Glencore Reaches Zambia Power Deal After President Steps In

Glencore Reaches Zambia Power Deal After President Steps In

Glencore Plc’s Zambian copper unit reached a deal to resume full power supply to its operations after President Edgar Lungu met with senior company officials, according to his office.

Copperbelt Energy Corp. will restore power to Glencore’s Mopani Copper Mines and the two will conclude an agreement over a period of six weeks, the Presidency said in an emailed statement Wednesday. The government will also resolve other outstanding issues with Mopani regarding tax refunds and transfer pricing over the same period, it said.

Full power supply has been restored to the Mopani operations following an agreement on new tariffs, CEC said in an emailed response to questions. A Mopani spokesman didn’t immediately respond to an email seeking comment.

CEC lowered supplies to Mopani after the company refused to pay new power prices introduced by the government at the start of the year. Mopani said the fee increase wasn’t part of its agreement with CEC and warned last week the dispute could affect 4,700 jobs. The government has said it raised prices because it needs to pay for imports and electricity from private producers.

Glencore head of copper Telis Mistakidis flew in from Geneva to represent the company in the discussions, the Presidency said.

All other mining companies in Africa’s second-biggest copper producer agreed to pay the new tariff, according to the government.

Mopani was losing $3 million a day as the company had its supplies cut to 94 megawatts from 130 megawatts, Energy Minister David Mabumba said last week, urging the company to reach a deal with CEC.

Peter Grauer, the chairman of Bloomberg LP, the parent of Bloomberg News, is a senior independent non-executive director of Glencore.

Source: Taonga Clifford Mitimingi and Paul Burkhardt

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