Vedanta Resources Ltd. is close to taking back control of the Konkola copper mine in Zambia and plans to quickly ramp up output as demand is expected to surge in the coming years.
Billionaire Anil Agarwal’s firm is ready to pay $250 million to settle debts owed by the mine to get access to the asset again, Chris Griffith, who runs Vedanta’s base metals unit, said in an interview in London. Konkola Copper Mines was put into provisional liquidation in 2019 after the previous government accused its owner of lying about expansion plans and paying too little tax.
Copper is used in everything from power grids to electric vehicles and in data centers driving the AI revolution. Bullish sentiment about future demand as the world electrifies sent prices to a record last month and analysts expect supplies to trail demand for years.
“We think we are now literally weeks away from getting the asset back,” Griffith, said. “One of the world’s prime and premier copper mining assets is going to come back at a time when the world needs copper.”
But before Vedanta can return to Konkola, a Zambian court needs to approve the deal backed by creditors which – if sanctioned – would require Vedanta to release the $250 million to settle some debts accrued since the liquidator was appointed. Outstanding obligations to suppliers will be paid when the project is profitable.
“The money is ready to flow,” Griffith said, adding it would be “premature” to specify how his firm is raising the funds. Bloomberg News reported in April that Vedanta had discussed tolling and prepayment arrangements with commodity traders including Mercuria Energy Group Ltd., as a way to meet upfront capital needs.
Vedanta and the current administration resolved the impasse in September, with the company agreeing to spend about $1.3 billion on the asset capable of producing more than 300,000 tons of metal a year. Other than paying down the debt, Agarwal’s firm has committed to investing $1 billion over five years to complete expansion projects.
The company is looking to sell a minority stake in Konkola to finance the development. International Resources Holding – the mining unit of Abu Dhabi’s largest listed company which recently acquired another large Zambian copper project – is one of the firms that has had discussions about acquiring shares, Griffith said.
Output from Konkola’s plant – which processes ore extracted at the mine as well as third-party supplies – slumped to less than 40,000 tons of copper last year. Vedanta is targeting output of 250,000 tons in the next few years, with about 40% coming from its own ore. The long-term ambition, in the next decade, is to produce copper exclusively from its own reserves, he said.
The flagship operation – Konkola Deep – extends almost a mile underground. It is one of the world’s wettest mines, requiring the equivalent of 140 Olympic-sized swimming pools to be pumped to the surface daily in order to function.
