The state-owned miner, PT Aneka Tambang Tbk (IDX: ANTM) is reportedly planning to increase its ownership in a nickel producer, PT Weda Bay Nickel, from 10 percent to 40 percent - Photo by the Company

JAKARTA (TheInsiderStories) – The state-owned miner, PT Aneka Tambang Tbk (IDX: ANTM) is reportedly planning to increase its ownership in a nickel producer, PT Weda Bay Nickel, from 10 percent to 40 percent with estimating costs US$300 million. The company not confirmed the planned but admitted open for an opportunities to expanding their downstream projects.

“In principle, ANTAM focus to expand downstream mineral processing, which provides positive added value as well as expanding the reserve and resource base,” SVP corporate secretary, Kunto Hendrapawoko, told TheInsiderStories, on Monday (26/10).

Until 2019, ANTAM‘ nickel ore reserves were recorded at 353.74 million wmt with nickel ore resources reaching 1.36 billion wmt. He said, the potential reserves and resources are one of the strengths of the issuer’ to expand the downstream nickel businesses. The company, is also open to forming partnerships with strategic partners, especially who have access to technology and funding to develop the new processed minerals, he adds.

Currently, French mining company, Eramet Group, together with a steel producer from China, Tsingshan Holding Group Co., controls 90 percent of Weda Bay shares, and the remaining owned by ANTAM. In detail, Eramet hold 43 percent of the miner shares and Tsingshan owned 57 percent.

Weda Bay is the owner of a nickel ore refining project using pyrometallurgical technology. The factory is located in the Weda Bay industrial area, Central Halmahera, North Maluku. The company started the mining operations in October 2019 and has as much as 9.3 million tones of nickel. Its expected, the block to produce 30,000 metric tones per annum starting 2021.

While, ANTAM has several joint ventures including Weda Bay Nickel (10 percent), PT Antam Niterra Haltim (30 percent), PT Sorikmas Mining 25 percent, PT Galuh Cempaka 20 percent, PT Gorontalo Minerals 20 percent, and PT Sumbawa MInerals 20 percent. The miner, PT Perusahan Listrik Negara (PLN), and PT Pertamina just announced to form a new venture company called Indonesia Battery Holding to operates an electric vehicle (EV) battery plant.

“In the upstream there is ANTAM, the intermediate one is Pertamina, and downstream there is PLN” said CEO of PT Indonesia Asahan Aluminium (MIND ID), Orias Petrus Moedak, in a virtual discussion on Oct. 13.

The former deputy director of PT Freeport Indonesia, stated, currently there are two potential partners from China and South Korea who are being approached to become and investors in the new EV battery factory. He said, the investment values of this project was estimated around US$12 billion.

To support the planned, said the CEO, ANTAM now worked on related EV battery like high-pressure acid leaching and rotary kiln electric furnace smelter projects valued $2 billion to $3 billion, respectively. But, he did not give the details on the two projects.

Previously, minister of state own enterprises, Erick Thohir, revealed, after MIND ID’ purchase PT Vale Indonesia Tbk (IDX: INCO) shares with worth of Rp5.5 trillion ($374.15 million), the new unit its expecting would support the downstream projects of the holding mining company. With the share ownership, will allow MIND ID to secure the supply of raw materials, especially nickel.

He emphasized that since the government banned nickel exports as of Jan. 1, 2020, MIND ID has been faced with a challenges to innovate and restructure the business models. Based on the reasoned, now the ministry prepare this company to enter the EV battery industry, which currently 27.9 percent of the market share controlled by China.

Indonesia, he asserted, only became a producer and exporter of raw goods with a share of 27 percent in the global market. The plan will be executed with the construction of a lithium-ion factory which is planned to be near two nickel mines owned by ANTAM in Tanjung Buli, East Halmahera and in North Konawe, Southeast Sulawesi.

MIND ID is currently managed ANTAM, INCO, PT Bukit Asam Tbk (IDX:PTBA), PT Timah Tbk (IDX: TINS), and Freeport Indonesia.

US$1: Rp14,700

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