Jakarta,CNBC Indonesia – The Ministry of Energy and Mineral Resources (ESDM) said that it plans to stop or moratorium the construction of new nickel processing and refining facilities (smelters).
The reason is that Indonesia’s nickel ore reserves are running low, inversely proportional to the increasing number of new smelter projects.
Minister of Energy and Mineral Resources Arifin Tasrif said that his party was still discussing with the Minister of Industry regarding restrictions on second-class nickel smelters which produce ferronickel (FeNi) and Nickel Pig Iron (NPI) products. This needs to be done considering that smelter permits are in the form of Industrial Business Permits (IUI) under the authority of the Ministry of Industry.
“We’ll see later, communication with Industry,” said Arifin at the Ministry of Energy and Mineral Resources Building, Jakarta, Thursday (26/10/2023).
Arifin also hopes that the nickel downstream program will not only stop at semi-finished goods, but also downstream products that will lead to industrialization.
“Basically, we direct all the products that arrive there so that in the future they will be continued downstream,” he said.
Previously, the Ministry of Energy and Mineral Resources opened up about Indonesia’s increasingly depleting nickel reserves. It is noted that Indonesia’s nickel reserves could run out in the next 6-11 years. The depletion of nickel reserves in Indonesia is actually the result of the large number of smelter construction.
It is recorded that for nickel through the pyrometallurgical process or which processes high grade nickel there are 44 smelters. Meanwhile, nickel goes through a hydrometallurgical process which processes low grade nickel in 3 smelters.
With the existing smelter, consumption of nickel ore for high grade pyrometallurgy, namely saprolite, is 210 million tons per year. And for hydrometallurgy which produces raw materials for battery components, it requires low grade nickel ore, namely limonite, amounting to 23.5 million tons per year.
Currently there are still nickel smelters in the construction stage, of which there are 25 smelters for the pyrometallurgical process and 6 smelters for nickel through the hydrometallurgical process in the construction stage.
In fact, there are still plans to build 28 pyrometallurgical smelters and 10 smelters with hydrometallurgical processes are currently in the planning stage.
“The total smelters that exist to date, not to mention the newest ones, are 116 smelters,” explained Special Staff to the Minister of Energy and Mineral Resources for the Acceleration of Mineral and Coal Governance, Irwandy Arif to CNBC Indonesia, quoted Thursday (19/10/2023) .
Irwandy said that overall nickel reserves, both saprolite and limonite, are approximately 5.2 billion tons remaining. Meanwhile, with consumption as stated or reaching around 210 million tons of saprolite and 23.5 million tons of limonite, it only has 6-11 years of life remaining.
[Gambas:Video CNBC]
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(wia)