Is Tanzania back as a graphite destination in 2023?
Nick Sundich, April 11, 2023
Tanzania has been a troublesome destination for ASX resources companies. Companies with projects there are still bearing the scars of the sudden changes to the Mining Code in 2017. But things are looking better nearly 6 years on.
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Tanzania’s reputation is shaky
The changes to the Mining Code in 2017 caused years of hell for virtually all the ASX companies with projects there.
Among other things, it mandated a mandatory 16% government stake in projects, banned unprocessed ores, prohibited disputes from being adjudicated in international courts and the power of the parliament to retrospectively reject or expunge terms in existing agreements considered to be unconscionable.
Then-President John Magufuli died in 2021 and was replaced by Samia Suluhu Hassan. Things have looked up for companies with projects in Tanzania ever since as the new administration sought to rebuild its reputation.
Progress is being made
This morning, two ASX companies with projects in Tanzania announced their invitation to a Framework Agreement Signing Ceremony for next Monday (April 17), i.e. Peak Rare Earths (ASX:PEK) and graphite play Evolution Energy Minerals (ASX:EV1).
Both companies gained at market open, although the former company was the stronger performer.
Peak Rare Earths (ASX:PEK) share price chart, log scale (Source: TradingView)
What about other long-suffering companies in Tanzania? If they sign formal agreements soon, shares might re-rate. Otherwise, the stagnation might continue.
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