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Tanzania signs rare earths deals with Australian firms

The Tanzanian government on Monday signed contracts worth $667 million (610 million euros) with three Australian companies to mine for graphite and rare earths.

The framework agreements are part of a push by 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, EcoGraf Ltd and Peak Rare Earths.

“It’s the hope of Tanzanians that the implementation of these projects will start soon and contribute to the economy,” Hassan said.

Tanzania will 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 which 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 $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 the partnership between Peak and the government of Tanzania in developing a world class project,” said the company’s executive chairman Russell Scrimshaw.

“Our project will play a role in addressing climate change.”

Evolution Minerals and EcoGraf will mine for graphite — which is used in lithium-ion batteries — in projects worth $100 million and $128 million respectively, Kabudi said.

“The signing of these agreements today sends a positive message to the global mining sector,” said Evolution managing director Phil Hoskins.

Mining contributed 7.3 percent of Tanzania’s economy in 2021, up from 4.8 percent in 2018, Mining Commission executive secretary Yahya Samamba said in October last year.

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