First Quantum Minerals (FQM) has projected to be paying in excess of US$1 billion in profit tax to the Zambian Government annually once Sentinel Mine at Trident comes on stream in 2014.
FQM resource optimisation manager John Gladston said in Lusaka yesterday that the mining company was committed to paying taxes to the Government and was set to pay $1 billion once the expansion programme including the development of Sentinel Mine at Trident came on board.
In an interview, Mr Gladston said with the expansion of the Kansanshi Mine and the coming on line of Sentinel Mine, FQM would be in the position to pay in excess of $1 billion per year adding that Kansanshi would increase its copper output with additional coming from Sentinel mine.
The mine paid in excess of US$450 million in taxes to the Government last year and Mr Gladston said the firm was committed to paying more taxes once the Sentinel Mine was fully operational.
He said the taxes the firm would be paying to the Government would be above the $750 million Government raised from the Euro bond.
“We are happy to be paying the taxes to the Government and we want the tax regime to be fair and we are ready to comply with the new tax regime the Government will be putting in place.We want to be transparent in our transactions,” he said.
The firm welcomed government initiatives to audit figures of mining firms in Zambia to ascertain production figures and check who was evading tax.
He said with regard to the Corporate Social Responsibility (CSR), the mining company would be putting in place a number of projects in the mining areas where they were operating.
“We are putting in place a number of infrastructure development such as the construction of schools, clinics and industries to support the local community,” he said.
Mr Gladston said the company planned to build a township in Kalumbila together with a school, clinics and industries.”
About 2, 000 Zambians were expected to be directly employed at Sentinel Mine at Trident when it was fully operational and 400 additional Zambian jobs expected at the proposed Solwezi Smelter planned by First Quantum.
We hope Northwestern Province will have a fair share from the resources being dug from its land. We should have proper devolution with elected Provincial Governors and Assemblies. Mineral Royalties should always be paid to the provincial governments as the case is in Australia and Canada, for example. Local people should be seen to benefit from the pollution of their environment by the mining companies!
And JUST WHY DID WE GO AND BORROW KALOBA $750-million when can make a $1billion dollars from one compnya SATA CHABE YABAAA, I CANT WAIT FOR THESE 3 YEARS TO GO BYE WE FORGET ABOUT SOME PIPO.
Imagine if all these projects where Zambian owned…with profits coming to Zed and not foreigners! Wishful thinking i guess with the culture forced on us and gladly accepted in our country that only foreigners can help us improve our lifestyles…pls govt. don’t sell everything thus making it difficult for us young people to regain control of our country and resources in the near future…atleast make it difficult for them to take out all the profits gained, make them employ Zambians in top management, and maintain the use of local content in their projects so as to improve employment indirectly…
I couldn’t agree with you more my friend, this is modern day colonization and it’s sad that most of us Zambians can’t see this..
I don’t seem to agree with 1.0 and 1.1 above. These mines cost a lot of money to develop from what we call brown to green field resources to final production. Remember Kaunda nationalized the mines and drove them to extinction with his partizan Zambian appointed management of totally incompetent Black Zambians. I have just been reading of Zambians complaining about how incompetent politically appointed Zamtel management has become. You cant afford the nonsense going on at Zamtel in our only economically viable industries. Besides, FQM is listed on the Toronto and now New Ysork tock exchange and you can buy shares using your laptop or smartphone to contact any stock broker in Zambia if you feel like owning part of the mine. It is not owned by any particular whiteman as you are trying to…
And whats your take on Mopani’s operation?
@Mwamoneni. napapata boi, think THOUROGHLY before jotting down your half baked “facts”. When did KK nationalise the mines and when ACTUALLY did the mines collapse? Do you know that Anglo-America left the mines worse than they found them, after having acquired them for a song? Do you even know why the economy of Zambia suffered in the late 80’s? I pity pipo like you who always think that Zambia can only be developed by outsiders, whites to be specific. The taxes remitted by these mines is just a fraction of what they “steal” from us. Yes we can develop Zambia, if only we changed poor mindsets of little pipo like you.
Please peeople you have to understand coper is a non renewable resource, some day the reserves wil run out the investores will walk out, all those employed by mines wil be jobles.what wil hapen to our future genrations when that time comes?? if atleast some mines where state owened fo the benefit of all ambians and the generations to come Zambia would have a safe net ”meaning buliding something we will rey on when that time comes”…. wht do you think the investors are doing? they no copper wont last forever and believe it or not our copper is bulding what they rely on when copper is long gone……… Wondering what then will be left of Zambia, if they have projected paying over a billion doars tax, you should answer two questions . How much are they making? What proportion is tax?
