Singapore firm takes 65 percent of Maamba coal mine
- Friday, December 18, 2009, 18:02
- Business
- 7 comments
(Reuters) – Singapore’s Nava Bharat Pte Ltd on Friday took over the running of Zambia’s Maamba Collieries, a key coal supplier to Zambia’s copper mines, and signed an agreement to build a 300-megawatt thermal power plant.
Finance Minister Situmbeko Musokotwane said Nava Bharat, which signed an agreement with Zambia, Africa’s largest copper producer, would pay $26 million for a 65 percent stake in Maamba Collieries while 35 percent of the shares would be retained by the state-run ZCCM-IH.
“The mine will be (recapitalised) at an estimated cost of $93 million and a … new 300 megawatts (MW) thermal power plant estimated to cost about $420 million will be constructed,” Musokotwane said during a signing ceremony.
Musokotwane said Maamba mine would aim to reach maximum output capacity of 2 million tonnes of coal per year in the long term. It has 78 million tonnes of known coal reserves expected to last over 70 years and produced 600,000 tonnes coal during peak production in the 1980s.
He said 25 percent of the shares in Maamba Collieries would eventually be listed on the local bourse with a larger share of that coming from the government’s stake once the firm established a track record of profitability.
ZCCM-IH Chairman Alfred Lungu said at the same signing ceremony that the company decided to bring in a strategic equity partner because of the huge investment needed for the recapitalisation of the mine and development of the coal-powered thermal power plant.
Lungu said the investment in the power plant was timely given the power deficit that Zambia was faced with, which had forced state power utility, Zesco Ltd to start to ration power.
Nava Bharat chairman Ashok Devineni also said his company would explore the possibility of building a power plant that could generate more than 300 MW.
“Nava Bharat envisages capital outlay of about $500 million to be funded by a mix of equity and debt on the proposed coal mining project and the 300 MW power project,” Devineni said.
“We foresee no problem once we have a bankable power purchase agreement with Zesco,” Devineni said.
Initially 10 firms, including London-listed Vedanta Resources Plc submitted bids to develop the power station and be an equity partner in the coal mine. Vedanta is already majority shareholder in Konkola Copper Mines (KCM), which has been a major buyer of coal from Maamba.
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Please zambians, see the type of leader you want to have in the name of sata see how he behaved on that international program, so thugerly for a leader,The PF leader, who stormed out of the programme twice and openly attacked co –guest Sharon Freeman, president and founder of All American Small Business Exporters Association for supporting Chinese investment, charged that China was engaged in modern slavery as it was out to **** Africa of its resources.
Please yes change is good, but change should make alot more sense, I would rather we stick to mmd at least they listern when pushed to the corner, I am PF but i was left with no good words for my leader in the manner he behaved on that international forum
thats what we need to review jobs
KUKU
Three quaters of the zambian popuplation are illiterates what do you expect from them.to the sata is a messiah regardless of character and interlect.add the post who have duped the illiterates whilst pursuing personal goals what do you have. A volcano
What a country! So much coal which we cant convert to money. We hope Maamba mine will be revived to what it was in the 70s and 80s. And where will the power station be- Maamba or Masuku Terminal?
I look forward to the time when the Zambian Government will trust and empower its own people. Zambia has continued to produce graduates in various desciplines every year, surely they can manage operations of some of these companies. Its time we realized that we can manage our own resources and utilize them to develop our own Country. We are one of the few Nations in the world with abundant natural resources yet we can not use them for our benefits. We just rely on outsiders to come and use us for their manpower requirements to assist the sole called investors to rape our our resources and then externalize the profits. The minerals like Gold, Selenium. Nickel…in the copper concentrates that the Investors export are not declared. Zambia has kept loosing billions of dollars and remains very poor. When there’s a slump in mineral prices on the world market, the sole called investors pull out. Whose interest do they serve?
Wake Up Zambia!!!!!
Listen to Nathan Nyirenda’s Mwemakufi.
Engineer,
Put up the $93 million dollar recapitalisation and I believe everyone will support you. What we need is investment, whether local or foreign.
I can only liken Zambia to a family having mealie-meal, chacoal or stove, water,relish and cooking stick, but fail to prepare Nshima. What a shame!
Engineer,
It is naive to even think that foreign investors are here to put the interests of Zambians before theirs. Similarly, Zambeef is in Nigeria and externalises it profits to Zambia! I don’t hear you complaining.
Investment is investment, whether foreign or local.