Vedanta’s Zambian unit, Konkola Copper Mines – KCM Corporate Affairs Manager Eugene Chungu says the mine has committed to offset debts owed to local suppliers by the end of 2018 following a mutual agreement with effected suppliers and contractors.
Chungu was speaking during a meeting with the local suppliers and contractors held today, Monday 5 November 2018. During the meeting, Chungu assured the local suppliers and contractors that the mine will resolve the matter by dismantling the debt in three phases from October, November and December.
He added that payment to suppliers and contractors started at the end of October and is expected to be completed in December this year.
“Yes we have been engaging our colleagues to see how best we can handle the debt owed to them, but from the onset I can confirm that we reached an agreement to offset the bill by the end of December,” Chungu said.
He said the two parties agreed that KCM pays one third of what it owes every supplier within a period of three months.
KCM has been under fire in the last few months for failure to pay local suppliers and contractors on time.
KCM is an almost UDS1 billion business who in March 2017 financial statements reported total revenue of K8,621.47 million (about US$874.3 million) while in2016, the Copper and Cobalt Minet reported revenues of K9,607.04 million (about US$972.5 million).
The mine has of late been reported to have a poor record in meeting their trade and supplier terms. The copper prices on the international market which is a key driver to revenue generation has been fairly at levers above USD6,000 per tonne.
There seems to be a systemic supplier and contractors management problem at KCM as other large copper mines on the Copperbelt like First Quantum Minerals, Glencore’s Mopani Copper Mine etc have performed way much better as far as timely payments are concerned.