NDOLA Lime Company Limited has failed to pay its creditors in excess of US$85 million. Meanwhile, close company sources have revealed that there is a possibility Ndola Lime would be taken over by a Chinese company.

But ZCCM-Investments Holdings Plc says Ndola Lime has not been sold.

According to sources, Ndola Lime is to be either liquidated, restructured, or sold. The source said currently, Ndola Lime was looking at ways to pay creditors, who are owed in excess of $85 million.

“Production units have been shut as the receiver has refused to release working capital for purchase of fuels to run the mining and kilning operations. Right now the workers don’t know what to do and have had no salaries for the last three months. I hope when this comes out, government through ZCCM-IH, will not refuse these facts,” the source said.

“So there is a possible takeover of Ndola Lime by a Chinese company called Jinchuan of China, the mining corporation with majority stake in Metorex Chibuluma Mines of Kalulushi. What is remaining at Ndola Lime is a Limestone Quarry and Mine Licence Area, which has proven reserves for many years. These are facts and a serious institution like ZCCM-IH should not be reactive to these facts. If it is explained to the workers, the better. If workers react…don’t blame them, because their future is unknown.”

The source said what was more worrying was the amount the company would be sold at.

But in a statement, ZCCM-IH public relations manager Loisa Mbatha-Kakoma refuted the claims that the company was being sold.

“ZCCM Investments Holdings Plc would like to dismiss and refute claims that Ndola Lime Company Limited (NLC) is being sold by ZCCM-IH. These claims are unfounded and false. The position is that two former NLC employees applied to Court to place the company under supervision pursuant to the Corporate Insolvency Act No. 9 of 2017. By order of the Court dated 5th October 2018, the Official Receiver was appointed as Interim Business Rescue Administrator of NLC. ZCCM-IH is seeking legal redress regarding the aforementioned proceedings,” Mbatha-Kakoma explained.

She, however, admitted that Ndola Lime was facing serious financial challenges.

“ZCCM-IH has over the past 10 years invested over K1 billion in NLC in form of debt and equity in an effort to turn around the loss-making operations of the company into profitability. However, NLC has faced several challenges, among these, being technical, financial, market, and human resource issues. The plant has been unable to produce to nameplate capacity because of failure to fully commission and optimise the new coal fired vertical kiln (“VK2”) due to technical factors,” stated Mbatha-Kakoma.

“In addition, the company has been reporting losses over the past seven years with a current debt stock standing at approximately K800 million. ZCCM-IH remains committed to the affairs of NLC and will continue to pursue all activities that better the company and ZCCM-IH’s investment. Part of this includes the consideration of engaging technical staff from NLC to work in the ZCCM-IH new Cement Plant in Masaiti, as the technical processes and operations are similar.”

On July 5, 2016, a close source revealed that Ndola Lime operations had been hampered by the high cost of heavy fuels and oils.
“The price of this fuel imported from outside the country is very high. Ndola Lime is having difficulties importing these fuels and oils. As a result, they are having incomplete combustions in their kilns hence producing poor quality lime. As a result of producing poor quality lime, their production has gone down. Upon their production going down, they have started failing to pay their workers salaries,” a source had revealed.
The source further revealed that Ndola Lime was currently using the loan acquired by the government to upgrade the kilns to pay workers’ salaries.
“A few months ago, Ndola Lime was doing some plant rehabilitation projects; they also want to start producing cement and as a result, GRZ, through ZCCM-IH, got some loan to upgrade the kilns as they are also about to start producing cement. So they have some moneys which is still lying in their accounts and that’s the money they are banking on to pay the workers. Workers are not being paid through sales of lime; they are being paid from moneys from the loan, which the government got on behalf of Ndola lime,” said the source. “This means that once the money gets finished, Ndola Lime will start facing serious challenges paying workers and as a result there are plans to downsize the workforce at Ndola Lime…And the new kilns they have installed there consume a lot of HFOs (heavy fuel oils), just like the case for Zesco with the new machines in Kariba that consume a lot of water. Ndola Lime has now reverted to the kilns that use coal, hence the few pockets of lime we are seeing on the market.”