ASIATODAY.ID, JAKARTA – The Ministry of Energy and Mineral Resources (ESDM) of the Republic of Indonesia will limit the construction of class II nickel smelters to maintain the balance of supply and demand for nickel ore, which has become increasingly unequal in recent times.
According to the Special Staff of the Minister of Energy and Mineral Resources for the Acceleration of Mineral and Coal Governance, Irwandy Arif, this decision must be taken so that Indonesia does not become an importer of nickel ore in the future.
The important point of this moratorium is aimed at ensuring that smelters that have been built continue to receive a supply of nickel ore for the continuity of production operations.
“The Ministry of Energy and Mineral Resources already has plans to implement restrictions. “The Coordinating Ministry for Maritime Affairs and Investment (Kemenkomarves) also said that the government will no longer issue permits for the construction of smelters for the type of pyrometallurgical process for class II nickel,” said Irwandy in a press release, quoted on Saturday (28/10/2023).
Irwandy explained that the government would comprehensively review this policy, especially for nickel processes in Indonesia, both low grade nickel (limonite) and high grade nickel (saprolite).
“Currently, there are 44 smelters for nickel that undergo a pyrometallurgical process towards stainless steel and 3 smelters that use a hydrometallurgical process towards batteries. “Consumption of nickel ore for pyrometallurgy with saprolite is 210 million tonnes per year and limonate is 23.5 million tonnes per year,” said Irwandy.
Currently, there are 25 smelters under construction requiring a nickel supply of 75 million tons per year. Meanwhile, in the direction of the hydrometallurgical battery process, there are 6 smelters under construction with a need for ore of 34 million tons per year.
At the planning stage towards pyrometallurgy, there are 28 smelters and 10 smelters for hydrometallurgy with requirements of 130 million tons per year and 54 million tons per year respectively.
“To date, the total number of smelters, not to mention the newest ones, is 116 melters, consisting of 97 pyrometallurgical smelters and 19 hydrometallurgical smelters,” said Irwandy.
Prometindo Association Advisory Board Arif S Tiammar supports the move by the Ministry of Energy and Mineral Resources to put a moratorium on the construction of smelters for class II nickel. According to him, this is a good step to limit excessive production.
“I support efforts to limit the development of projects based on ferrometallurgy that consume saprolite nickel ore to become FeNi or NPI or mate. “Even though we have very large reserves on the hydrometallurgical side,” said Arif.
Arif revealed several reasons for agreeing to this moratorium policy.
Firstly, to limit excessive production capacity and position Indonesia to become the largest NPI producer in the world.
“The current production capacity is extraordinarily large, in fact the amount based on 2022 data is 9 million tonnes of NPI (nickel pig iron) with a nickel content of 1.1 million tonnes per year. “Finally placing Indonesia as the world’s largest NPI producer,” said Arif.
The second reason is the resilience of the reserves held, and the third is supply demand which has an impact on world NPI market prices.
“I myself am the perpetrator. “The price of NP or FeNi itself is currently very low compared to the next two years because the amount of NPI available is extraordinarily abundant, causing the price of NPI to fall,” he stressed. (AT Network)
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