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Zambian mine denies reports of closing down

LUSAKA, Feb. 20 (Xinhua) -- Zambia's largest copper mine on Thursday denied reports quoting senior government officials that the company maybe on the verge of bankrupt and that the owners do not mind what the company is currently going through.

Last Friday, Zambian Vice-President Guy Scott told parliament that "strange things" were happening at Konkola Copper Mines (KCM) Plc, owned by London-listed Vendata Resources Plc where the owners do not mind the company being declared bankrupt or placed under receivership.

The Zambian vice-president told parliament that it appeared the company had externalized huge amounts of money and that the government was keeping "a close eye" on the operations of the mining firm.

The company, he said, had liabilities in excess of 1.5 billion U. S. dollars and that it had not paid its creditors and repaid bank loans.

The government concerns followed a report released by Foil Vedanta, an international watchdog that has been trailing the operations of the mining giant throughout the world.

The report revealed that although Vedanta Resources was making most of its money from its operations in Zambia, its contribution to the country's tax revenue was close to zero and that the company may be exporting more copper than it claims in Zambia.

According to the report, the style of operation was a pattern for Vedanta across India and elsewhere.

But according to a statement seen by Xinhua, the company has denied the reports that it was on the verge of collapsing, adding that the company will continue to build on its current investment in Zambia.

"In recent weeks, a variety of wild and misleading statements have been made about KCM and its parent company, Vedanta Resources Plc, attributed to a report by an NGO (Non Governmental Organization," the statement said.

"Our mining operations and production has never been kept secret: the Zambian people own 20.6 percent of KCM through ZCCM-IH. Therefore as a good corporate citizen, the company reports all the required operational information, on a regular basis, to its shareholders and the various regulatory agencies," the statement added.

The company added that it was unfair to claim that it was not reporting production or profits or that it was under-paying taxes.

"KCM, like any other business, has experienced many challenges. We are however, confident that working closely with the government, our valued employees and contractors, and business partners, we will succeed in developing our copper reserves and resources in a responsible, profitable and fair manner" the company said.

Last year, the company raised a storm when it wanted to fire over 1,000 employees due to operational challenges.

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