A South African blocked the liquidation of Vedanta Resources’ Konkola Copper mines (KCM) company in Zambia. This is amid a growing dispute with the government in Lusaka. As such, the Johanneburg High Court ruling sets Vedanta Resources on a collision course with President Edgar Lungu, who has vowed to find new investors for the strategic mine.
KCM, Zambia’s largest copper mining firm, has been at the centre of a standoff between Vedanta Resources, its majority owner, and Zambia’s President Edgar Lungu as at early this year.
The Indian-founded company, which owns an 80% stake in the Konkola Copper Mines (KCM), had filed for a restriction with the Johannesburg arbitration tribunal seeking to block Zambia’s appointment of a liquidator to wind up Vedanta’s operations.
According to media reports, the court ruling serves to validate Vedanta’s plea that the Consolidated Copper Mines Limited Investment Holdings, (ZCCM-IH) representing Zambia in the matter, had breached articles of the shareholders’ agreement on winding up operations.
The High Court also ordered the ZCCM-IH to pay Vedanta’s legal costs for three lawyers who applied for the interdict.Zambia which owns just 20 percent of shares in the KCM, has been locked in a dispute with Vedanta, over the alleged abuse of its mining license since May.
According to Chibanda Kenyama, a Zambian economist based in Lusaka, Vedanta’s failure to develop the Konkola dip was evident in the serious liquidity problems it faced from overdrafts contracted from commercial banks to years of overdue suppliers’ payments.