The firms are to mine minerals used in the production of magnets and lithium-ion batteries as the West seeks to cut its dependence on China
The Tanzanian government on Monday signed contracts worth US$667 million with three Australian companies to mine for graphite and rare earths.
The framework agreements are part of a push by Tanzanian President Samia Suluhu Hassan to boost the mining sector’s contribution to Tanzania’s economy to at least 10 percent by 2025.
The deals were signed at a ceremony in the capital, Dodoma, with Evolution Energy Minerals Ltd, EcoGraf Ltd and Peak Rare Earths Ltd.
“It’s the hope of Tanzanians that the implementation of these projects will start soon and contribute to the economy,” Hassan said.
Tanzania would have a 16 percent stake in each of the projects, according to the head of the government’s negotiating team Palamagamba Kabudi.
Western nations are looking to reduce their dependence on China for rare earths — 17 heavy metals that are crucial for electronics such as smartphones, computers and batteries, as well as the cutting-edge technologies, that could reduce reliance on fossil fuels.
Peak Rare Earths is involved in the US$439 million Ngualla rare earths project in southwestern Tanzania.
It said Ngualla is one of the world’s largest and highest-grade deposits of neodymium and praseodymium, key components of high-strength permanent magnets used in the production of electric vehicles and wind turbines.
“This signals the long journey of partnership between Peak and the government of Tanzania in developing a world-class project,” executive chairman Russell Scrimshaw said. “Our project will play a role in addressing climate change.”
Evolution Minerals and EcoGraf are to mine for graphite — which is used in lithium-ion batteries — in projects worth US$100 million and US$128 million respectively, Kabudi said.
“The signing of these agreements today sends a positive message to the global mining sector,” Evolution managing director Phil Hoskins said.
Mining made up 7.3 percent of Tanzania’s economy in 2021, up from 4.8 percent in 2018, Mining Commission Executive Secretary Yahya Samamba has said.
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