3769 Investigating the Impact of Mineral Royalty Fiscal Regime Changes on the Viability of Mining the Zambian Copper Orebodies
DOI:
https://doi.org/10.17159/2411-9717/3769/2026Abstract
Zambia’s mining industry has struggled with mineral royalty fluctuations since 2008. Unlike many analyses not supported by empirical evidence, this study investigates the impact of mineral royalty on the net present value (NPV) and cut-off grade (COG) of Zambian copper deposits. The study employs the cut-off grade and mineral royalty model relationship (COGMRMR) for the assessment.
The results showed that the changes in the NPV were 10.39%, –3.40%, 6.13%, 9.69%, 6.13% and 14.92% for Barrick Lumwana, FQM Trident, Kansanshi, Nkana – Mopani Copper Mines (MCM) and Mufulira – MCM copper orebodies, respectively. The positive percentage change in NPV indicated that the rest of the investors experienced losses. On the other hand, the negative percentage change revealed that only FQM Trident Limited gained from the mineral royalty policy changes that were administered by the government. The findings further showed that the net extent of the impact of mineral royalty fiscal regime policy changes on the COG for Barrick Lumwana, FQM Trident, Kansanshi, MCM’s Nkana, and MCM’s Mufulira copper orebodies was 0.42%, 1.20%, 0.42%, –0.24%, –0.38% and –0. 25%, respectively. The positive percentage change in COG revealed a gain to the investors or a corresponding loss to the citizens. Conversely, the negative percentage change in COG signifies a loss to the investor or a gain to the government. Overall, the projects remained afloat. The study underscores the need to fairly share the economic value of mineral assets between investors and the government, making an optimal mineral royalty framework essential to benefit stakeholders.
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Copyright (c) 2026 Mwiya Winnyfred Songolo, Edward Chisakulo, Emmanuel Knox Chanda
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