KONKOLA Copper Mines Plc (KCM) now owes Copperbelt Energy Corporation (CEC) an outstanding US $155 million electricity bill, up from around US $150 million by the end of September last year.
According to a market announcement issued via CEC company secretary Julia Chaila, KCM’s unpaid electricity had leaped to around US $155 million as at March, 2021, further up from US $144 million at the end of June, 2020.
“In relation to the debt KCM owes CEC, the outstanding amount is about US $155 million. The outstanding events/circumstances surrounding the settlement of KCM’s debt and the review of the contractual arrangements in respect of continued service provision to KCM may have a material effect on the price of the company’s securities. Shareholders are, therefore, advised to continue exercising caution when dealing in the company’s securities until further information is given,” Chaila stated.
And she advised CEC shareholders that the task the company faced to conclude key commercial contracts now remained outstanding following a landmark High Court ruling on February 26, which saw Energy Minister Matthew Nkhuwa’s decision to declare the company’s infrastructure as common carrier quashed.
“Shareholders are informed that following a ruling by the High Court Judge, Madam Justice Elita Phiri Mwikisa, delivered on February 26, 2021, the Minister’s declaration of the company’s transmission and distribution lines as common carrier was quashed. Following this decision, the task of concluding key commercial contracts to guide business relationships with all parties involved is outstanding,” stated Chaila.
Since the lapse of CEC’s Power Supply Agreement (PSA) with the mine last May, KCM, under provisional liquidation, had insisted to receive electricity directly from Zesco Limited under a separate Agreement, but paying a lower tariff.
CEC posted a loss of nearly US $32.5 million for its half-year period ending June 30, 2020, mainly triggered by KCM’s failure to settle its outstanding debt owed to the former.
However, the Kitwe-based power utility finished its 2020 financial year strongly, declaring a dividend to its shareholders amounting to 2.1 US cents per share last year following an improved financial performance during the second-half of 2020.