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Zambia May End Halt at First Quantum Mine Project, Minister Says

July 15 (Bloomberg) -- Zambia may lift an environmental order at First Quantum Minerals Ltd.’s $1.7 billion Sentinel copper project this week, the southern African nation’s mines minister said.

Government ministries in Africa’s biggest copper producer are three-quarters through with talks and will conclude them this week and announce a decision, Christopher Yaluma told reporters today in Lusaka, the capital.

“We are very much concerned as government to ensure that this heavy investment continues,” he said. “We are deliberating to get a better solution to lift that ban.”

The Zambia Environmental Management Authority in May ordered First Quantum to halt work at the Chisolo dam at Sentinel, citing alleged irregularities in how the company gained land rights. First Quantum continued building the mine, and it won’t be able to produce without water from the dam.

The order risked delaying first production at Sentinel by as much as a year, Vancouver-based First Quantum said July 1. Output is due to start in the third quarter of 2014, ramping up to 300,000 metric tons yearly of copper.

First Quantum in April acquired Inmet Mining Corp. for C$5 billion ($4.8 billion) to become the world’s fifth-largest producer of the red metal used in plumbing and electrical wiring.

The company held “helpful” talks over the permitting delay with the finance and mines ministries last month, John Gladston, resource optimization manager for First Quantum’s Trident project, which includes Sentinel, said July 1.

To contact the reporter on this story: Matthew Hill in Johannesburg at mhill58@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net

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