BHP Group has invested $40 million in a Tanzania nickel property, according to Kabanga Nickel, a UK-based private firm. This is the world’s largest miner’s first new bet in Africa in years.
BHP has not been active in Africa since the 2015 spin-off of South32, although CEO Mike Henry has expressed a desire to enter into “tougher areas.”
Kabanga hopes to begin production in 2025 and aims to produce a minimum of 40,000 tons of nickel, 6,000 tons of copper, and 3,000 tons of cobalt per year. Nickel, a vital component in electric vehicle batteries, is expected to see an increase in demand.
A BHP spokeswoman said, “This investment ensures access to a world-class nickel sulphide resource and is aligned with BHP’s strategy to exploit opportunities in future-facing commodities.”
In a bid to buy Canadian nickel producer Noront Resources Ltd, BHP was defeated by billionaire Andrew Forrest’s Wyloo Metals last month.
BHP’s investment, according to Kabanga, will speed up the mine’s development, with a comprehensive feasibility study and refinery construction plans expected to be completed by the end of the year.
BHP also put $10 million into Lifezone Limited, a hydrometallurgical technology company. The hydromet technology, which Kabanga plans to utilize in its refinery, offers a greener alternative to energy-intensive smelting, according to Kabanga.
Kabanga stated in a statement that BHP’s investment will give it an 8.9% interest in the company after criteria are completed. BHP plans to invest another $50 million, bringing its interest in the project to 17.8% and valuing it at $658 million.
Kabanga’s proposal to produce metal in Tanzania aligns with Tanzania’s desire to increase the value of its minerals. Tanzania wants to become “an important centre for essential decarbonisation minerals,” according to Mines Minister Doto Biteko.
