A US Backed Nickel Investment has moved a step closer after Lifezone Metals selected a preferred strategic partner to support development of the Kabanga Nickel Project in Tanzania. The proposed investment is expected to accelerate financing for one of Africa’s largest undeveloped nickel sulphide deposits while supporting efforts to diversify global critical mineral supply chains.
According to people familiar with the matter, Lifezone has identified Orion CMC as its preferred investment partner following a competitive selection process. The consortium, established in October with sovereign backing from the US International Development Finance Corporation (DFC) and Abu Dhabi’s L’imad Holding, was created to support strategic critical minerals investments worldwide.
Preferred Investor Selected to Advance Project
The US Backed Nickel Investment represents a significant milestone for the Kabanga project, which Lifezone aims to develop into a large underground mining operation. The company has been seeking an equity partner to help finance construction of the mine as it progresses towards a final investment decision.
Lifezone Chief Executive Officer Chris Showalter said on 29 July that the company had selected a preferred partner from several offers to make a strategic equity investment in the project. He added that negotiations had entered the final phase following a competitive process managed by Standard Chartered.
While the company did not identify the preferred investor publicly, people familiar with the discussions said Orion CMC had been selected. The size of the proposed investment has not been disclosed, and Lifezone declined to comment on market speculation.
Lifezone estimates the Kabanga project will require approximately US$940 million in development capital. Once operational, the mine is expected to produce around 350,000 tonnes of nickel concentrate annually, alongside copper and cobalt concentrates. A planned second-phase refinery would produce higher-value nickel sulphate for export.
Critical Minerals Strategy Drives Investment
The US Backed Nickel Investment reflects broader efforts by the United States to strengthen access to critical minerals required for manufacturing, clean energy technologies and electric vehicle supply chains while reducing reliance on concentrated sources of supply.
Indonesia currently accounts for around 60 per cent of global nickel production following significant investment in processing capacity after the country’s ban on raw nickel ore exports. Against this backdrop, projects such as Kabanga have become increasingly important as governments seek to diversify global supply.
The DFC has played an active role in supporting the project since 2024, when it began due diligence on political risk insurance and explored potential financing options. In June, the agency announced it would expand its investment in Orion CMC to improve access to critical minerals and reduce dependence on concentrated supply sources, although it did not disclose additional funding amounts.
Orion CMC’s portfolio also includes a preliminary agreement announced earlier this year to acquire a 40 per cent interest in two copper-cobalt mining operations in the Democratic Republic of Congo. That transaction has yet to be completed.
Project Moves Towards Final Investment Decision
The US Backed Nickel Investment comes as Lifezone continues preparations for a final investment decision, which the company expects to reach early next year. Alongside securing an equity partner, the company has appointed Société Générale to arrange debt financing for the project.
Negotiations with the Tanzanian government have taken longer than initially anticipated. The government holds a 16 per cent interest in the Kabanga project and has identified critical minerals as an important area for future mining sector growth.
Lifezone began searching for a strategic investor after BHP ended its option to acquire control of the project and sold its minority interest in Kabanga about a year ago.
If completed, the US Backed Nickel Investment would represent one of Orion CMC’s first major mining investments and provide additional momentum for development of one of Africa’s most significant undeveloped nickel projects, bringing the Kabanga mine closer to construction and future production.