Indonesia Pushes Downstream Nickel Roadmap Until 2045

The Indonesian government is pushing for a roadmap for the nickel downstream program. The roadmap consists of the stages for the downstream program until 2045. Apart from being used by the Ministry of Energy and Mineral Resources (ESDM), a nickel smelter roadmap has also been prepared by the Ministry of Industry.

According to industri.kontan.co.id, Indonesia has the world’s largest nickel reserves. This makes Indonesia have an important role in the global supply of nickel raw materials. Based on data from the Ministry of Energy and Mineral Resources, Indonesia’s nickel resources are 17.68 billion tons and reserves are 5.2 billion tons. Nickel reserves are mostly scattered in Southeast Sulawesi, Central Sulawesi and North Maluku.

“We are compiling a grand strategy for the mineral and coal sector. This is all in Minerba, so the roadmap is all there for important commodities,” said the Special Staff of the Minister of Energy and Mineral Resources for the Acceleration of Mineral and Coal Management Irwandy (08/03/2023).

Irwandy revealed that there had been discussions between ministries. One of them is at the Ministry of Energy and Mineral Resources. His party has discussed the construction of a pyrometallurgical smelter which produces nickel pig iron (NPI) and ferronickel.

“The target is waiting for certain data. It is looked at comprehensively, starting from the smelter’s reserve resources,” he said.

Currently, there are 33 smelters with pyrometallurgical technology that are operating and producing up to 115.45 million metric tons of NPI. As many as 37 smelters that will produce 90.88 million MT are under construction and 27 smelters are planned to be built.

“Meanwhile, the nickel reserves are 5.5 billion tons. Imagine if it continues like this. Reserves run out if there is no exploration and new discoveries. So it’s quite critical,” he added.

Downstream Program Problem

It is necessary to build a hydrometallurgical smelter that produces electric battery raw material products. However, the construction of a hydrometallurgical smelter is relatively more expensive than pyrometallurgy.

Irwandy explained that to build an HPAL smelter, funds of around USD 1 billion or more were needed. However, in preparation for funding, the government has brought together companies and banks to see potential opportunities to develop nickel smelters.

Secretary General of the Association of Indonesian Processing and Refining Industry Companies (AP3I) Haykel Hubeis also gave his statement. Haykel admits that there are funding constraints, particularly at local banks. On the other hand, foreign companies are more dominant in seeing potential.

“Whether from China, India or other Asian countries such as Japan. They see potential. Indeed, smelters need great effort and responsibility. A Downstream Task Force is needed,” he added.