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By Shapi Shacinda

LUSAKA (Reuters) – Canada’s First Quantum Minerals said on Tuesday it had suspended copper production at its Bwana Mkubwa mine in Zambia due to a shortage of copper ore at the facility.

“First Quantum Mining and Operations Ltd., announces the temporary suspension of copper cathode production at Bwana Mkubwa Mine,” the company said in a statement.

The mine ran out of copper ore this year, and has been relying on copper ore mined in the Democratic Republic of Congo. The DRC banned the export of copper ore to Zambia in 2007, and copper ore stockpiles at Bwana Mkubwa have run out.

“The mine has remained closed to ore export since November 2007 and Bwana Mkubwa has exhausted all known sources of suitable (and) economically viable ore within Zambia,” First Quantum said.

It said acid production would continue at at the mine, which has been exporting excess acid to other, larger copper mines in Zambia and other First Quantum units in the mineral-rich southern African country.

The company said it was exploring other ways of sourcing ore for the processing facilities. The company said the uncertainty in the global financial markets coupled with Zambia’s new mining taxes introduced in April, had further clouded the issue.

The firm said it had put all of the employees at the mine on notice that they could be made redundant, and a schedule of layoffs would be released later.

The company did not say how many of its 1,799 employees would be laid off. It said if operations recommenced, any laid off staff would be eligible for preferential re-employment.

National Union of Mining and Allied Workers president Mundia Sikufele told Reuters that the union was negotiating an exit package for the employees.

Company data showed Bwana Mkubwa copper cathode production for 2007 was forecast at 45,000 tonnes, down from 51,000 tonnes produced in 2006. There was no projection for 2008 output.

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