The global economy is being rewired around “future metals.” Nickel, cobalt, lithium, and graphite have moved from obscure tables in geological surveys to boardroom agendas in Detroit, Berlin, Beijing, and Seoul. At the heart of this shift is the electric vehicle (EV), now a defining technology of the twenty-first century.
Tanzania has an ace in this game: the Kabanga nickel deposit in Ngara, Kagera. It is not simply one of the largest undeveloped nickel sulphide deposits in the world; it is also a test case for whether we can align geology, governance, and infrastructure to turn resources into leverage. The challenge is clear: either Kabanga remains an untapped story of “ore in the ground,” or it becomes the cornerstone of Tanzania’s industrial entry into the EV age.
What will decide the outcome is not geology, that part we already have, but whether we can move bulk efficiently and generate the power to process it. Without rail and reliable megawatts, Kabanga’s economy falls apart. With them, Tanzania has a once-in-a-generation chance to step onto the ladder of industrialisation that the EV transition makes possible.
Why nickel, why now?
Nickel is not just another mineral. It is the beating heart of high-density batteries, prized for its ability to store more energy in smaller volumes. Every additional percentage of nickel in a battery’s cathode translates into a longer range for EVs and higher efficiency for grids. That is why demand forecasts for nickel look so different from those for traditional metals; it is tethered to a structural transition, not a passing cycle.
For Tanzania, Kabanga comes with timing. As Europe legislates away the internal combustion engine, China pushes for supply security in its battery industry, and the United States launches subsidy-driven re-industrialization, the world is searching for a stable nickel supply outside the usual hubs. This is not just about price; it is also about geopolitics, the security of supply, and the resilience of value chains.
What makes Kabanga unusual is its potential to reposition Tanzania beyond its role as a raw-material supplier. Gold and tanzanite have generated royalties and export earnings, but they have not propelled us into the commanding heights of global industries. Nickel, however, sits at the centre of the green transition. If managed well, Kabanga is not just another mine; it is an invitation to play in the EV and energy storage value chain, and by extension, in the industrial policy of the twenty-first century.
But ambition without scaffolding is daydreaming. We must be brutally honest: between the drill rig and the EV showroom sits a long and unforgiving chain. Haulage contracts, wagons, and ports. Smelters, refineries, and megawatts. Standards, permits, and offtake agreements. This is where countries fall short. The real question for Tanzania is whether we can fill in those missing rungs before the EV supercycle passes us by.
From geology to economy: climbing the value-chain ladder
The path from resource to prosperity is a ladder with several rungs.
- Extraction: This is the visible part: machines arrive, jobs are created, and ore is lifted from the ground.
- Transport and concentration: Here, the costs begin to bite. Heavy ore must be moved hundreds of kilometres to port or processing hubs.
- Processing: This is where real value is captured: turning concentrate into refined metals or intermediates. It requires stable, affordable power and a base of skills and services.
- Market access: Contracts, logistics, and the ability to meet global standards determine whether refined products are successfully integrated into global supply chains.
Most African resource economies struggle to move beyond rungs two and three. Ore is too heavy for road transport, rail is either absent or unreliable, and power systems cannot guarantee a stable supply. The result is a forced retreat to exporting semi-processed or raw material. Margins are thin, spillovers are limited, and when prices fall, the fiscal pain is immediate.
For Kabanga, the danger is clear. Trucking nickel concentrate from Ngara to Dar es Salaam would be a logistical and economic nightmare. The tonnages are too high. Processing on site is technically possible, but only if power is secure, reliable, and affordable, not intermittent, expensive, or delayed. Without rail and power, Kabanga would default into the pattern that has trapped so many: exporting the least valuable form of the mineral while importing inflation, frustration, and missed opportunity.
There is also a subtle but crucial point: the difference between a project’s financial return and its economic return. Critics often ask whether the Standard Gauge Railway (SGR) will make a profit on its own books. That question misses the point. Railways are enablers; their actual value is realized through the economy. A train line that carries bulk ore cheaply extends the life of our roads, lowers costs for exporters, raises port efficiency, and makes processing projects bankable. Profit at the company level is less critical than competitiveness at the national level. If Kabanga can only move ore by truck, beneficiation will never be affordable; if it can move by rail, the economics change fundamentally.
