June 22, 2011 / 2:59 PM / in 6 years

Underground operations halted at Zambia nickel mine

LUSAKA (Reuters) - Underground operations at Zambia’s Munali nickel mine have been suspended since Friday because of ventilation problems and should resume in three weeks, officials said on Wednesday.

Ventilation fans had to be switched off after a sink hole was discovered and the mine was evacuated but no one was hurt.

The mine is run by Australia-listed Albidon, 50 percent owned by China’s Jinchuan Group, and was expected to produce around 56,000 tonnes of nickel concentrate this year.

Tony Weber, assistant general manager at the mine, told Reuters the shut operations were expected to be up and running in about three weeks.

Mines Minister Maxwell Mwale earlier told Reuters the concentrator remained fully operational as the mine had some stockpiles of ore on the surface.

Albidon, which halted operations in mid-2008 at the southern African country’s only nickel mine following a fall in metals prices, resumed output early last year after China’s Jinchuan Group took a shareholding and invested $37 million.

Chinese investment is stoking popular resentment in resource-rich but impoverished Zambia with leading opposition politicans accusing businesses from the Asian giant of giving short shrift to issues of safety and pay.

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