Kabanga camp.
Drillcore showing nickel sulphide mineralisation from Kabanga.
through the Strait of Hormuz before travelling to Indonesia. As a result of the conflict in the Middle East this year, sulphur supplies were disrupted, sharply raising costs for Indonesia’s nickel producers. HPAL producers in Indonesia, which had been at the bottom of the cost curve, were forced to cut production by up to 50%. All this put together has improved the outlook for nickel prices substantially. This year’s landslide at the Morowali industrial park is a further case in point. In February 2026, a landslide hit a mine waste zone at a nickel processing hub managed by PT Indonesia Morowali Industrial Park, the largest nickel-processing hub in Indonesia, sweeping away excavators and bulldozers and killing one contractor. IMIP halted operations at the site while authorities investigated. It was not an isolated incident and the same tailings area had suffered a fatal landslide the previous year. A single site, built to process a large portion of the world’s nickel supply, has produced a recurring pattern of failures capable of halting output that manufacturers thousands of miles away have no alternative source for. As such, there is a great need to diversify nickel supply away from Indonesia to other countries and suppliers to reduce these risks. High-grade nickel deposits exist outside Indonesia. Financing and long development timelines remain the real barrier, not geology. Take the Kabanga Nickel project in Tanzania, owned by Lifezone Metals. The Kabanga Project comprises one of the world’s largest and highest-grade nickel sulphide deposits with 2.7 billion pounds worth of contained nickel equivalent metal in Measured and Indicated Resource at a grade of more than 2%, plus by-products. More than $400 million has already been invested in the project and the final investment decision is expected in the first quarter of 2027. Kabanga shows that world-class, cost-competitive nickel supply outside Indonesia is possible in partnership with its host country. Governments are increasingly backing the shift to diversify supply with policy and capital. The US-led Forum on Resource
First ever nickel, copper and cobalt refined metals produced by Hydromet from Kabanga source material at Lifezone’s laboratory in Perth, Australia.
Drillcore showing nickel sulphide mineralisation from Kabanga.
Geostrategic Engagement (FORGE), which brings together dozens of partner countries, aims to fund and facilitate project development to promote critical mineral supply chain security and diversification. In addition, earlier this month, the White House convened executives from across the US critical minerals industry and President Donald Trump recently unveiled $3 billion in new critical minerals investment. The diversification of nickel supply needs to be seen as an urgent priority. Diversified, Western-backed nickel supply will give manufacturers and governments greater supply chain resilience. The sooner that nickel diversification happens, the less exposed the world will be to the next shock in Jakarta or in the Strait of Hormuz. n
OCTOBER 2026 | www.modernminingmagazine.co.za MODERN MINING 11
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