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First Quantum Minerals, owners of the Kansanshi mine in north-west Zambia, has sourced US$1bn for the implementation of various capital projects in Solwezi
According to First Quantum Minerals (FQM) president, Clive Newall, Kansanshi Mining Plc signed the agreement for the execution of capital works at one of the country’s major mines.
“First Quantum Minerals is pleased to announce the signing of a US$1bn senior term and revolving facilities agreement by Kansanshi Mining Plc, holder of FQM’s 80 per cent owned Kansanshi copper-gold project in Zambia,” he said.
The five-year facility, featuring flexible drawing provisions, will enable the execution of the planned capital works at Kansanshi mine. The facility includes customary conditions prior to first drawdown which are expected to be satisfied imminently.
The mandated lead arrangers for the facility are Standard Chartered Bank, Standard Bank of South Africa, BNP Pariba, Citibank N.A. and African Export-Import Bank. The mine last year embarked on a project to expand the copper mine by 60 per cent in the next three years.
Annual copper production capacity is expected to reach 400,000 tonnes by 2014 from about 250,000 tonnes. FQM announced an investment of over US$1bn at Sentinel in January 2011, the first of three potential mines at the Trident Project.
“This groundbreaking ceremony marks the beginning of putting the mortar and bricks in place for the Sentinel Mine that will contribute significantly to raise Zambia’s position as a foreign capital investment hub, and augment the existing benefits for all Zambians from the resurgent mining industry,” Philip Pascal, FQM CEO and Chairman, said at the time.
Trident is the latest addition to FQM’s operations in Zambia, where it co-owns Kansanshi Mine with ZCCM-Investments Holdings. Through its wholly-owned subsidiary, Kalumbila Minerals, FQM has received the relevant large-scale mining licenses for the development of Trident.
The receipt of mining licenses is a major step forward in FQM’s plans to develop the Sentinel deposit on which it has conducted an extensive drilling programme since April 2010. The initial annual throughput at Sentinel is estimated at 25mn tonnes of ore, which is expected to ramp up to a possible 50mn tonnes of ore to produce almost 300,000 tonnes of copper. In addition, Enterprise and Trepid (the other two mines to be developed at Trident) hold promise of further expansions to Trident production.
First Quantum is also planning a US$550mn copper smelter at Solwezi which will employ a further 400 Zambians, to treat the concentrates from both Kansanshi and Trident. The major construction programme at Trident and the Solwezi smelter is expected to commence shortly with commercial production from Sentinel anticipated to commence in 2014.
“FQM has a proven record of fast-tracking projects with the telling example of Kansanshi Mine, where we reached a tax paying scenario within 16 months of operation, well ahead of the projected six years,” said Pascal. “Our competencies and capabilities will bear on the Sentinel Mine to accelerate the flow of socio-economic benefits through contributions to the national treasury and investment in corporate social responsibility (CSR) that has already started here at Kalumbila in diverse sectors such as conservation farming, forestry management, human capital development and health.”
Trident lies approximately 140 km west of the town of Solwezi and 150 km from the company’s Kansanshi Mine in North-Western Province, Zambia. The project was acquired by First Quantum in January 2010 through the purchase of Kiwara PLC.
Examples of early benefits and opportunities at Trident include:
The company is seeking to establish a community development plan with the government and stakeholders to optimise its CSR programmes at Trident. Furthermore, FQM plans to assist employees with an affordable housing scheme, in order to unlock financial security and wealth creation for workers.
To ensure minimal degradation of the environment, FQM will apply for a Joint Forestry Management area to assist the conservation of the flora and fauna in the area. Highlighting the copper giant’s socio-economic influence in Zambia, the company set aside US$9.55mn at the beginning of 2011 to undertake various CSR programmes.
In other sectors, FQM has undertaken the upgrade of the Solwezi Airport, to allow it to operate international flights and handle aircraft such a Boeing 737s, and worked to improve the Chingola-Solwezi Road, which is the main access route to north-western Zambia. In preparation for the Trident Project, FQM has signed a multi-million dollar partnership agreement with the Ministry of Education to build a new technical facility at the Solwezi Trades Training Institute. 180 students are expected to enrol on the programme by 2013.