After weeks of delirium over what the future of mining in Zambia was going to be with the debacle of KCM (one of ZCCM IH’s investee companies), Zambia’s premier investment company made an announcement that brought hope to investment in the sector.
“At its Special Board Meeting held on 29 March 2019, the ZCCM Investments Holdings Plc (‘ZCCM-IH’) Board approved the incorporation of a mining operating Company”, read a statement issued by ZCCM IH Company Secretary Chabby Chabala on the 28th June 2019.
For months, the ZCCM IH management team had made its intentions very clear to the market about its 5 year strategic plan which includes mining value creation. Thus far, they have continued in their aggressive move to set themselves apart by focusing on Zambia’s core mining assets through their investee companies.
The aptly named new baby in the portfolio, “Kabundi Mining Resources Limited” (KRL), joins the list of other companies namely Kariba, Kansanshi and Lubambe Copper Mines which make up some of the mining interests of the investment group.
This particular investment is a key milestone for aCEO Mabvuto Chipata as this particular investment’s explored mine area has approximately 1.6 million tonnes of manganese ore reserves with a mine life 5 years, according to sources close the subject. Furthermore, the investment group’s appetite for exploration will further be expanded and with its intentions of opening other mining sites within its exploration licence, the source further added.
KRL is located in Chief Muchinda’s area in Serenje District, Central Province. KRL is a mine operating company whose main activities include mining, processing and marketing of manganese and other non-ferrous metals.
Moving away from the traditional hunting ground for mining rights will please stakeholders as counterparties in the supply chain seeking out new territories of value creation. Remember, there are 10 provinces with untapped potential and its actions such as this one that are indicative of the potential that lies within.
With the debacle around other investments still in motion, this development comes at the right time in setting the right tone for investment in the sector. The management team of the investment group have sent a clear signal to the market that they intend to stay the course and continue on their path of value creation.
At the time of publication, the Zhengzhou Commodity Exchange valued Silicon Manganese futures at 7,544 Chinese yuan renminbi per metric tonne (approx. 1094 USD), according to the Bloomberg Terminal. The ZCCM IH share price on LuSE remain at K28.49 per share.
Source: Financial Insight Zambia