Zambia Mining Outlook 2025: Copper Recovery and the Critical Minerals Opportunity

Market Context

Zambia occupies a strategically critical position in global copper supply chains. As the world's second-largest copper producer in Africa (after the DRC), Zambia's output trajectory has direct implications for global copper markets, the energy transition and critical minerals supply chains.

The period 2015–2021 was characterised by significant policy volatility — multiple royalty rate changes, licensing disputes and fiscal uncertainty that suppressed investment. The election of President Hakainde Hichilema in August 2021 marked a decisive shift. His administration's commitment to a stable, predictable mining investment framework has been broadly delivered, and the results are visible in the project pipeline.

Production and Investment Pipeline

Current copper production stands at approximately 830,000 tonnes per annum (2023), with the trajectory pointing firmly upward. Key projects driving this expansion include:

First Quantum Minerals — Kansanshi S3 Expansion: The single largest copper mining investment on the African continent. The S3 expansion is designed to extend the mine life by 15 years and add approximately 150,000 tonnes of additional annual production. Construction is progressing on schedule.

Ivanhoe Mines — Kamoa-Kakula (DRC/Zambia context): While located in DRC, the Kamoa-Kakula operation's production feeds through Zambia's logistics corridor, reinforcing Zambia's position as a critical minerals transit and processing hub.

Emerging Explorers: Junior mining companies are active across the Copperbelt and Northwestern Province, with several licences advancing toward feasibility study stage.

Critical Minerals Diversification

Beyond copper, Zambia's critical minerals endowment is increasingly recognised. Lithium, manganese and cobalt deposits that were historically ignored are now receiving serious exploration attention given battery supply chain demand. The government's draft Critical Minerals Strategy (expected 2025) is anticipated to provide a preferential licensing and fiscal framework for these commodities.

Regulatory and Fiscal Environment

The mining fiscal regime has stabilised considerably. The current royalty rate structure (tiered 4-6% depending on copper price) is broadly accepted by the industry as manageable. The Zambia Revenue Authority's approach to transfer pricing and withholding tax remains a compliance focus area for international operators.

Lycia's Advisory View

The Zambian copper sector represents a high-quality opportunity for investors with the expertise to navigate the operational and regulatory environment. Lycia's advisory practice covers licence acquisition, counterparty due diligence, offtake structuring and government relations for both established operators and new market entrants.