Having faced a significant detrimental impact stemming from the pandemic over the past year, Kagem Mining will reopen principal operations at its Lufwanyama emerald mine in a phased manner.
The reopening process will commence with the wash plant production area followed by the mining operations and is expected to complete by the second week of April 2021.
This follows a suspension of all but critical operations since 30 March 2020, during which time Kagem employees (excluding those on critical operations) were placed on leave.
Employees on leave have continued to receive basic (80%) salaries, in line with the new Employment Code Act 2019 (Act No. 3 of 2019) throughout the suspension period, despite not working.
Kagem has been able to avoid redundancies and retain its workforce due to the financial support provided by the majority shareholder, Gemfields Limited, which owns 75% of Kagem in partnership with the government’s Industrial Development Corporation (IDC), which owns 25%.
Due to the continued uncertainty surrounding Covid-19 and subsequent mitigation measures limiting travel and logistics, Gemfields remains unable to provide reliable guidance as to when it might return to its regular auction format and schedule, meaning future revenues remain uncertain.
However, with the Minister of Mines’ approval, Gemfields was able to hold a series of mini-auctions in the last quarter of 2020. Incorporating shuttle viewings in different cities, followed by bid submission via an online auction platform, the completion process of each auction was monitored live by the Zambian Government.
This pilot project was successful in that it generated some income which will assist Kagem in restarting its principal operations.
Kagem continues to closely monitor developments of the Covid-19 pandemic, such as the rise of the new variant and has, under this “New-Normal Covid-19 Environment”, put in place management systems, in line with the Ministry of Health Covid-19 Management Protocols, which include Rapid Antigen testing and thermal body temperature reading cameras in order to minimise the risk of contagion.
Kagem will look to equip the Nkana Health Centre (built and equipped by Kagem in Chief Nkana’s Village and donated to the Government of the Republic of Zambia in 2016) with the necessary provisions to treat Covid-19 in the event that any of its employees contract the disease.
Upon confirmation by the Government of the preferred suite of vaccines to be acquired for Zambia, Kagem has also pledged to purchase these for its employees as a corporate body, administered through the Ministry of Health, to ensure Kagem staff are vaccinated during the nationwide vaccination programme roll out.
Despite the ongoing challenges faced as a result of the pandemic, Kagem remains committed to delivering strong production and successful auctions in the 2021 financial year, to maintaining employment for the local workforce and to delivering financial contributions back to Zambia.
