Huayou seeks $2.7 billion for Ford-backed Indonesia nickel plant
The fundraising comes as benchmark nickel prices trade near a four-year low amid weaker demand from the stainless steel market.
Copper miner Freeport Indonesia on Thursday launched its $3.7 billion copper smelter in Gresik, East Java, citing growing demand for the metal in the race to transition to renewable energy.
The smelter’s total input capacity is 1.7 million metric tons of copper concentrate and output capacity will reach around 650,000 tons of copper cathode and 50 to 60 tons of gold, said Tony Wenas, chief executive of Freeport Indonesia, majority owned by the Indonesian government but operated by US mining giant Freeport McMoran.
The facility is expected to produce its first copper cathode in August, when it starts to operate at 50% capacity, Wenas said, adding it will reach full capacity in December.
“Copper going forward will be very much needed by the world,” Wenas said. “Countries are racing to transition their energy sources to renewables and sustainable sources. This will need a lot of copper.”
Indonesia banned exports of all raw minerals from June 2023, but gave Freeport Indonesia and rival copper miner Amman Mineral Internasional dispensation until May 31, 2024, to allow them to finish the construction of their smelters.
Both companies have requested an extension of export permit until the end of 2024, so they could continue to ship copper concentrate while waiting for their smelters to reach full capacity. The government has said it would grant such extension.
Attending the launch, Investment Minister Bahlil Lahadalia reiterated his support for the export permit extension, especially after the launch of the Gresik smelter.
Minister Bahlil also asked Freeport to build another copper smelter in the country’s eastern region of Papua, near its Grasberg copper mine.
Freeport Indonesia spokesperson did not immediately respond to request for comment on the government’s proposal for Papua smelter and when asked whether the company has received the permit extension.
News website Bloomberg Technoz reported on Tuesday Freeport had not obtained the extension.
Jakarta has given Freeport Indonesia a tax break for its Gresik smelter investment.
(By Ananda Teresia and Gayatri Suroyo; Editing by Ed Davies and Michael Perry)
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