Materials firm BHP has made an initial $40 million investment in mining firm Kabanga Nickel— part of Glencore— and recycling technology company Lifezone, with further investments to be agreed.
The investment is to accelerate development of the Kabanga Nickel Project mine that will produce Class 1 battery-grade nickel, cobalt and copper.
Plans for the mine include an enhanced metallurgical drilling programme to enable an update of the Definitive Feasibility Study and support the construction plans for the hydromet refinery.
These studies are expected to be completed by the end of this year, with the project timeline anticipating first production in 2025.
The firm is targeting minimum annual nickel equivalent production of 65,000 tonnes, with 30+ years life of mine and exploration upside potential.
Site and infrastructure development is already underway.
Further BHP funding in the pipeline include a second tranche of $50 million and the right for BHP to make further investment subject to achieving certain agreed milestones, and $10 million to progress Lifezone’s hydrometallurgical processing technology.
Kabanga is the largest development-ready nickel sulphide deposit in the world. Located in western Tanzania, it has contained in-situ nickel equivalent resources estimated at 1.86 million tonnes and an in-situ refinery to produce Class 1 battery-grade nickel, cobalt and copper.
The Government of Tanzania has a 16% interest through local partnership entity, Tembo Nickel Corporation, Kabanga Nickel Ltd (UK) holds the balance.
Investment in Kabanga Nickel
The first tranche of US$40 million will convert into an 8.9% equity stake in Kabanga Nickel (7.5% see-through interest in Tembo Nickel Corporation) once approvals and conditions are met.
Once invested, and on conversion, the second tranche of $50 million will increase BHP’s equity stake in Kabanga Nickel to 17.8% (15.0% see-through interest in Tembo), thereby valuing the project at $658 million post-money.
Lifezone aims to bring its technology to Full beneficiation of battery grade metals without smelting will be achieved in Tanzania.
Lifezone is the owner of the hydrometallurgical technology that will be used to build and operate a refinery in Tanzania.
The project promises to ensure that finished Class 1 battery grade nickel, copper and cobalt will be produced in Tanzania.
The investment into Lifezone allows for new patent applications as well as R&D work to further commercialise the firm’s hydrometallurgical technology.
The project development timeline anticipates first production in 2025.
Output will ramp up to target a minimum annual production of 40,000 tonnes of nickel, 6,000 tonnes of copper and 3,000 tonnes of cobalt.