TEL: +27 (0) 11 622 0908
FAX: +27 (0) 11 622 1312
Welcome .. Bienvenu .. Karibu .. Khala Wolandiridwa .. Mwalandiridwa .. Mwaiseni .. Chewa .. Tilandile .. Tigashire .. Sethule .. Mauya .. Semukele .. Welkom

Zambia mulls royalty cut for underground miners

Zambia is in talks with miners to lower the new royalty tariff for underground operations, which is due to take effect next month, Mines Minister Christopher Yaluma said.

The government at the start of the year raised royalties for open pit mines to 20 percent and 8 percent for underground mines, from 6 percent previously. In a bid to prevent threatened job cuts and closures in Africa’s second-biggest copper producer, the cabinet in April approved revising the tax regime and set a uniform 9 percent royalty for both open pit and underground operations.

The government is negotiating with underground mine operators to reduce the royalty, Yaluma said in remarks broadcast on state-owned ZNBC. He didn’t provide further details.

Barrick Gold Corp., which operates the Lumwana open-pit mine in Zambia, reversed a plan to halt production after the proposed changes were announced in April.

Konkola Copper Mines Plc, Vedanta Resources’ Zambian unit that produces mainly from underground operations, said in March it had a “huge task” to restructure its loss-making operations because of higher taxes and lower copper prices.

Source – Bloomberg News