Stop it, Lungu tells KCM, CEC

ACTING President Edgar Lungu has warned that government will not sit and watch the impasse between Konkola Copper Mines (KCM) and the Copperbelt Energy Corporation (CEC) get worse as this has a serious bearing on the economy of the country.

And Information and Broadcasting Services Minister Joseph Katema has directed CEC to immediately restore power to the KCM while the mining company has been ordered to begin making payment to settle its debt obligation.

And a political activist Dante Saunders has demanded that government should consider doing away with CEC so that Zesco, the power utility company should, directly deal with the mines to avoid what was currently obtaining at KCM.

Mr Lungu said the situation at KCM had a strong bearing to the economy of the country and government was currently working on stringent measures that could resolve the problem between the mining firm and the electricity company.

He said government was keenly observing the unfolding events and that the minister of mines was working on measures to try and intervene so that both parties could resolve the impasse as a win-win situation.

Mr Lungu told the Daily Nation that government was worried about the situation and its intervention in the matter should be that which would be beneficial to both companies.

The acting president said government was worried and would not want a situation where the mining firm would be forced to shut down completely, leading to loss of employment.

He said the welfare of both the employees and the mining company was what government was looking at and hoped that the situation would not escalate beyond the status quo.

“The hope for the PF government is that the economy should be sustained and should grow. As government we would like to provide solution but the matter is in court. We are following this closely and I can confirm our minister of mines is not resting in order to come up with solutions that would benefit all,” Mr Lungu.

He said it was worrying that the two companies had failed to agree on how best to resolve the matter so that production could continue while the other party met the conditions of the court.

And mines minister Yamfwa Mukanga yesterday told Parliament that the mining firm was going through serious problems as it did not manage its mines well.

Mr Mukanga said Vendata Resouces in London had guaranteed KCM K400 million which would be used to get loans and that a US$ 250 million was given to support production. But Mr Saunders has suggested that CEC was acting as a middleman in a business transaction that did not need such an arrangements adding that the impasse was negatively impacting on the performance of the economy.

He said Zesco had the capacity to service the mines without selling electricity to CEC which later sold the power to the mines at rates outside Zesco tariffs.

“Why is it that ZESCO is not supplying power to a mining company directly rather than using a third party such as CEC to avoid what is currently happening at KCM. KCM production has certainly been affected and the country’s economy has suffered because the situation at hand  is really a mess,’ he said.