Vedanta says it has arranged $250 million to settle Zambian copper mine debts

Vedanta needs to settle debts owed by KCM as part of a deal reached with Zambian authorities after it regained control of the copper mines and smelter.

The company regained control of KCM late last year after a five-year battle to recover the copper mines and smelter that were seized by the administration of former Zambian president Edgar Lungu which accused the company of failing to invest to expand copper production.

Vedanta said it would also grant KCM workers a 20% salary increase and once-off payment of 2,500 Zambian Kwacha (about $102).

Vedanta will still need to raise an additional $1 billion revive the mining operations and invest in advancing particularly the Konkola Deep Mining Project, which holds one of the richest copper deposits in the world.

A Vedanta spokesperson told Reuters on Wednesday the company was committed to exploring all funding options, including via debt or selling a stake in the copper assets.

Talks to sell a stake in KCM to the United Arab Emirates’ International Resources Holding (IRH) collapsed after the parties failed to agree on the assets’ value.

Vedanta owns 80% of KCM and has said it may sell a 30% of its holding to raise capital to invest in boosting copper output. The Zambian government owns 20% of KCM through state firm ZCCM-IH.

(By Chris Mfula and Felix Njini, Editing by Louise Heavens and Jane Merriman)