Splitting KCM will cause heavy national losses, says Vedanta

VEDANTA Resources Holdings Limited and its parent company, Vedanta Resources Limited, say any plan by the provisional liquidator to split KCM business into two units before ultimately selling those units independently would result in substantial loss of revenue for the country.

In a statement, Vedanta says it is committed to KCM, the local communities that live in the Copperbelt region and to the Zambian people.

“Vedanta notes that any plan by the provisional liquidator (Milingo Lungu) to split the KCM business into two units before ultimately selling those units independently would result in a substantial loss in revenue for the Zambian state and its people, as well as the long-term erosion of the individual assets’ value,” the statement read in part.

It said since Vedanta Resources became a shareholder in KCM in 2004, it had invested over US $1.7bn in the mine’s operations.

Vedanta said such investment helped establish KCM as a world class copper mining and metals company underpinned by strong sustainable development practices.

Vedanta said it had also spent over $900m on developing the Konkola Copper Mine and increasing its life to 2030.

Vedanta said it had further invested over $450m on a new smelter at Nchanga.

“Similarly, there is no other smelter in the country that is equipped to refine the cobalt present in the Konkola ore body and thus produce the valuable cobalt alloy,” Vedanta said. “The two units, the mine, and the smelter, are clearly designed to work as one integrated structure and any deviation away from this model by the PL (provisional liquidator) will result in a significant loss of value for all stakeholders involved in KCM.”

It said Vedanta’s investment at KCM had also led to the business being one of the most advanced and technologically clean assets in the world.

It said as a result, Nchanga smelter had achieved 99.6 per cent sulphur capture and had been ranked second in the world for environmental performance.

“The introduction of HDPE-lined tailings pipelines at Nchanga has also reduced the level of discharges significantly. Vedanta has ensured that three new zero-discharge concentrators have replaced the much older concentrators, whilst the level of total suspended solids in discharged water decreased substantially from 200mg/L in 2009 to 70mg/L in 2012,” said Vedanta. “The future of KCM is of utmost importance to Vedanta Resources, and the company is committed to making a positive contribution to KCM’s employees and their families; business partners, suppliers and their employees; the communities where we operate; the people of the Copperbelt and the people of Zambia.”

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