Danantara Indonesia invests heavily in nickel project to boost electric vehicle battery production
- Danantara Indonesia will invest $1.4 billion in a nickel smelting facility being developed by GEM and Vale in Central Sulawesi.
- This facility will produce 66,000 tons of nickel annually, critical for electric vehicle batteries.
- This investment supports Indonesia's goals for sustainable development in its nickel industry.
In a significant development for Indonesia's nickel industry, Danantara Indonesia, a sovereign wealth fund, has agreed to invest in a large nickel smelting facility. This $1.4 billion project is being developed by GEM, a Chinese battery manufacturer, in collaboration with Brazilian miner Vale. The facility is located in Central Sulawesi and is anticipated to produce 66,000 tons of nickel in mixed hydroxide precipitate each year. This venture aligns with Indonesia's ambition to become a leader in the nickel sector, particularly in supplying materials for electric vehicle batteries. The decision to invest comes as Danantara seeks to raise 50 trillion rupiah, approximately $3 billion, through the issuance of Patriot Bonds to domestic companies in Indonesia. With this capital raise, Danantara aims to provide financial support to various sectors, including the struggling national airline Garuda and other important infrastructure projects. The nickel sector is critically important due to its role in manufacturing batteries for electric vehicles, which is a rapidly growing market. By collaborating with global leaders in metallurgy, Danantara intends to enhance the sustainability and innovation aspects of the nickel industry, an area where Indonesia is already the largest global supplier. According to Rosan Roeslani, CEO of Danantara, this investment not only contributes to Indonesia's downstream development agenda but also underscores the commitment to sustainable practices within the industry. This forward-thinking strategy could set a precedent for future investments in the country. The furnace slag skimming at the nickel plant being developed highlights the ongoing modernization of mining and smelting technologies in Indonesia. The project reflects a broader trend where countries rich in mineral resources are looking to capitalize on the demand for high-purity nickel, essential for electric vehicle batteries. Danantara's investment is likely to encourage more foreign and domestic investors to explore opportunities in Indonesia's mineral sectors, thereby promoting economic growth and technological advancement in the region.