Amid growing concerns about future supplies, International Resources Holding RSC Ltd., (IRH) of Abu Dhabi’s plans to invest over $1 billion in Zambia’s Mopani copper mine, securing access to a critical metal for the energy transition.
On Nov. 30, the group was declared the winner of a protracted process to invest in a government-owned mine. Agreement will assist Zambia in reviving significant cobalt or copper mines that Glencore Plc formerly owned.
ZCCM Investments Holdings Plc, the majority state-owned company in Zambia. Announced on Friday that IRH will pay $620 million for a 51 percent share in the company, with the government owning the remaining 49%.
Additionally, IRH has committed to making shareholder loans of up to $400 million. ZCCM stated that it is in discussions with Glencore regarding reorganising its debt to the commodities trader.
Mopani, which was founded in 1929, needs to raise roughly $300 million to finish projects. That Glencore began and increase annual production to 200,000 tonnes. ZCCM-IH reports that Mopani lost $196 million in the first half of 2023. The company runs a refinery, a smelter, and shafts at 2 locations in the Copperbelt province of Zambia.
The agreement follows ZCCM-IH’s 2021 acquisition of the Swiss commodities juggernaut’s 90% interest in Mopani for $1 in cash and $1.5 billion in debt.
Glencore, which had a falling out with the prior government of Zambia regarding the long-term unprofitability of the operation, is still entitled to offtake rights to a portion of the mine’s production until the debt is paid in full.
Hakainde Hichilema, the president of Zambia, told reporters on Friday that the agreement’s debt reduction clause had been lowered.
“This liability has now been negotiated lower from $1.5 billion to $400 million,” the speaker stated.