Broken Hill Proprietary Company Limited (BHP) has invested in Kabanga Nickel Project in Ngara. The investment by the world's biggest miner comes as Tanzania rebuilds relations with the mining industry amid soaring global demand for nickel.
The investment into a dominant nickel license portfolio within the East African Nickel Belt of Tanzania marks a re-entry into Africa’s mining sector after BHP unbundled Perth-based metals miner South32 in 2015 which operates mines in South Africa and Australia. Kabanga’s deposit contains in-situ nickel equivalent resources estimated at 1.86 million tonnes. The first production is anticipated in 2025, targeting minimum annual nickel production of 65,000 tonnes during the estimated 30-plus years of the mine’s life.
At full capacity, Kabanga will also produce 4,000 tonnes per annum of cobalt, a metal produced as a by-product of nickel mining that is used in lithium-ion batteries and the manufacture of high-strength alloys. The project is a partnership with the Tanzanian government, which has a 16% interest through the local partnership entity Tembo Nickel Corporation. Kabanga was the first new major mining project to receive a mining license in a decade in Tanzania. Kabanga Nickel Limited is a UK-registered private company.
The price of nickel has climbed to $20,000 a tonne from less than $14,000 in January 2020 on the back of global demand for electric vehicle batteries.
Nickel prices are expected to reach new record highs by 2027, according to data released by Fitch Solutions, who expect a steady uptrend in prices from 2023-2027, which will then likely peak by the end of the period. However, they predict that prices should average lower this year at $17,000 per tonne compared to $18,400 per tonne in 2021. Global electric vehicle sales are forecast to grow more than 12-fold to 31.1 million by 2030 and account for nearly a third of new vehicle sales, according to Deloitte.