{"id":24333,"date":"2022-06-17T20:25:44","date_gmt":"2022-06-17T20:25:44","guid":{"rendered":"https:\/\/www.africa-press.net\/zambia\/all-news\/glencore-helps-mopani-copper-mines-pay-bills"},"modified":"2022-06-17T21:56:28","modified_gmt":"2022-06-17T21:56:28","slug":"glencore-helps-mopani-copper-mines-pay-bills","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/zambia\/all-news\/glencore-helps-mopani-copper-mines-pay-bills","title":{"rendered":"Glencore helps Mopani Copper Mines pay bills"},"content":{"rendered":"

Africa-Press – Zambia. <\/strong><\/span>Reuters reports that Mining and commodity trading giant Glencore has helped to fund Zambia\u2019s Mopani Copper Mines as the company has been unable to pay its bills on time and the state has yet to find a new investor more than a year after it took over the complex.<\/p>\n

Glencore (GLEN.L), which sold Mopani to state mining investment firm ZCCM-IH (ZCCM.LZ), has since helped cover some of Mopani\u2019s running costs, including power bills and purchases of copper concentrate from third parties, two sources with direct knowledge said.<\/p>\n

One of the sources said Mopani was not generating enough revenue to meet current expenditure, adding that the company could not afford the investments needed to mine more and take advantage of high copper prices . The sources asked not to be named because they were not authorised to speak to the media.<\/p>\n

Glencore has provided letters of credit to Mopani on two or three occasions when the company did not have enough cash to buy copper concentrate, effectively guaranteeing Mopani\u2019s purchase, a third source close to Mopani said.<\/p>\n

Mopani Copper Mines CEO Charles Sakanya said the company had not received any loans from Glencore and that claiming Glencore was covering some of Mopani\u2019s costs was speculation. He did not respond to a request for comment on the letters of credit. Glencore is the sole off-taker of copper from the mine, under the deal that saw ZCCM-IH take control of Mopani on March 31 last year for $1.5 billion in debt and a nominal $1 in cash.<\/p>\n

The sources did not say how much funding Glencore had provided. Glencore did not answer Reuters\u2019 questions about Mopani\u2019s costs, but said in a statement: \u201cGlencore is continuing to work alongside ZCCM-IH to ensure the success of Mopani through our offtake agreements and related funding arrangements.\u201d<\/p>\n

Zambia\u2019s President Hakainde Hichilema, who was elected in August last year, criticised the Mopani deal while in opposition, saying the state should not take on more debt when it had defaulted two months earlier and was in talks with the International Monetary Fund (IMF) for financial support.<\/p>\n

Zambia\u2019s need for investment remains pressing. It reached a staff-level agreement with the IMF on a $1.4 billion extended credit facility in December, but the money cannot flow until Lusaka and its creditors agree on reducing the debt to sustainable levels.<\/p>\n

Since his election, Hichilema has asked his administration to find a new investor for Mopani. Officials say they are \u201cvery close\u201d to doing so. read more<\/p>\n

\u2018MASSIVE MONSTER\u2019<\/b><\/p>\n

Mopani\u2019s Sakanya said the mining company had to renegotiate agreements with suppliers, copper concentrate purchase contracts, letters of credit and overdrafts after the change in ownership.<\/p>\n

Those negotiations, along with a breakdown at the north shaft in March, resulted in delayed payments. One supplier said the frequency of payments from Mopani had slowed over recent weeks.<\/p>\n

\u201cThey\u2019ve got this massive monster to run, and they don\u2019t have enough money to run it,\u201d the supplier said, asking not to be named.<\/p>\n

\u201cYes, we do owe some money,\u201d Sakanya said, adding that he could not say how much as the figure is constantly changing. \u201cIt\u2019s something we are working through to resolve.\u201d Reuters could not independently establish how much Mopani owes its suppliers in total.<\/p>\n

A fourth source with direct knowledge said government officials asked Copperbelt Energy Corporation (CECZ.LZ), the electricity supplier to the mine, late last year to relax its payment terms, but CEC refused.<\/p>\n

CEC said Mopani has continued to pay its power bills on time. Zambia\u2019s mines minister Paul Kabuswe, reached by telephone, declined to comment on whether Glencore was providing financial support to Mopani.<\/p>\n

