KCM liquidation case taking too long, but we’re managing operations, assures Milingo

Konkola Copper Mines (KCM) Provisioner Liquidator Milingo Lungu says he understand that the workers at the embattled mine are anxious because the court case has taken too long, but has called for calm, saying plans have been put in place to sustain operations.

In an interview, Milingo said the stay of KCM winding-up proceedings in the Lusaka High Court pending Vedanta’s appeal to the Court of Appeal, will not affect the operations of the mining company.

He explained that all contractual and commercial obligations remained valid and would continue to be honoured by KCM, adding that he continues to be in charge of all the mining company’s operations.

On Tuesday, the Lusaka High Court stayed the winding-up proceedings that ZCCM Investments Holdings instituted against KCM, pending the appeal by Vedanta Resources Holdings Limited to the Court of Appeal against the court’s refusal to refer parties to arbitration.

In passing her ruling, Lusaka High Court Judge Annessie Banda-Bobo said it was her considered view that Vedanta’s grounds of appeal were not sufficient to convince her that the said appeal had prospects of success but however, allowed a stay of the proceedings in the interest of justice.

She further reserved ruling to a date to be advised, on Vedanta’s application to stay some of the powers of KCM Provisional Liquidator, Milingo Lungu.

Speaking after the court development, Lungu explained that KCM had recently resumed operations at Nchanga Open Pit and Underground Mine in order to augment copper production at Konkola.

“The status quo will continue as it is. There will still be a provisional liquidator [and] KCM will still be under the charge of the provisional liquidator. In fact, what has happened is that both the Tailings Leach Plant (TLP) and the smelter are working, so they are producing. And then we have also recently started Nchanga open pit and Nchanga underground. We had to recall 500 workers who had been sent on forced leave. So Nchanga underground and Nchanga open pit are back and then also Konkola is also going to come back online in the next two weeks. They are doing their first inductions I think for a week or two and then the mining itself. So in order to do that, we had to pay off creditors who haven’t been paid at Nchanga as well as the mining contractors at Konkola,” he said.

He said the court ruling had no bearing on the on-going operations.

“The High Court in South Africa has not thrown out the appeal. What they threw out was the application for permission for appeal. So the way it works is that when you want permission for appeal, you first go before the same court which made the judgement. In the event that it refuses to give you permission to appeal, you are entitled to renew the same application in the higher court. So I am presuming ZCCM will go to the Court of Appeal in South Africa or the Constitutional Court in South Africa, one of the two, to ask for permission to appeal,” he said.

“And then in terms of the Zambian proceedings, it’s not the liquidation which has been halted because the liquidation hasn’t even started. Liquidation can only start when a winding-up order has been given. So what has been stayed is the hearing of the petition because if you recall, what was supposed to happen yesterday (Monday) was parties were supposed to start calling witnesses in favour or in opposition to the petition and then after that the court makes a decision whether to wind up the company or not. So the court said in the interest of justice, it won’t proceed to hear the evidence in favour or against the petition but will wait for the outcome of the appeal that Vedanta has made.”

He urged the workers to remain calm, admitting that anxieties were high, given the fact that the court process had taken too long.

“All I can ask [the workers] is that they should exercise maximum patience as we wait for the due process of the law to be followed. Obviously, everyone is anxious and concerned that the process is taking long but I think the courts also do recognise the importance and urgency of the matter and are treating it as such. We urge all the employees and Business Partners to remain calm, and continue to work safely as we ramp up production. Our Legal team is actively working towards securing KCM interests and ensuring that the due process of the law is followed. All contractual and commercial obligations are valid and will continue to be honoured by KCM,” said Milingo.

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