BHP Returns To Africa! $50 Million in Nickel Mines.

Australian mining giant BHP Billiton announced Monday that it will buy a stake in a nickel project in Tanzania owned by British mining company Kabanga, According to Financial Union.

It is understood THAT BHP will initially invest $40m in Kabanga's nickel mine for an 8.9 per cent stake, which will increase to 17.8 per cent with a further $50m investment, valuing the project at $658m. BHP also invested $10 million in Lifezone Limited, a hydrometallurgical technology company.

Kabanga said the site and infrastructure development had already begun, with the first production planned for 2025, with a minimum annual capacity of 40,000 tonnes of nickel, 6,000 tonnes of copper and 3,000 tonnes of cobalt. The project has the largest exploitable nickel sulfide deposit in the world. It is located in western Tanzania and contains an estimated nickel resource of 1.86 million tons with a nickel ore grade of 3.44%.

'The investment secures access to world-class nickel sulphide resources and is consistent with BHP's strategy of capturing opportunities in future-oriented commodities,' a BHP spokesman said.

BHP's investment will lead to the development of nickel mines in Tanzania, final feasibility studies and refinery construction plans to be completed by the end of the year, Kabanga said.

The investment marks a return to Africa for BHP, which sold the rights to develop an iron ore mine in Guinea, its last mining asset in the continent, in 2019. Since then, BHP has focused on Australia, Canada and Chile.

It is worth noting that BHP had planned to exit the nickel business and focus on other commodities. However, as BHP has set decarbonisation targets, it has identified nickel as one of its priorities.

Just last month, BHP lost out to Wyloo Metals, owned by billionaire Andrew Forrest, in a bid for Noront Resources, a Canadian nickel miner.