\u201cWhen we find a better partner everything is going to get back to normal,\u201d he said.<\/p>\n

Finding a new investor in Mopani is seen as a litmus test for the administration, which wants to show Zambia is open for business and has set an ambitious goal of more than tripling the country\u2019s annual copper production within the next decade.<\/p>\n

\u201cI want to find an investor yesterday, that\u2019s the timeline,\u201d Kabuswe said. \u201cI\u2019m in a hurry.\u201d<\/p>\n

Mopani, which is more than 80 years old, with its original smelter built in 1937, needs $300 million to fund an expansion that would unlock the potential to produce 225,000 tonnes of copper annually, Sakanya said. Mopani said it produced 87,618 tonnes of copper cathode in 2021, down from 93,106 tonnes in 2020.<\/p>\n

It is expected to produce 80,684 tonnes of copper this year, Sakanya said, putting the near 8% expected to drop down to the month-long breakdown and a planned 45-day shutdown of the smelter for maintenance in July.<\/p>\n

Glencore decided in April 2020 to put Mopani on care and maintenance, drawing the ire of the Zambian government which wanted it to stay open, and later in 2020 wrote down the value of the mine by $1.041 billion to $861 million. Glencore said it had invested $4.4 billion in Mopani since 2000.<\/p>\n

For More News And Analysis About Zambia<\/a> Follow Africa-Press<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Africa-Press – Zambia. Reuters reports that Mining and commodity trading giant Glencore has helped to fund Zambia\u2019s Mopani Copper Mines as the company has been unable to pay its bills on time and the state has yet to find a new investor more than a year after it took over the complex. Glencore (GLEN.L), which […]<\/p>\n","protected":false},"author":84,"featured_media":24332,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,6,8,16],"tags":[234,235,233],"class_list":["post-24333","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-files","category-homepage-english","category-twitter","tag-africa-press","tag-africa-press-zambia","tag-zambia"],"yoast_head":"\nGlencore helps Mopani Copper Mines pay bills - Zambia<\/title>\n<meta name=\"description\" content=\"Reuters reports that Mining and commodity trading giant Glencore has helped to fund Zambia\u2019s Mopani Copper Mines as the ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/zambia\/all-news\/glencore-helps-mopani-copper-mines-pay-bills\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Glencore helps Mopani Copper Mines pay bills\" \/>\n<meta property=\"og:description\" content=\"Reuters reports that Mining and commodity trading giant Glencore has helped to fund Zambia\u2019s Mopani Copper Mines as the ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/zambia\/all-news\/glencore-helps-mopani-copper-mines-pay-bills\" \/>\n<meta property=\"og:site_name\" content=\"Zambia\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2022-06-17T20:25:44+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-06-17T21:56:28+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/zambia\/sites\/35\/2022\/06\/img-62acf86eb5df3.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"800\" \/>\n\t<meta property=\"og:image:height\" content=\"509\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/zambia\/all-news\/glencore-helps-mopani-copper-mines-pay-bills#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/zambia\/all-news\/glencore-helps-mopani-copper-mines-pay-bills\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/zambia\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"Glencore helps Mopani Copper Mines pay bills\",\"datePublished\":\"2022-06-17T20:25:44+00:00\",\"dateModified\":\"2022-06-17T21:56:28+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/zambia\/all-news\/glencore-helps-mopani-copper-mines-pay-bills\"},\"wordCount\":836,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/zambia\/all-news\/glencore-helps-mopani-copper-mines-pay-bills#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/zambia\/sites\/35\/2022\/06\/img-62acf86eb5df3.jpg\",\"keywords\":[\"Africa Press\",\"Africa Press-Zambia\",\"Zambia\"],\"articleSection\":[\"all news\",\"files\",\"homepage-english\",\"twitter\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/zambia\/all-news\/glencore-helps-mopani-copper-mines-pay-bills#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/zambia\/all-news\/glencore-helps-mopani-copper-mines-pay-bills\",\"url\":\"https:\/\/www.africa-press.net\/zambia\/all-news\/glencore-helps-mopani-copper-mines-pay-bills\",\"name\":\"Glencore helps Mopani Copper Mines pay bills - 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