One of the most recognized mining companies, BHP, reportedly plans to invest a huge amount in a prominent nickel project in Tanzania. It intends to access minerals and metals required to electrify the global economy.
The decision for investing $100 million in remote British miner Kabanga Nickel, which is perceived to be developing the project, is said to be an additional alteration in the BHP strategy as it has normally focused on lower-risk mining regions such as Chile, Australia and Canada, which have been developed at a massive scale.
Notably, this move also acknowledges BHP, which sold its assets in Africa in 2019, that for accessing the best-untouched mineral deposit, it is a must to operate in more challenging parts of the globe and partner with smaller organizations.
At present, Kabanga is one of the largest ready-to-develop deposits of high-quality nickel sulfide in the world. However, the place is located in a remote place in the northwest of the country, near the borders of Burundi and Rwanda and is known to lack the required infrastructure.
Previously, it was owned by Canadian mining company Barrick Gold and commodities group Glencore who sold the project after being barred of their holding license in 2018 by John Magufuli, Former Tanzanian President, who announced new mining laws.
Kabanga Nickel, the project's new owner, anticipates the first production in 2025 and quotes that the deposit possesses resources for producing high-quality nickel of around 40,000 tons per year for more than 30 years. It will also produce 4000 tons of another battery metal cobalt.
The global nickel market, which is 2.7 million tons per year, is estimated to grow massively due to the rising popularity of EVs (electric vehicles).
Speculations have it that the demand for the metal used in more powerful electric car batteries is estimated to grow 19 times by the end of 2040 if the world reaches the Paris climate goals.