Kagera all set to reap from Kabangas Nickel project
RESIDENTS in Kagera Region are eagerly awaiting opening of the Kabanga Nickel project, in Ngara District that would create labour and employment to many Tanzanians. At full capacity the mine is estimated to employ over 2,000 people.
Ngara is a strategic point, which borders four countries -- Rwanda, Burundi, Uganda and DRC and, therefore, starting nickel mining would greatly help transform the regions economy.
The presence of nickel puts the region at a vantage position due to the fact that when investment starts, a number of factories would also be put in place thus creating more employment opportunities.
Government would base on industrial economy by creating an investment-friendly environment that would attract investors from within and outside the country. The Kabanga Nickel is an active mine exploration project 130 km south west of Lake Victoria.
Barrick Gold and Xstrata now Glencore created the Kabanga Nickel joint venture in 2005 and there has been progress made with a significant investment to date of over US$250 million in drilling and evaluation studies.
The Kagera Regional Mining Development Officer, Mr Daniel Mapunda told the Daily News in an interview that implementation of the Kabanga Nickel project was delayed due to logistics problems,. We inspected the mining camp in April, this year.
The mining company is yet to complete some logistics including improvement of the infrastructure, he said without revealing when the exact drilling work will begin. Kabangas 58 million tonne nickel resource is regarded as one of the best undeveloped green field nickel sulphide deposits in the world.
In 2004, Barrick Gold formed a partnership with Canadian-based Falconbridgeon. In 2006, Falconbridge was acquired by Xstrata PLC of Switzerland, which was later acquired by Glencore Plc in 2013.
In June, a Tanzanian government delegation, while on a trip to Canada voiced their concern over the delays in the project to Glencore Chief Executive, Stephen Flewelling who revealed that they had put more than $250 million into the project and promised mining activities were likely to start between 2018 and 2020.
The pressure by the government is a result of non-fulfilled previous promises by the Kabanga investors. The investors had high hopes in the project. In February 2007 then Barricks partner, Xstrata Nickel, committed a further $95 million for pre-feasibility studies on top of the initial $50 million that they had spent on updating the resource model for the project.
Ian Pearce, then CEO of Xstrata Nickel and Greg Wilkins, then Barrick President and CEO had described Kabanga project as having the potential of becoming a world class nickel sulphide deposit.
Despite spending over $250 million in the project, Barrick Gold Corporation and Glencore Plc are reported to be seeking an investor on whom to offload the project. According to analysts, the investors have been frustrated by the falling price of nickel in the world market after the Chinese invented nickel pig iron.