Konkola Copper Mines (KCM) should not look for a new investor until the legal dispute with Vedanta Resources is resolved, the Indian mining company stated on Tuesday.
In May 2019, the former administration in Zambia placed KCM under the control of a liquidator, starting the continuing legal battle with Vedanta Resources, KCM’s parent company.
Vedanta was charged by the government with violating the terms of its license, including the investment commitments made. Vedanta has consistently denied violating the license’s restrictions.
On June 7, Celine Nair, the interim liquidator for KCM, announced that the firm will hire a consultant to help it locate an equity investor prepared to finance the mine’s growth.
But Vedanta Resources spokesperson Masuzyo Ndhlovu has been quoted as saying that no investor could buy the mine and smelter complex without the consent of Vedanta.
“Significant efforts to sell KCM to other companies were made previously, but these efforts failed,” Ndhlovu said.
Mines Minister Paul Kabuswe and the government’s mining investment firm ZCCM-IH declined to comment on the matter.
“Due to the ongoing court action, ZCCM-IH is constrained to comment on the matter,” ZCCM-IH spokeswoman Loisa Mbatha said.
Vedanta would not participate in KCM’s eventual open tender to select a new investor, Ndhlovu said, calling it “illegal”.
An arbitration hearing in London is due to take place in January 2023.
Vedanta had hoped discussions with the government and ZCCM-IH, could culminate in an amicable settlement, Ndhlovu said.
“Continuation of further legal proceedings will cost a lot to Zambia and also KCM assets continue to deteriorate with no funding available,” Ndhlovu said.
Vedanta has offered to step up investment in KCM if it resumes control of the business.