Tanzania mining industry set for big boost in 2016

by Ina King (Potgieter)

The Tanzanian mining industry is set for a big boost in the latter half of 2016, with construction of the Mchuchuma coal and Liganga iron ore projects in Tanzania’s Mbeya Region, set to commence. Finance and implementation is via Tanzania China International Mineral Resources Ltd (TCIMRL), a joint venture between the Tanzania’s National Development Corporation (NDC) and Chinese company, Sichuan Hongda Group.

Tanzania’s Minister for Industries, Trade and Investment, Charles Mwijage made the announcement in May 2016.

About US $ 3 billion will be spent on both projects, with start-up capital of US $ 600 million from Sichuan Hongda Group, leaving the debt finance standing at US $ 2.4 billion. This is the largest single industrial investment since Tanzania gained independence in 1961, according to the country’s government. It will involve construction of an iron plant, with the capacity to produce one million tonnes per year, and a 600 MW power plant. 250 MW from this plant will be consumed by the plant itself and the remaining 350 MW fed into national grid.

 These projects form part of the Africa Mining IQ database of over 1 850 African mining projects, where we supply key mining intelligence, including [primary] contact details for project engineers and developers, on each project.. These projects are organised in terms of their mine lifecycle: grassroots, pre-feasibility, feasibility, bankable, active and operational phases.

According to Mwijage, a substantial sum of money has already been set aside to compensate inhabitants living around the mining project area. He said that once this process is complete the next step, which involves setting up of the plants, would commence.

We monitor progress on these developments daily, with regular updates posted on the Africa Mining IQ intelligence portal. Companies subscribing to Africa Mining IQ’s e-mail alerts will be among the first to know about new developments, completed expansions and definitive production expectations, when they are announced.

Aiming high and creating jobs

Tanzania's stake in the combined project is currently 20%, with the remaining 80% owned by Sichuan Hongda Group. However, Mwijage said that it is government’s intention to increase its stake to 49% in due course. In addition to Tanzania becoming the third largest iron producer in Africa as a result of these plants’ development, they will also generate approximately 32 000 jobs.

With over 1 850 projects in Africa currently listed on its online database, Africa Mining IQ covers extensive listings on the continent’s prominent minerals, and is used by over 170 companies to grow their operations across the continent. A subscription to Africa Mining IQ provides members with the ability to track, target and record these mining projects with accurate, holistic information that is updated daily and accessible 24/7, 365 days a year.

Explorations conducted at the Mchuchuma and Liganga projects have confirmed that the coal and iron ore deposits will be mined for more than 100 years.

Mining in Tanzania projects listed on Mining IQ’s database currently profiles 24 projects. Minerals mined in these projects include 3 Coal, 9 Gold, 2 Graphite, 4 Industrial, 1 Iron Ore, 2 Nickel, 1 Phosphate, 1 Tantalum/Tantalite and 1 Uranium.