In a big move from the Zambian Government, an state investment company is being created that will oversee at least 30% of the production of critical minerals from future mines. Mines Minister Paul Kabuswe announced a strategy on Thursday designed to help Zambia fully capitalize on its deposits of metals essential for the energy transition.
As Africa’s second-largest copper producer, Zambia aims to more than quadruple its copper output to 3M metric tonnes by 2031. Additionally, the country possesses significant deposits of cobalt, graphite, and lithium.
According to a document revealed by Mines Minister Paul Kabuswe in Lusaka, Zambia will establish a special purpose vehicle to invest in critical minerals. This initiative will operate under a framework that includes a “production sharing mechanism,” ensuring that at least 30% of the output from new mining projects is set aside.
Several mining companies, including Barrick Gold Corp., First Quantum Minerals Ltd., and China Nonferrous Mining Corp., are investing in their copper projects in Zambia. Additionally, Zambia is relying on increased production from the Konkola and Mopani copper mines, which are managed by Vedanta Resources Ltd. and Abu Dhabi’s International Resources Holding, respectively.
To achieve the government’s target of producing 3Mt of copper annually by 2031, existing assets need to double their output to approximately 1.4Mt, as outlined in a separate document from Mines Minister Paul Kabuswe’s ministry. Exploration sites, such as the Bill Gates-backed KoBold Metals’ Mingomba project, are projected to contribute an ambitious 1.2Mt per year.
Additionally, the government plans to require investors in the critical minerals sector to allocate at least 35% of their procurement costs to local suppliers. The strategy also includes a review of Zambia’s policy and regulatory environment to limit the export of unprocessed materials.
