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LUSAKA, July 18 (Reuters) – Zambian authorities have granted a licence for the new Mkushi copper project where production of copper concentrate is scheduled to start in mid-2010 and peak at 59,000 tonnes, co-owners of the mine said on Friday. 

African Eagle Resources (AFE.L: Quote, Profile, Research) (AEAJ.J: Quote, Profile, Research), which owns the mine jointly with CGA Mining (CGA.TO: Quote, Profile, Research), said the authorities in the mineral-rich southern African country approved the licence application on June 26. 

“We duly acknowledged this notification and now await the conditions and fees to be set during the next phase of the approval process,” African Eagle said in a statement. 

It said mineral resources had been updated to 18.5 million tonnes at a grade of 0.83 percent copper. A consulting group carrying out the feasibility study for the process plant had made substantial progress, the firm said. 

The statement said the new taxation system announced earlier this year in Zambia, which include a minimum 25 percent windfall profit tax, an increase to 3.0 percent from 0.6 percent in mineral royalty, would not negate the viability of the project. 

African Eagle Resources Plc and CGA Mining initially plan to spend around $60.93 million to develop the mine where production of copper concentrate in the first two years is projected at 36,500 tonnes before rising to 59,000 tonnes, in the last part of the six-year mine life. 

(Reporting By Shapi Shacinda; editing by Christopher Johnson) 

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