Chambishi Metals loses $9.5m

Published On September 18, 2014 » 1968 Views» By Hildah Lumba » Business, Stories
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CHAMBISHI Metals on the Copperbelt records a loss of US$9.5 million due to erratic power supply in the financial year ending March, this year, the Zambia Consolidated Copper Mines Investment Holdings (ZCCM-IH) states in its yearly report.
ZCCM-IH acting chief executive officer, Mabvuto Chipata said Chambishi Metals lost out in the production of 3, 300 tonnes of Copper and 410 tonnes of Cobalt.?“During the year under review, Chambishi Metals Plc faced two notable strategic challenges.
Firstly, Chambishi’s copper production performance continued to be adversely affected by power fluctuations, which the company estimated resulted in losses amounting to $9.5million, of which $6.8 million resulted from lost production of 3,300 tonnes of Copper and 410 tonnes of Cobalt,” Mr Chipata said.
Mr Chipata said the Zambia Revenue Authority (ZRA) withheld the use of the $6.5 million by Chambishi in respect of the audit claim during the year following a comprehensive tax audit carried out for the period 2006 to 2011.?He said in addition, a further $23 million was withheld by ZRA as at March 2014 relating to a Value Added Tax (VAT) refund due to Chambishi Metals.
“The matter remains unresolved, but given that, Chambishi estimates that 90 per cent of its input costs are VAT deductible, the suspension has had a material effect on day-to-day operations,” he said.?ZCCM-IH has 10 per cent equity shares in Chambishi Metals, while Enya Holding BV (ENRC Group) owned 90 per cent shares.
Mr Chipata said Non Ferous FC Africa Mining Plc (NFCA)’s capital expenditure on the South East Ore Body (SEOB) project amounted to $61.58 million during the year under review.
He said the expected investment cost for the project was approximately $830 million and the project was expected to create 5,000 jobs with construction expected to be over a period of five years.
“Loan financing of $548 million is being arranged from the Export-Import Bank of China to partially finance the South East Ore Body Project with the balance coming from internally generated funds,” he said.
The SEOB project involved mining and processing of the copper ore to concentrate stage.

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