First Quantum said to be in talks with Jiangxi over Zambian mines

Zambia’s copper mines are facing a power supply squeeze as drought roils hydroelectric installations. Pictured: Sentinel open-pit copper mine. (Image courtesy of First Quantum Minerals.)

Canadian miner First Quantum Minerals (TSX: FM), which is reeling from the forced closure of its flagship copper mine in Panama, is said to be in talks to sell a stake in its Zambian operations to help shore its finances.

A person familiar with the matter told Reuters on Friday that Chinese state-owned Jiangxi Copper Corporation has already approached First Quantum on the matter, but that no agreement has been reached so far.

The Vancouver-based miner is the sole owner of the Sentinel copper mine and has a 80% stake in the Kansanshi mine, both in Zambia.

Jiangxi, First Quantum’s top shareholder, is said to be evaluating the acquisition of one of the two mines or a stake in one of them, according to the report.

First Quantum’s presence in Zambia, Africa’s second-largest copper producer, also includes the Fishtie copper project, near the border with the Democratic Republic of Congo.

The companies, which have been exploring the asset since 2012, recently announced it would speed up development with the goal of beginning production in 2026.

The news adds to several other rumours about First Quantum’s future, which include an alleged takeover in the making by fellow Canadian miner Barrick Gold (TSX: ABX), (NYSE: GOLD).

The gold giant has been expanding into copper as of late as it aims to double production of the metal to 1 billion pounds by 2031. It has already committed $2 billion to the development of the Lumwana super pit expansion in Zambia, and has a stake in the Reko Diq mine in Pakistan, expected to be one of world’s 10 largest when it reaches production in 2028.

First Quantum said it plans to provide an update on the company’s plan to meet its debt obligations by the end of January.