TANZANIA – The government of Tanzania and UK-based mining firm Kabanga Nickel Limited have signed a framework agreement to jointly develop the Kabanga nickel project formerly owned by Barrick Gold and Glencore.
Tanzania’s Foreign minister Palamagamba Kabudi said during a signing ceremony in Bukoba that the government would own a 16% undiluted free-carried interest in the nickel project through a new joint venture company, Tembo Nickel Corporation, 84% owned by Kabanga Nickel.
By law, Tanzania’s government gets a 16% stake in all mining projects in the country.
Nickel is a key electric car battery material and Kabanga – in Tanzania’s northwest – is the world’s largest development-ready, high-grade nickel sulfide deposit, according to Kabanga Nickel.
It is estimated to contain more than 1.52 million tonnes of nickel.
Barrick Gold and Glencore lost the nickel project in 2018 when Tanzanian President John Magufuli’s administration revoked their retention licence along with 10 others as part of new mining laws and regulations.
“It is estimated Kabanga mine contain more than 1.52 million tonnes of nickel”
Kabanga Nickel, which was previously called LZ Nickel, said it has agreed with Barrick and Glencore to acquire all the project data and information from them, including a 2014 draft feasibility study report and subsequent updates.
As well as starting the mine, Kabudi said Kabanga Nickel is required to build a nickel smelter which can also smelt other metals such copper and gold.
Kabanga Nickel said Tembo would produce Class 1 nickel and cobalt products, and LME Grade A copper cathode with the mine estimated to contain more than 100,000 tonnes of cobalt – also used in batteries.
“A smelter will be constructed in Kahama district, Shinyanga region not only to refine nickel but other minerals like copper and kobellite. This will also produce employment and thus improve the lives of Tanzanians’ said the minister.
Krisfone Prisfone, the vice-chairman of LZ Nickel Limited said the signing of the framework agreement establishing Tembo Nickel Company is a milestone for Tanzania and East Africa region as the production of refined nickel, copper and kobellite products is a new sphere in the global economy.
“I welcome Tembo Nickel Co and I can assure you that our team represents significant capability and rich experience as we have been doing these activities for over 40 years” he stated.
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