Indonesian coal company PT Harum Energy is strategically transitioning its business focus towards nickel mining, in preparation for the global shift towards cleaner energy sources. President Director Ray Antonio Gunara revealed in a recent interview that the company is halting further investments in its coal operations to maintain only the current production levels. Instead, Harum Energy is actively seeking to expand its presence in the nickel sector, which is crucial for electric vehicle (EV) batteries.
Harum Energy has already acquired stakes in three nickel processing plants and is considering an initial public offering for this unit when market conditions become favorable. The company anticipates that nickel will constitute half of its revenue by the end of this year, a significant increase from just over 10% in 2023.
Gunara expressed a cautious perspective on the coal sector, noting that public markets do not favor coal mining businesses despite their profitability, prompting the firm’s pivot away from expanding coal production capacity. This strategic shift comes amid Indonesia’s rising prominence in the global nickel market, propelled by a substantial $30 billion investment from Chinese companies in local smelters. However, Gunara acknowledged the challenges in acquiring nickel assets due to high costs and scarcity of large deposits.
Last week, Harum Energy announced a partnership with China’s Tsingshan Holding Group, a leading global producer of stainless steel and nickel, to bolster its nickel mining efforts. Tsingshan will own up to a 49% stake in Harum’s nickel unit, providing capital and technical expertise.
This collaboration, however, presents potential challenges for Harum Energy’s access to Western markets. Western automakers, driven by incentives under the U.S. Inflation Reduction Act, are increasingly seeking nickel sources devoid of Chinese influence. Gunara mentioned that Harum is exploring strategies to become compliant with the Inflation Reduction Act, though the company is still determining the best approach to meet these criteria.
As PT Harum Energy navigates these strategic changes, it aims to position itself robustly in the burgeoning market for nickel, essential for the next generation of clean energy technologies. 
