 million tonnes grading 2.28% copper, and another of 70 million tonnes grading 2.59% copper and 0.13% cobalt.

Meanwhile, the company has secured a loan of up to $12 million from CIBC Wood Gundy Capital to fund capital costs at Bwana Mkubwa, which is the first private-sector copper project in Zambia in 25 years. Startup is scheduled for early 1998.

A portion of the proceeds from the loan will be used to fund a due diligence review in connection with the proposed acquisition of BCo, the Chambishi copper mine and the Ndola precious metals plant.

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