African Rainbow Minerals (ARM) has entered into a conditional deal to supply nickel concentrate to a smelting facility run by Boliden AB, a step that could support the reopening of the dormant Nkomati mine in South Africa.
The agreement outlines that nickel concentrate from Nkomati would be transported to Boliden’s Harjavalta smelter in Finland over several years, according to Bloomberg. However, any restart of mining activities still depends on approval from ARM’s board, while Boliden is expected to complete its due diligence before finalising the arrangement.
Shut down since 2021, the Nkomati mine is the country’s only primary nickel asset. ARM secured full control of the operation last year after purchasing the remaining 50% stake from MMC Norilsk Nickel.
The company noted that the proposed offtake deal improves the viability of restarting the mine by ensuring a dependable market for future nickel production. The Harjavalta plant currently stands as Europe’s only major nickel smelting facility, positioning it as a key partner for ARM.
Gateway to the European market
Founded and largely owned by billionaire Patrice Motsepe, ARM operates across a range of commodities including coal, gold, manganese, iron ore, and platinum group metals. Meanwhile, Boliden produces several metals such as copper, zinc, nickel, and lead.
Specific financial terms of the deal were not made public, with ARM citing confidentiality clauses.
The announcement follows a recent legal outcome involving Motsepe’s wider business interests, after the Gauteng High Court ruling on African Rainbow Capital case determined that African Rainbow Capital is not liable in a $195 million (R3.2 billion) lawsuit filed by the U.S.-based Pula Group.