You forget that the foreigners put in money to build the mines… why did u not put in your money.
trying to say. I also hear FQM will soon be quoted at our own Lusaka Stock exchange and you can buy kwacha stocks. I am sure the share price will not be exploitative but of course it will depend on the profitability and future potential of the stock. The future for copper stocks looks ery good and I see copper fetching US$10,000 to $12,000 by the end of 2014 due to China. They are building an electrical grid for 500 million people, that’s like wiring the entire Zambia 39 times over. May think because Chinas economy has slowed down so copper will slump the opposite is true. In addition copper inventories the world over are down. That means as Europe and USA recover they will need more of it. Lets be a lttle more reasonable as we discus investment issues gentlemen and ladies. Zambia is…
They project a profit…are you saying that we can’t do they same??? In our time daddy…Kaunda’s era is long gone…it is possible for an African to behave professionally…as long as you can make a profit you can repay loans if you are true to yourself…
Indeed You can do the same, and do whatever you like BUT what I am saying is FQM is not owned by one man. Its not like Phiri & Sons or Mulenga and Katwishi. These are large coperates as you may be aware owned by many shareholders that can include you. The advantage they have is that the money market is rather more comfortable dealing with them. For example FQM is now AA rated if I am not very sure about this though. With regards to reference to Kaunda’s time, you will find that in most instances we want to learn historical events so that we don,t repeat the mistakes. You can ignore history if you like and reinvent the wheel.
Our local journalists should pressed John Gladstone and FQM please clarify if these are employee or company taxes they were referring to or both? It would be great if the US$ 1 billion excluded employee taxes.
At least someone is thinking through thoroughly, not some bureaucrats impressed by incomplete passive statements.
Again I think we are getting into the dark areas of the decimal sciences here. Suppose there was no FQM how much over-all tax would the country have gotten?The whole is what should be looked at. A tax to FQM is a tax in the whole and is contributing to the whole national economy. What I see is the problem is the Tax being paid by the other mines such as FAWAZ, KCM, China Non Ferous etc. It appears FQM has been consistent in their tax declarations though a very new mine. KCM got an operating mine. The Chingola belt filters alone cost this country Sterling 350 million in 1978, they took over an operating Solvent Extraction Plant etc.These people paid $25million for all these assets. The journalists should take time to compare the taxes being paid by each and every mine. Thats more useful a n
Just monitor them closely, check small prints where they hide. Do not dose off or sleep or you will find they will have left you with promises and taken aeay what they came for. They will leave you with hole in the earth for little. Monitor figure from mining up to refining. Cross check every thing every day. And watch if they inflate the value of capital equipment they buy, for this is an area they strip profits off, pretending they spent large part of profit on machinery when in fact they spent less on them. Trust them but watch them.
I wish I was an economist and not an engineer that I am….Its interesting that you say this BUT remember FQM is a listed company and any shareholder at a shareholders meeting will notice what you have just said because it is bound to distort the ROE or Return on Equity of the company and no shareholder will want to spend his money in such a company. Also try to acquaint yourself with the the Law of Diminishing Returns or Diminishing marginal returns. The companies cannot operate like a corner store shopkeeper selling flip flops or salaula who want to always cheat and send profits back to South Africa, Lebanonon, Somalia or Tanzania or his village in Kasama or Chongwe. Okay they are are thefts BUT by employees in the buying departments but thats negligible compared to the whole picture.
This hurts! GRZ could have’ve just invested in heavy machinery to till our land and benefit our contry entirely instead of getting tuma hand outs after the lumpsome is shipped out, what a mess! If they can get loans using the name Zambia, why couldnt they do that for such a major project? how much billions will they get from this and for how long? Will that be enough compared to what is and will be shipped out? Sobbing sobbing!
If they(GRZ) didnt have the balls to do it,they could have called upon loaded Zambians to carry out the project and just employ some few expatraites to do a few touch ups, this is why even dual citizenship is important, cos other Zedians abroad could have come in like our fellow blogger the Engineer and others to lay a hand.
Continuation.
