Glencore’s announcement was brutal: 80% of the Kamoto Copper Company’s expatriates have been laid off along with 20% of local staff. In Zambia, Mopani, CNMC Luanshya Copper Mines and KCM have all begun redundancy plans. Other mining groups, such as ENRC, are implementing similar measures to reduce or suspend production.
The chain of reaction has been quick to set inmotion. Mining sub-contracts are already feeling the brunt.
What is new here is that while seeking fallback solutions these companies are also engaging in investment plans and upgrading equipping to ultimately reduce production costs. Everyone’s target is to drop under $1.5/lb.
Serious steps to upgrade equipment herald a wave of measures to streamline costs and give the Congolese and Zambian mining industry long-lasting resilience to metal price fluctuations.They are a move towards bringing operating costs closer to industry standards.
Other good news to come out of this quagmire is Ivanhoe’s announcement of the DRC’s approval of the sale of its stake in the Kamoa project to Zijin Mining Group Co., signalling the development of the project.
To complete this virtuous cycle, will the Congolese and Zambian governments finally accompany these upgrades with a plentiful supply of power?
In short, we do have some reason to hope while we “shrug off” the crisis for the next 24 months…
Happy reading, The editorial team.