Nickel Industries Gears Up for HPAL Smelter Construction in Indonesia
According to reporting by the Jakarta Post, Nickel Industries, an Australian-based nickel company, is on the brink of finalizing its plans to set up a high-pressure acid leaching (HPAL) smelting facility at the Indonesia Morowali Industrial Park in Central Sulawesi. The announcement indicates the project's advancement into the final investment decision (FID) stage in the coming weeks.
The proposed smelter is intended to process nickel limonite ore, translating into an annual production capacity of approximately 72,000 tonnes of mixed hydroxide precipitate (MHP).
Justin C. Werner, Nickel Industries' managing director, informed reporters in Jakarta that the company intends to finance 55% of the smelter's $2.3 billion investment. The remainder will be funded by its partners. The facility aims to produce three major class-one nickel products: MHP, nickel sulfate, and nickel cathode.
A noteworthy aspect of MHP is its significant application in EV batteries, distinguishing it from other nickel products such as ferronickel and nickel pig iron (NPI) primarily used in stainless steel production.
Highlighting the potential of Indonesia's move toward becoming an EV production hub, Werner expressed his positive outlook on MHP demand. He anticipates its growth to approximately 1.5 million tonnes within a decade, up from the current 500,000 tonnes, given the expanding EV market.
In a bid to boost its commitment to sustainable operations, Nickel Industries has inked a deal with renewable energy firm PT Sumber Energi Surya Nusantara (SESNA). The agreement entails SESNA establishing a 200 MW peak capacity solar power plant, which will cater to nearly 18-20% of the smelter's electricity needs. An accompanying 20 MWh battery storage will also be developed.
SESNA's CEO, Rico Syah Alam, emphasized the importance of incorporating green energy in the EV battery supply chain, referring to their successful past collaboration with Nickel Industries.
In January, Nickel Industries announced its plans to raise $471 million in capital. This move was geared toward the acquisition of various nickel projects in Indonesia. Collaborative efforts with Shanghai Decent Investment, a subsidiary of Tsingshan Group, one of the world's foremost nickel producers, are also in the pipeline.
In alignment with its vision to shift from the stainless steel sector to emerge as a top-tier battery-grade "Class 1" nickel producer, Nickel Industries recently acquired a 10% stake in PT Huayue Nickel Cobalt for $270 million from Newstride Development Ltd., a Tsingshan Group entity.