My point is, we like to depend on others to do the work for us as long as we can get just a bit which is utter nonsense, why not invest big and reap the fruits for generations to come than opt for foreigners to do this, who knows they also got a loan for the same project, please please Zambians with ears and eyes, lets do something anything to avoid chronic poverty in our mother land, it’s like a curse they say, am sure they are a 1000 zambians with brains to carry out a succsessful mining venture, to make sure that all neccessary steps are taken for a serious bussiness plan, i mean all entities like, Board members, Share holders, Accountants, Lawyers, engineers etc, just a full house to make this work, i mean they are human beings like us, if they did it we can also did i
This is getting very interesting. Okay, Mining is a risky capital intensive operation. Instead of mining lets just look at what we have. If you live in Lusaka, take a slow walk on Cairo Road from Kafue to North round about and count how many successful Zambian owned companies.Do the same for Cha cha cha, Freedom and Lumumba. Then go to the industrial area from Mukwa road to Mumbwa road count how many successful Zambian owned manufacturing companies. We have a mealie meal shortage but How may Zambians own milling companies. How may make bread? Sweets? Shoes? Shirts? Buttons? Footballs? Mineral water? etc… yet these are simple little operations that don’t need large capital injenctions. Why then should we want to jump into the lake when we cant even swim in a trench? Lets perfect these…
Mwamoneni, i agree with you 100%, but i also would like to tell you that, it’s about time Zambians took hands in their own hands, Rome was not built in a day, just a few nights ago i watched a programme on telly here called Dr Livingstone, a documentary on Zambia and Tanzania, my friend i saw those streets you are talking about, my word…., bussinesses on the rail line, i didnt know what to do, change the channel cos it hurt so bad to see that picture of my land, but i kept watching till the end, ubulanda, kuti walila. My point is, whose to blame for such misery, and what should be done about it, do you know what these fellows here tell me about that? they say that was Europe 50years ago.
They Europeans have history aswel, i mean, they tell me that they used to use buckets for deficating and throw every thing on the street through the window,what am trying to say is that, the government should clean up the entire country, i dont agree that we cant manage that country????!!!!!! i would go on and on giving examples of who did what, but for how long can we watch and give a blind eye, i refuse to agree that we are failures, honestly speaking imagine the wealthy being dug out and we are just watching. First of all pipo need to be panel beaten real hard, i mean educated on from the basics. Wow! it’s so unacceptable, for how long?
hope there will be real decentralization..where fiscal decentralization is implemented so that actual inhabitants a have a chance to benefit from resources for a change…question is would boma want to give local authorities that much power..we wait and see
Techinically the more tax they are paying the more mineral are tapped, and the sooner the reserves will run out…… has any one ever thought of maybe we should just employ the investors and pay then what is equivalent to tax ”wish for thinking” that is nga nimano ayachepa but I’lld ague with that……..
Thats my point when i mentioned that we get a few expatriates, i second your motion, i mean can people wakeup and agree with the dual citizenship plea? it would really help economically, on alot of things, anyway, kaya.
Combined Projections and Forecasts…that’s because by then you will be digging out 900,000 metric tonnes of copper a year.
No wonder this company is keen to sponsor the AFCON as the natives will confuse this gesture as corporate social responsibility.
Wake up people!!
zambians can’t run these mines, they failed before even zamtel had collapsed until we brought lapgreen. today zamtel is going down. major problem is political appointments, nepotism and party in power dipping their long fingers during elections…………………………………
Interesting $1bn sounds like a lot of money, but if you look at what the mining companies have been paying in the past in 2008 they claimed to have made $2bn and paid $30m in taxes. Which is an effective tax rate of 1.5% which so the mines will make close to $100bn give us $1bn all of a sudden that $1bn does not sound like a lot of money. We are being screwed!
A percentage of that tax money should be annually used to develop solwezi in terms of road infrastrature, social amenities, schools and colleges. Solwezi should not be a prodigal city despite what its earth value is. FQM dont care but that should be part of their corporate social responsibility. Solwezi should be the most industrialised city in Zambia, we need to do it now and not any other time. Shame!!!
We tried to run the mines before and failed miserably…..
People watch ‘Good copper, bad copper’ on youtube, you will hate those who privatised ZAMBIAN companies including HH and understand why most of them amassed so much weaith. They were paid off by multinational companies and sold ZAMBIAN mines for pennies.
I watched it here on telly a few months ago, really sad story, i wonder how people sleep even when they move around Lusaka and witness so much poverty and misery amongst the innocent ignorant Zambians who have no right to thier wealth in thier homeland, shame!
We tried to run mines on our own when super ken nationalized back in the 70’s .Wako ni wako philosophy the production from the mines were halved.The old geezers in power know how that worked out.They have the wisdom, to not interfere with the profit motive.147 corporations control 80% of the world economy .The rest of us should just suck it up.
Is it true that there is more gold than copper at kanshanshi? This could b a smkescreen!
Mwamoneni kindly buy the FQM shares that i bought please i have more than 2070 shares selling them at K5250 i have released i made a terrible mistake buying these shares i would rather invest in other businesses than keeping them. Because Madison Asset the broker has taken 6 months and failed to sell the shares for me useless broker
I attended interviews with FQM in ndola last year in november as an operator,when should i expect to be called?