And once processing is possible, the industrial spillovers multiply. Smelting and refining require engineers, electricians, suppliers of spares and reagents, environmental technicians, and financial services. Every successful rung climbed creates new skills and firms that endure beyond the life of one mine. This is the compounding effect Tanzania must seek from Kabanga.
The infrastructure bind: transport and power as gatekeepers.
Transport is the first binding constraint. Heavy ore, by the laws of physics and economics, belongs on rail. Trucks will always play a role, but it is in the last hundred kilometres, not the long haul across half the country. Trying to run Kabanga on trucking alone is like trying to irrigate fields with buckets when a canal is needed. The SGR, therefore, is not an optional extra; it is the artery without which the heart of Kabanga cannot beat.
Power is the second constraint, and perhaps the more decisive. Smelters cannot run on promises. Investors will not risk billions without assurance that hundreds of megawatts are available, continuously, and at tariffs that do not destroy margins. This is why the Julius Nyerere Hydropower Plant (JNHPP) is constantly mentioned in connection with Kabanga. If it delivers reliable capacity, it becomes the sinew that binds industrial dreams to reality. If it falters, Kabanga’s potential is reduced to moving rocks onto ships.
Timing compounds the problem. Mining projects, rail projects, and power plants each run on different clocks, and misalignment can be fatal. If the mine is ready but the rail is late, operating costs skyrocket and financing dries up. If the rail arrives but the power lags, processing plans are shelved and exports default to concentrates. The most significant risk is that delays in one sector shrink Kabanga into a smaller, less transformative scope: a mine that exports bulk ore, but never teaches Tanzania the skills or builds the industries that actual beneficiation demands.
The governance implications are sobering. Temptations will arise to pledge nickel as collateral for loans, but such shortcuts undermine property rights and frighten capital. The mineral is the investor’s asset; the state’s credibility rests on respecting that. Equally, secrecy erodes trust. When feasibility studies and project economics are withheld even from oversight institutions, suspicion is the only inevitable outcome. For Kabanga to succeed, transparency is not a luxury; it is the cheapest form of de-risking available.
Governance as the ultimate edge
History tells us that the most significant risk in mining is not geology but governance. Ore bodies are neutral; politics and policy decide whether they create prosperity or grievance.
For Kabanga, three governance challenges are particularly sharp.
The first is balance. Mining is a marriage of capital and sovereignty. International firms arrive with money, machinery, and technical skill; the state contributes the subsoil rights, legal framework, and often the critical infrastructure. If the balance tilts too far in favour of investors, the public perceives a sell-out. If it tilts too far towards the state, capital flees and projects stall. Kabanga will only endure if that balance is deliberately maintained.
The second is transparency. Investors are not the only constituency; citizens and communities must also be aware of what is happening. If feasibility studies, production forecasts, and fiscal terms are locked in drawers, suspicion will metastasize. Transparency is the most cost-effective form of insurance: it reduces political risk, reassures financiers, and enables citizens to see how national resources are being managed.
The third is policy coherence. A mine of Kabanga’s scale cannot be run in isolation. Its success depends on railways, power plants, ports, taxation rules, training institutions, and environmental enforcement. If each institution pursues its own agenda, contradictions pile up: power arrives late, rail tariffs are mismatched, and permits conflict. What appears to be a technical delay is often the result of poor coordination. Without coherence, even world-class ore can be stranded.
Lessons from Zambia: the copper cautionary tale
Across the border in Zambia lies a story Tanzania must heed. For decades, Zambia’s economy rose and fell on copper prices. At times, a quarter of GDP and nearly a third of government revenue came from a single metal. When prices spiked, revenues ballooned; when prices collapsed, budgets imploded. The nation became hostage to a seven-year commodity cycle it did not control.
