Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Coal miner PT Indika Energy and Taiwan-based Foxconn, which are partnering to make electric vehicles in Indonesia, are considering bringing in a Thai firm as a third partner, Indika’s top executive told Reuters on Wednesday.
Arsjad Rasjid, President Director of Indonesian miner Indika, declined to name the Thai company nor any target for the completion of the partnership due to ongoing negotiations, but said the three could invest in EV or EV battery production.
“We know the strongest automotive strongholds in ASEAN are Indonesia and Thailand … instead of competing, why don’t we complement,” he said in a video interview with Reuters while at a gathering of G20 leaders.
ASEAN is the Association of Southeast Asian Nations bloc.
In September, Indika and Foxconn launched a $2 billion joint venture to make EVs, batteries and energy storage in Indonesia.
Arsjad said the venture would likely focus on manufacturing electric buses in its initial production and may later move to make electric trucks.
Foxconn, Apple’s biggest iPhone maker, also has a $1 billion joint venture with Thai energy group PTT to produce battery EVs.
Foxconn did not immediately respond to request for comment by email.
Indika has recently acquired local metal firm PT Perkasa Investama Mineral, which has a bauxite mining business, to secure materials for battery production, Arsjad said, adding that it is looking to buy other bauxite or nickel mines.
Like many other energy companies, Indika wants to diversify its business to reduce exposure to coal – the most polluting fossil fuel – to reach a target of carbon neutrality by 2050.
Indika is one of the top coal miners in Indonesia, which is the world’s biggest coal exporter.
Arsjad, who chairs the B20 meetings of business executives from G20 economies, said the businesses had recommended initiatives to leaders to accelerate the world’s energy transition to renewables, including ways to balance the short- and long-term measures to expedite the phase-down of coal.
(By Stefanno Sulaiman; Editing by Gayatri Suroyo and Martin Petty)
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