US-backed Orion eyes stake in giant Tanzania nickel mine
A deal would help Lifezone finance the $940 million Kabanga project and advance US efforts to secure critical minerals.
US-backed Orion CMC, a consortium supported by the US government, has emerged as the favored partner for Lifezone Metals to develop Tanzania's Kabanga nickel project. This potential investment could mark one of Orion's initial major critical minerals ventures. The decision, made after a competitive bidding process led by Standard Chartered Plc, has not been officially confirmed by either Lifezone or Orion.
Lifezone's CEO, Chris Showalter, mentioned during a recent earnings call that the selection process was thorough and competitive, though he did not disclose the identity of the preferred bidder. Showalter stated that discussions with Orion CMC are nearing their final stages.
The Kabanga project, one of the world's largest high-grade nickel sulphide deposits, is expected to cost approximately $940 million to construct and generate around 350,000 tonnes of nickel concentrate annually, along with copper and cobalt. Lifezone anticipates that a subsequent refinery phase will produce a more valuable nickel sulphate.
Société Générale SA has been tasked with arranging the necessary project debt. The company aims to make a final investment decision early next year, following extended negotiations with the Tanzanian government.
Tanzania holds a 16% ownership stake in the project. Lifezone Metals filled the void left by BHP's withdrawal from the Kabanga option, which had intended to take control and later sold its minority interest. Lifezone initiated its search for an equity partner about a year ago, after BHP exited the project.
Tanzania is the world's largest producer of nickel, accounting for about 60% of global production. This figure rose after China's increased involvement in the sector following Jakarta's 2020 ban on raw ore exports. Orion CMC has previously shown interest in the Democratic Republic of Congo's copper-cobalt mines, although the deal has yet to be finalized.
The Democratic Republic of Congo recently increased its investment in Orion CMC to bolster US and allied access to critical minerals and lessen dependence on concentrated sources. Orion Resource Partners did not respond to comments, and the Democratic Republic of Congo's stance was not available for comment. The Democratic Republic of Congo has shown interest in Kabanga since at least 2024, engaging in due diligence for political risk insurance and expressing willingness to provide project financing.
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