Lifezone Metals Limited in partnership with BHP have announced the commencement of the project financing process for the Kabanga Nickel Project in Tanzania, which the government owns 16 percent share.

Lifezone Chief Executive Officer, Chris Showalter announced yesterday in a statement that the company has received a Letter of Interest from the US International Development Finance Corporation (DFC) that expressed DFC's interest in considering the Project for loans as part of the Project's financing package.

Showalter also commented: "The initiation of the project financing process with Societe Generale is a crucial next step in securing the funding required for Kabanga, and is yet another indicator of the strategic importance of the Project to our global partners. With DFC's interest in supporting Kabanga, the US government clearly recognizes the critical role that sustainable mineral development in Africa plays in the global energy transition. Today's announcement reinforces this vision and again highlights the strong relationship between the United States and Tanzania."

DFC is America's development finance institution. It partners with the private sector to finance solutions to the most critical challenges facing the developing world today across sectors including energy, infrastructure, healthcare, agriculture, and financial services. 

DFC investments adhere to high standards and respect the environment, human rights, and worker rights.

Minister of Minerals, Anthony Mavunde, welcomed the news, saying: "The Kabanga Nickel Project is a model example of the Government of Tanzania's commitment to fostering sustainable development and economic growth for the benefit of Tanzania and Tanzanians. We are delighted with the announcement that DFC has signed a Letter of Interest for project finance of Kabanga. Building on the 2023 visit to Tanzania by Vice President Harris, DFC's action shows that Tanzania and the United States continue to develop a strong economic partnership founded on a shared vision for sustainable development and we are looking forward to further developing our relationship to pursue our common goals.”

Mavunde said this project will not only boost the country’s economy regionally and nationally, but also position Tanzania as a leading international player in the global nickel market, contributing significantly to the global energy transition.

Scott Nathan, Chief Executive Officer of DFC added: "DFC is helping to advance the global energy transition through projects that drive sustainable development and economic growth. The Kabanga Nickel Project represents a significant opportunity to advance responsible mineral development in Tanzania, diversifying critical supply chains and fostering economic resilience in the region."

The DFC loan application would initiate a comprehensive review process; this follows Lifezone's August 27, 2024 announcement that DFC would be evaluating political risk insurance coverage for future investments in Kabanga.

Kabanga is one of the world's largest and highest-grade undeveloped nickel sulfide deposits. By utilizing Lifezone's Hydromet technology, the project is expected to significantly reduce emissions compared to traditional smelting methods.

Kabanga is supported by the Partnership of Global Infrastructure and Investment (PGI), which is a values-driven, high-impact, and transparent infrastructure partnership that was created to meet the enormous infrastructure needs of low- and middle-income countries and to support the United States' and its allies' economic and national security interests. 

Kabanga is also recognized as a project within the Minerals Security Partnership, a collaboration of 14 countries and the EU to catalyze public and private investment in responsible critical minerals supply chains globally.

Also, Societe Generale has been appointed as the lead financial advisor to Kabanga Nickel Limited, a subsidiary of Lifezone that is managed by Lifezone and in which BHP has a 17 percent interest.

Lenaig Trenaux, Global Head of Batteries, Mining and Industries, Societe Generale, commented: "Societe Generale supports its clients in the energy transition, through dedicated solutions, and a commitment to contribute to sustainable finance. We are very pleased to be working jointly with Lifezone Metals and BHP to deliver the Kabanga Nickel Project, aiming to foster development in Tanzania and feed the energy transition with a large volume of low carbon critical mineral."

Societe Generale brings world-leading expertise in large-scale debt financing for mining projects globally. In cooperation with BHP, Lifezone and Societe Generale will look to optimize Kabanga's capital structure through a combination of multi-source project-level debt and equity.