Could you provide an overview of FQM’s assets in Zambia and the importance of the country to the company’s overall business?

First Quantum started operations in Zambia in 1996 with a small, 10,000 t/y copper mine in Ndola. Today, we have two main businesses: Kansanshi PLC, which consists of our flagship 240-250,000 t/y Kansanshi mine, and FQM Trident, which includes the 250,000 t/y Sentinel copper mine and the Enterprise nickel mine, which started commercial production in June this year. Underpinned by our two copper mines in the country, Zambia is the largest contributor to FQM’s total copper output, followed by our Cobre mine in Panama. Production at Kansanshi has been dropping over the past five years due to declining grades, but we announced a US$1.25 billionn expansion (S3 expansion) to increase production from the current 159,000 t/y today to over 200,000 t/y in 2026.

What does the Kansanshi S3 expansion entail and what has been the progress to date?

The S3 expansion will see the throughput of Kansanshi increase from 29 million t/y to over 55 million t/y by building a third pit. On the mining side, we are expanding the mining fleet significantly, with 36 new trucks as well as new dozers and excavateors, while on the processing side we are adding a new open-pit crusher, feeding into a milling plant of one semi-autogenous mill and one bore mill going into the flotation plant. We are on track to be up and running by the end of the first half of 2025, with the first ore fed into the crusher in June-July of next year and ramping up through the remainder of 2025. The crusher and the two mills are already in place, the conveyor belts are being installed as we speak, and the mining fleet has been commissioned. Over the next six months, we will be busy with the electrics, control system, and instrumentation cabling, so the project is on schedule. 

Could you highlight FQM’s progress at the Enterprise nickel project and the role of nickel in FQM’s diversification?

Enterprise is our third nickel project and the largest. We were granted by the Zambian government a large scale mining license for the development of Trident project (that included Enterprise). The construction of the Enterprise process plant was completed in 2016, but due to low nickel prices, the plant was not commissioned until 2023, with commercial production declared in June 2024. Enterprise sits adjacent to the Sentinel copper mine and presents the occurrence of a mineralized copper ore body on one side, and a nickel ore body on the other, which is rather unique in the world. This gave us the opportunity to build a nickel mine next to a running copper mine, leveraging on shared infrastructure and services to materially reduce operating costs. Even though nickel prices are currently under pressure, Enterprise is a very low-cost operation, making us competitive. Enterprise started this summer and has a guidance of 20,000-21,000 t for this year, which ramps up to just over 45,000 t/y in the next 1-2 years. The average production for the 10-12 years LOM will be 40,000 t/y, placing Enterprise at the top of the world’s largest nickel mines. 

What is your current exploration focus in Zambia?

We have two main focuses: One is close-to-site exploration around our operating mines at Kansanshi and Trident aimed at identifying LoM enhancement opportunities, particularly at  Sentinel mine, and, second, we are looking at a completely unexplored areas in the north and northwest regions of Zambia. FQM completed an aerial survey of the old Zambian Copperbelt during the first quarter of this year. We are currently compiling data to put together an exploration model to identify areas of interest for further exploration. The results of this study will be handed over to the government of Zambia in February 2025. 

How has FQM navigated the draught and ensuing energy crisis in Zambia?

To navigate the situation in the short-term, we imported power from the region, which drove our electricity costs from 9 to 14 cents/kW/hour. We also had to be proactive and take measures to secure long-term power supply, so we assembled a team to identify power generation opportunities within the country. The drought destroyed crops and ravaged Zambia’s agriculture. At FQM, we found a way to help the government support food security by using copper export trucks to transport grains into the country on back hauls.