Copper producers such as First Quantum Minerals Ltd. and Vedanta Resources PLC are expected to be hit by planned power outages in Zambia, which is experiencing one of its worst droughts in decades, Bloomberg News reported May 22.
State-owned power company ZESCO Ltd. will shortly start restricting electricity supply, after water levels at the Kariba hydropower dam fell to 32% by May 20, decreasing year over year from 77%.
Copper producers in Zambia use more than half of the country's electricity supply, according to the news agency.
Flows of the Zambezi river, which feeds the dam, are also comparable to those in 1995 and 1996, which were the lowest in 50 years of records, Bloomberg News said, citing government data from Zambia and Zimbabwe.
The shortage will deal another blow to Vedanta. The company's Konkola Copper Mines PLC unit is facing a takeover attempt by the Zambian government as part of escalating tensions between the state and the mining sector over increased taxes, with a provisional liquidator appointed to the subsidiary.