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First Quantum Minerals (TSX: FM) has shelved plans to sell a stake in its Zambian copper mines, chief operating officer Tristan Pascall said on Wednesday.

China’s Jiangxi Copper had been speculated as a potential suitor for minority interests in First Quantum’s Kansanshi and Sentinel mines.

First Quantum on Tuesday flagged rising costs on the back of higher Zambian royalty rates driven by increased copper prices.

“There has been limited progress” on talks with the Zambian government for terms which would pave the way for an expansion of ore processing at Kansanshi ahead of national elections, Pascall said.

Zambian President Edgar Lungu faces his most serious challenge yet from businessman and presidential hopeful Hakainde Hichilema in elections set for August 12.

Zambia’s ZCCM-IH sealed its acquisition of Mopani Copper Mines in March giving the state a deeper understanding of mine operations, Pascall said.

“We don’t see any significant risk there given where tax rates are at the moment,” he said.

First Quantum reported total copper production of 199,689 tonnes in Q2 2021, an increase of 18% from Q2 2020, due to near-record production at Cobre Panama of 81,686 tonnes, 276% higher than the same period in 2020.

Total gold production for the quarter was 81,375 ounces, a 49% increase from the same period in 2020, attributable to record production at Cobre Panama of 36,290 ounces and consistent delivery from Kansanshi of 32,942 ounces.

Nickel production at Ravensthorpe in Q2 was 4,543 tonnes. The company announced in May that it has entered into a binding agreement to sell a 30% equity interest in Ravensthorpe for $240 million to POSCO, one of the world’s leading integrated producers of materials for the electric vehicle sector.

(With files from Reuters)