JAKARTA (TheInsiderStories) – Brazilian company joined with nickel miner, PT Vale Indonesia Tbk (IDX: INCO) collaborating build smelter in the country Indonesia with an investment US$5 billion, said the senior official today (10/15). Next, both parties will discuss the composition in the new company.
Vice president director of INCO, Febriany Eddy, said the investment funds will be used to develop two new smelters, and one existing smelter in Bahodopi, Morowali, Central Sulawesi) and Pomalaa, in Kolaka, Southeast Sulawesi.
Beside with Brazil, Vale Indonesia in talks with potential investor from China to build Bahodopi smelter. The discussion on going to decide who’s become the controlling shareholder in the joint venture company, said Eddy.
Bahodopi smelter will have output 700,000 tons per annum. Inline with the smelter development. She added, the company has pocketed exploration permit and now waiting for the exploitation permit and the contract extension.
While, smelter and mines in Pomalaa is estimating need investment $2.8 billion while projects in Bahodopi need costs up to $2.1 billion, including mines. As for expansion in the existing projects, Sorowako mining in East Luwu, South Sulawesi projected need funds $400 million.
“We hope that the permit can be obtained soon,” said the director.
Previously, President Director Vale Indonesia Niko Kanter has announced to invest $5 billion in nickel projects with its partners in the coming years, including $2.5 billion in battery-grade nickel plant projects with Japan’ Sumitomo Metal Mining Co. Ltd and China’ Qingshan Holding Group
INCO and Qingshan have teamed up to build a battery-grade nickel plant in Indonesia at a cost of $700 million with an annual nickel production capacity of 50,000 tons. Construction of the plant began in January and is expected to be completed within 16 to 18 months.
While with China’ Qingshan Holding Group have teamed up to build a battery-grade nickel plant in Indonesia at a cost of $700 million with an annual nickel production capacity of 50,000 tons. Construction of the plant began in January and is expected to be completed within 16 to 18 months.
At the se second quarter of 2019 (2Q), Vale has produced 17,631 metric tons of nickel in matte (t), 35 percent higher than production in 1Q, when planned maintenance activities were completed, said Kanter.
“We are optimistic of meeting our 2019 full year production target of approximately 73,000 t,” he added.
On a year-on-year basis, production in the 2Q of 2019 was about 7 percent lower than production in the same period in 2018. And, the production in 1H of 2019 was 15 percent lower than production in 1H of 201818.
This was basically due to a combination of planned maintenance activities related to the Larona Canal Relining, plant shutdowns and unplanned electric furnace issues in 2019.
Indonesia is rich in nickel deposits, about 3.5 billion wet tons, of which about 60 percent are low-grade laterite nickel deposits, the report said. There are currently six new high-pressure acid leaching (HPAL) plants around the world that can produce 220000 tons of battery-grade nickel a year, 70 percent of which are deployed in Indonesia.
Chinese companies have also seized the opportunity to develop the Indonesian nickel market, the report said.
President Joko Widodo’ government is planning to spend billions of dollars building aluminum and nickel smelters at home as it seeks to reshape the domestic mining industry and curb exports of raw materials while reducing its dependence on imports of finished metals.
This is because Indonesia’ own mining raw materials have been exported for decades, forcing the Southeast Asia biggest economy to rely on costly imports to meet demand.
Indonesia is likely to impose a ban on raw ore exports in 2022, pushing miners to process minerals at home. Under the 2017 mining regulations, Indonesia plans to suspend exports of raw ore on January 12, 2022, after giving miners five years to build smelters in the country.
It is expected that 41 smelters will operate in 2022, including 22 nickel smelters, 6 bauxite smelters, 4 iron ore smelters, 4 zinc smelters, 2 copper smelters, 2 anode slime smelters, and 1 manganese ore smelter.
by Linda Silaen, Email: firstname.lastname@example.org