Zambia's mining industry is expected to maintain steady growth in 2006 due to increased investor confidence in the industry, PricewaterhouseCoopers said in a report seen by Dow Jones Newswires Tuesday.

According to the report, Zambia's mining industry registered a strong performance in 2005 due to improved commodity prices on the world market, registering a net aggregate profit of up to $45 billion, compared with $28 billion the previous year.

The report added the good performance in the industry prompted mining companies to return $16 billion to shareholders in 2005 through further distribution and buybacks.

Zambia's mining industry, dominated by copper, the country's leading foreign revenue earner, is on a path to recovery after years of unimpressive performance. Improved world metal prices have encouraged mining companies like London-listed Vedanta Resources PLC to move in to acquire Konkola Copper Mines, the country's leading producer. Vedanta is currently developing a $400 million deep mine project in Zambia.

According to the Zambia Chamber of Mines, investment in the mining industry since 2003 is expected to reach $2 billion by the end of 2006.

Copper output is expected to reach 750,000 metric tons next year. A new mining frontier is being developed in the north western province of Zambia, where Australia-based Equinox Minerals Ltd. is developing what will be the country's biggest copper mine, due to come on stream around late 2007 or early 2008.

Mining in other minerals is also in high gear. According to Stephen Mukuka, Zambia's deputy minister in charge of Mines and Minerals development, nickel mining will start at Munali Hills in 2007.

Zambia is also consulting with the International Atomic Energy Agency to develop a policy that will pave way for uranium mining.