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(Bloomberg) — Vedanta Resources Plc, the mining company founded by Indian billionaire Anil Agarwal, said it was facing “a very, very difficult situation” at its Zambian copper unit amid an increase in taxes and low metal prices.
Konkola Copper Mines is reviewing operations in the southern African country as metal prices reached a five-year low in January, it said last month. Measures in Zambia, which is Africa’s biggest copper producer after Democratic Republic of Congo, to raise royalties to as much as 20 percent from 6 percent were implemented this year. The government withheld more than $600 million in refunds to mining companies, including Vedanta, that it says haven’t supplied required documents for value-added taxes.
“We will have to make some very difficult decisions, even with the support of the government,” Vedanta Chief Executive Officer Tom Albanese said in a Cape Town panel discussion Monday. A “situation where the government is chasing capital and chasing investment away, it makes our jobs even harder.”
The government of President Edgar Lungu has made “some encouraging remarks” since being elected in January, Albanese said, without elaborating further. Lungu was elected last month. Copper has gained 6.4 percent since reaching $5,339.50 a metric ton on Jan. 26, the lowest since July 2009. It was trading at $5,689 at 4:04 p.m. in London.
To contact the reporters on this story: Andre Janse van Vuuren in Johannesburg at[email protected]; Jesse Riseborough in London at[email protected]
To contact the editors responsible for this story: Will Kennedy at[email protected] Ana Monteiro, Gordon Bell
