Mining

Zambia has increased power tariffs for mining companies in a bid to lure companies to invest in power generation.

The increase in prices by 26% comes as the country is facing severe electricity crisis, which has worsened by a drought.

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Reuters quoted energy minister Dora Siliya telling mining companies that effective of 1 January 2016 they have to pay $10.35 cents per kilowatt hour.

Previously the companies paid $8.20 cents per kilowatt hour.

Glencore, First Quantum Minerals, Vedanta Resources and Barrick Gold are some of the companies operating in Zambia.

Glencore and Vedanta suspended operations in the country and cut jobs following a slump in copper prices.

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"Glencore and Vedanta suspended operations in the country and cut jobs following a slump in copper prices."

Vedanta Resources-owned Konkola Copper Mines (KCM) closed its Nchanga underground mine in Zambia in November 2015 citing weak global demand for base metals.

During the same month, Glencore’s Zambian unit released 4,300 workers after the company deepened cuts in copper output.

According to the Chamber of Mines, the industry could see more mine closures in 2016 due to the weak prices, Bloomberg reported.

In November 2015, Zambia President Edgar Lungu directed the Energy Ministry and the power regulator to hike electricity charges in the country owing to rising costs.

Image: Effective 1 January 2016 mining companies are required to pay $10.35 cents per kilowatt hour. Photo: courtesy of worradmu/FreeDigitalPhotos.net