The lesson is not that minerals are a curse, but that dependence is. If Kabanga is treated as the new “copper,” Tanzania will stumble into the same monoculture trap. The prize is not a nickel economy, but a diversified economy catalysed by nickel.
That means using Kabanga to stimulate rail networks that also serve agriculture, power generation that also serves manufacturing, and logistics corridors that also carry regional trade. It means ensuring that the metallurgists trained in smelters can later design steelworks or maintain power turbines. It means investing royalties into sovereign funds and social programmes that outlast the mine.
Kabanga should be a spark, but sparks only matter if they light other fires.
Corridor logic: scale through integration
No single mine can carry a railway, nor can it justify a hydropower plant by itself. Kabanga must therefore be viewed as part of a broader corridor strategy. The Central Corridor, running from Dar es Salaam through Dodoma into the Great Lakes, is the natural artery. If it functions well, Kabanga’s concentrates flow seamlessly to port. If it is mismanaged, costs soar and competitiveness dies.
But the corridor is not just about nickel. Burundi’s Msongati deposit and Rwanda’s transit trade add volume. So do agricultural bulks from the western highlands and manufactured goods for re-export. Every extra tonne lowers the cost per unit; every extra user strengthens the corridor’s economics.
This is where Tanzania’s geography is an advantage. Landlocked neighbours are hungry for access; global supply chains are hungry for secure sources of supply. If we position the Central Corridor as the most reliable route, efficient, transparent, and predictable, Kabanga becomes not just a mine but an anchor tenant in a multi-country logistics system.
The danger is the opposite: tariffs set too high, trains run inconsistently, and governance is fragmented. Then Kabanga is isolated, and the corridor is another expensive experiment. The difference between those two outcomes is not fate; it is management.
Communities and legitimacy
Even the best-designed rail and power systems mean little if communities on the ground feel alienated. In Ngara, where Kabanga lies, the questions are intimate: who will be compensated for land? Will youth be hired? Will water sources be protected?
Across Africa, mining projects have been derailed not by geology or finance, but by grievances that have been ignored. Communities that feel cheated block roads, lobby politicians, and escalate costs. Conversely, communities that feel respected are more likely to defend projects against disruption.
For Kabanga, legitimacy will stem from three key factors: fairness, opportunity, and effective communication. Fairness means transparent and timely compensation. Opportunity means building training ladders so that locals do not remain forever on the margins of employment. Communication means keeping people informed, rather than letting rumors fill the vacuum.
A mine of Kabanga’s size will reshape the district for decades. If handled well, it can leave behind skills, infrastructure, and pride. If mishandled, it will leave resentment and broken trust.
Strategic choices ahead
Kabanga confronts Tanzania with a more profound dilemma: the clash between short political cycles and long industrial cycles. Politicians operate in five-year increments; mines and railways operate in horizons of thirty years. The temptation will always be to seek quick wins: export the ore, book royalties, claim success. But that is to confuse movement with progress.
The more challenging path is the patient one: synchronizing rail and power commissioning with mine development, insisting on beneficiation even if early revenues appear modest, and investing in institutions that outlast administrations. It demands a politics that can resist the sugar rush of quick rents in favour of the compound interest of transformation.
This is not a purely technical question; it is a choice about national ambition. Do we want to be remembered as the generation that dug and shipped, or the generation that built and transformed?
Kabanga as a national test
Kabanga Nickel is not just a mineral project. It is a mirror held up to Tanzania’s capacity to govern, coordinate, and imagine. It asks whether we can turn world-class geology into world-class outcomes. It asks whether we can resist the monoculture trap, embed resources into corridors, and build legitimacy with communities.
If we succeed, Kabanga could become the hinge that swings Tanzania into the industries of the future: EVs, batteries, and advanced materials. If we fail, it will join the long list of African deposits that promised transformation but delivered disappointment.
Nickel is patient, but markets are not. The EV supercycle will not wait indefinitely. Other suppliers will rise. The choice is ours, to treat Kabanga as a quarry or to treat it as a pivot. To extract, or to transform. To play at the edges, or to seize the future.