Indonesia’s Investment in New Nickel Smelting Reaches USD 5.03 billion

Indonesia’s Energy and Mineral Resources Ministry announced on Dec. 27 that there are 13 new nickel smelters that completed construction by October 2017 with total investment of $5.03 billion.
The smelters produce a variety of nickel products, including Nickel Pig Iron, Ferronickel Dan NiHidoxide, the ministry said in a statement. The smelters have processed total 34 million tonnes of nickel ore into 598,000 tonnes of Ferronickel and NPI as well as 64,000 tonnes of NiMatte.

The 13 smelters are as follows:

No. Company Product Investment Input Capacity Activity 
(In Tonnes) (Jan. -Oct. 2017)
1 PT Vale Indonesia Matte 845,000,000 8,000,000 Production. Jan-Oct exports: 64,244 tons
2 PT Aneka Tambang (Pomala) FeNi 600,000,000 2,716,948 Production. Jan-Oct exports: 85,539 FeNi
3 PT Fajar Bhakti Lintas Nusantara NPI 174,000,000 1,065,215 Production. Jan-Oct exports: 106,468 tons NPI
4 PT Sulawesi Mining Investment FeNi 636,000,000 1,600,000 Production. Jan-Oct exports:194,579 tons FeNi
5 PT Gebe Industry Nickel NiOH 150,000,000 1,100,000 Output: 10,000 tons/mo of Ni(OH) and 1,000 tons/m of Ni (99%)
6 PT Megah Surya Pertiwi FeNi 320,000,000 2,079,732 Production. Jan-Oct exports: 84,537 tons FeNi
7 PT COR Industri Indonesia NPI 400,000,000 818,827 Finished commissioning and started production. Jan-Oct exports: 24,797 tons NPI
8 Heng Tai Yuan NPI 36,300,000 250,000 Production. Jan-June exports: 3,566 tons NPI
9 Century Metalindo FeNi 50,000,000 641,026 Production. Jan-Nov exports: 11,349 tons FeNi
10 Indonesia Guang Ching Nikel and Stainless Steel NPI 1,020,000,000 7,500,000 Production. Jan-March exports: 30,000 tons NPI
11 Virtu Dragon FeNi 500,000,000 4,560,000 Production. Aug-Nov exports: 31,850 tons FeNi
12 PT Surya Saga Utama N/A 300,000,000 3,500,000 Production started in November 2017. Sales: 1,028 tons Luppen FeNi
13 PT Bintang Timur Steel FeNi 2,150,000 292,000 Has yet to consistently in operation since July 2015. 2017 production: 2,714 ton FeNi
TOTAL 5,031,300,000 33,831,748

 

There are 2 existing nickel smelters that have ceased their operation as surging coke prices increased operation costs and weakening metal prices early this year:

No. Company Product Investment Input Capacity Activity 
(In Tons) (Jan. -Oct. 2017)
1 PT Indoferro NPI 160,000,000 800,000 Has stopped operation since 19 July 2017
2 PT Cahaya Modern Metal Industry NPI 50,000,000 298,359 Has stopped operation since January 2016 as coke price hit US$300/ton, from US$100
TOTAL 210,000,000 1,098,359

 

Coke price accounts for 40 percent of production costs at PT Cahaya Modern Metal Industry, which used blast furnace technology for processing nickel. The smelter has been idled after coke price surged to US$200-US$300/ton in end 2016, from US$100/ton in 2015.

As for PT Indoferro, the company’s smelter wasn’t designed to process nickel ore, which made its operation uneconomical. The company’s smelter was initially designed to process iron ore.

The government noted a pickup in investment following the issuance of two Energy and Mineral Resources Minister decrees, which allow companies to sell low-grade nickel and use the revenue from sales to finance construction of their smelters.

There are 11 companies making new investments and 2 companies expanding their existing capacities with total investment worth US$4.3 billion and input capacity of 28 million tons nickel ore.  The companies are as follows:

No. Company Product Investment Input Capacity Activity 
(In Tons)
1 PT WanatiaraPersada FeNi 658,000,000 2,200,000 Construction progress: 5.3%
2 PT Aneka Tambang (Haltim) FeNi 262,185,000 1,219,945 Construction progress: 8.8%
3 PT First Pasific Mining FeNi 200,000,000 620,000 Construction
4 Bintang Smelter Indonesia NPI 231,000,000 992,000 Construction progress: 39.2%
5 PT Artabumi Sentra Industri NPI 155,969,778 1,800,000 Construction
6 HuadiNikel Alloy Indonesia NPI 300,000,000 500,000 Construction
7 KinlinNikelIndustri NPI 165,000,000 123,675 Commissioning
8 Titan Mineral NPI 300,000,000 530,000 Construction
9 PT Wan Xiang FeNi 850,600,000 7,000,000 Construction
10 PT Macika Mineral Industri NPI 68,724,118 728,640 Construction progress: 40%
11 PT FajarBakti (Expansion) FeNi 257,692,308 4,024,581 Construction
12 Sambas Minerals Mining FeNi 169,125,231 2,970,00 Construction progress: 3.22%
13 Ceria NugrahaIndotama NPI 700,650,374 4,900,000 Construction progress: 0.03%
14 PT Integra Mining Nusantara NPI 63,950,000 923,760 Construction progress: 20%
TOTAL 4,319,946,809 28,532,601