Copper miner, Zambia head for legal tussle

WTI, which owns 97 percent of Ongopolo Copper Mines and Processing, Namibia’s sole copper mine, was quick to assure shareholders that the “purpoted” cancellation of the licence would not affect the Namibian operations.

In a statement, WTI said the it had received a notice from the Zambian government ministry of mines and minerals ‘purpoting to cancel licence PLLS 239 on grounds of an unspecified administrative error by a former minister of mines in issuing a prior abandonment certificate in respect of the tenement to which PLLS 239 now relates.’

WTI has pinned its growth prospects on the Luanshya copper deposits in Zambia, which is estimated to have up tp 1.4 million tonnes of copper deposits.

The copper giant has however dug in its heels and said it strongly challenges the legality of the cancellation of the licence and vowed to take all the necessary steps to protect its position

“Weatherly has taken legal advice as to the purpoted effect of the notice and a strong rebuttal has been served on the ministry of mines and minerals,” WTI said in the statement.

The firm, which earlier announced plans to tie up the Zambian and the Namibian operations said that the cancellation of the licence is illegal adding that it had been pursuing arbitration since April this year.

“Weatherly has challenged the grounds and legality of the alleged cancellation of PLLS 239 and intends to take all necessary steps to protect its position,” WTI said.

The mining firm assured investors that the licence dispute would not have an effect on revenue generating operations in Namibia.

WTI chief executive and managing director of Ongopolo, Rod Webster said that the firm would continue with its grand plan of developing the company as a fully fledged mining company.

“While this is an issue the company takes seriously, it has no effect at all on our revenue-generation operations in Namibia, where we are continuing to develop business around our recent acquisition of the Ongopolo Tsumeb smelter and associated assets,” Webster said.

“We are at the same time continuing with our further development of Weatherly as a fully integrated mining group with a wide range of revenue-generating assets,” he added.

Ongopolo owns three operating copper mines in Namibia and a recently refurbished smelter at Tsumeb, in the northern parts of the country.

WTI announced last month that the refurbished Tsumeb smelter would raise production to its full capacity of 30 000 tonnes per annum.

The copper firm also said that it has sealed deals to toll refine 5 700 tonnes of copper from the vast and mineral rich Democratic Republic of Congo (DRC) and Zambia a month in addition to the 500 tonnes, which are being generated by the local mines.

The firm has however pinned its future on the Zambian Luanshya deposits, which feasibility studies have revealed that it has a capacity to produce up to 60 000 tonnes of copper annually.

October 2006
« Sep   Nov »