By Chris Mfula
LUSAKA (Reuters) - Glencore (L:GLEN) has rescinded its earlier decision to shutter its Zambia subsidiary Mopani Copper Mines (MCM) from April 8, Zambia's mines ministry said on Monday following a video conference with Glencore executives.
Instead, MCM will inform the Director of Mines of its intention to place its two mining operations on care and maintenance in 90 days, while still in dialogue with Zambia's government on possible solutions, the ministry said in a statement.
The mining firm's announcement had sparked a backlash from the government, which said Glencore did not give it sufficient notice of the shutdown, and threatened to revoke MCM's mining licences.
"The Government applauded the gesture of goodwill from Glencore to rescind its earlier decision and opting for dialogue," the ministry said.
A Glencore spokesman declined to comment.
MCM must give the government a "detailed plan" on how it intends to proceed in the 90-day period and "possibly" beyond, the ministry said, adding that MCM would defer some non-production activities and cut capital expenditure in order to unlock cashflow.
The ministry also said MCM must restructure its cost profile in order to become profitable and start paying corporate income tax.
Charles Sakanya, chief engineer at MCM, has been appointed acting CEO after the government allowed CEO Nathan Bullock to leave the country, the ministry added. Bullock had been briefly detained at Lusaka airport on April 15.