Glencore, Barrick set to sell Tanzanian nickel project
VENTURES AFRICA – Resources titans, Glencore and Barrick Gold are poised to dispose of their joint nickel expansion scheme in Tanzania, one of east Africa’s fastest-growing economies.
This is according to the Wall Street Journal (WSJ), which cited people familiar with the matter on Thursday.
It is believed that the disposal process may encounter problems because it is happening in the middle of instability in the price of nickel.
The Tanzanian asset is among many that have been disposed of in the past couple of years as mining companies reorganize their investment portfolios and raise funds to fix their beaten up balance sheets.
Ivan Glasenberg, Glencore CEO, has often said the company would not like to invest money in greenfields projects, adding these require bulky cash injections. The Toronto-based Barrick Gold is disposing of assets because it wants to shrink its debt by $3 billion before the close of this year, according to the WSJ.
The price of nickel continues to be unstable with some bankers claiming it could scare some investors from the Tanzanian asset.
Nickel has been surging in recent weeks. But it has slipped 5.3 percent this year and 31 percent down from highs touched last May. The two mining giants each own half of the Kabanga nickel project in northwest Tanzania.