BHP betting on Nickel
Friday, January 14th, 2022
A Tanzanian nickel project has become the subject of the first new bet in Africa by BHP, the world’s biggest mining company, in recent years.
Kabanga Nickel, a British-based private company, said that the $40 million injected by BHP would be used “to accelerate the development of the Kabanga nickel project in Tanzania, the world’s largest development-ready nickel sulphide deposit”.
The FTSE 100 Anglo-Australian group has not been active in Africa since it spun off South32 in 2015, but Mike Henry, 55, its chief executive, has signalled a new willingness to venture into “tougher jurisdictions”.
Kabanga, which expects to start producing in 2025, is aiming for a minimum annual output of 40,000 tonnes of nickel, 6,000 tonnes of copper and 3,000 tonnes of cobalt.
Future investment tranches in Kabanga Nickel have been agreed subject to certain conditions, including a second tranche of US$50 million and the right for BHP to make further investment subject to achieving certain agreed milestones.
Chris Showalter, Kabanga Nickel CEO, said: “We are delighted to announce this partnership with BHP. It highlights the world-class nature of the Kabanga deposit and its importance in helping meet the crucial decarbonisation challenge facing the world today. BHP is the ideal partner for Kabanga Nickel, bringing significant advantages and expertise that will enable us to move ahead with the project
The project will be a cradle-to-gate mining operation producing Class 1 nickel, cobalt and copper refined metals in Tanzania by adopting a hydrometallurgical processing technology that is more cost efficient than smelting and has a significantly lower environmental impact.