The nickel project in Tanzania will be developed through a joint venture, which will be owned 84% by Kabanga Nickel
The Kabanga nickel project would need no additional exploration for its development. (Credit: Khusen Rustamov from Pixabay)
Kabanga Nickel (formerly LZ Nickel) has entered into a framework agreement with the Tanzanian government to develop the Kabanga nickel project in the African country by forming a new joint venture called Tembo Mining.
As per the terms of the agreement, the UK-based mining company will hold an 84% stake in the joint venture, while the Tanzanian government will own the remaining 16% stake.
The Kabanga nickel project is located in the Ngara District in Kagera Region, northwest Tanzania. It is a development-ready, high-grade nickel sulphide deposit with an estimated mineral resource of nearly two million tonnes of contained nickel equivalent.
According to Kabanga Nickel, the agreement with the government confirms the conditions of a special mining license to be granted to their joint venture along with a refining license, and the applicable commercial terms.
The company stated: “Fundamental to the Framework Agreement is a partnership model that incorporates an equitable sharing of economic benefits arising from the project.”
The Kabanga nickel project was previously owned by mining majors Barrick Gold and Glencore. In May 2018, the companies lost the project due to the cancellation of their retention mining licenses by the government as part of its new mining regulations.
Kabanga Nickel said that it has executed an agreement with Barrick Gold and Glencore.
Under the terms of the agreement, the company has exclusively acquired all data and information associated with the past mineral resource estimation along with all metallurgical test work and piloting data, analysis, and studies. These include a comprehensive draft feasibility study report that was published in 2014 and subsequent updates, said the UK-based miner.
The company revealed that the mine’s previous owners had spent more than $290m on it between 2005 and 2014 besides carrying out 587,000m of drilling.
The Kabanga nickel project needs no further exploration for its development and for entering into production, said the company.