PT Vale Indonesia Tbk. (INCO) and Zhejiang Huayou Cobalt Co. have established partnership with Ford Motor Company in a project to build a nickel battery raw material plant in Indonesia.
Ford Motor Company has acquired a direct stake in PT Kolaka Nickel Indonesia (KNI) alongside PT Vale Indonesia Tbk. (INCO) and Zhejiang Huayou Cobalt Co. As of December 21, 2023, the American company holds an 8.5% stake in KNI.
KNI is established to manage the high-pressure acid leach (HPAL) plant in Pomalaa Block, Kolaka, Southeast Sulawesi. The HPAL plant will process ore supplied by INCO from the Pomalaa Block mine to produce nickel in the form of Mixed Hydroxide Precipitate (MHP). This nickel product is expected to be cost-effective and used in electric vehicle (EV) batteries with nickel-rich cathodes.
Preparations for the initial location of the HPAL Pomalaa Block project have commenced, and the commercial operation of the HPAL plant is set to begin in 2026. This collaboration aims to provide essential materials for the automotive industry’s transition to EVs, boost the EV manufacturing industry in Indonesia, and support Ford’s plans to achieve a production rate of 2 million EVs by the end of 2026 with further gradual scaling.
In total, the HPAL project will involve an investment of up to US$4.5 billion or approximately IDR 67.5 trillion. When the initial collaboration agreement was signed on March 30, 2023, Christopher Smith, Chief Government Affairs Officer of Ford Motor Company, expressed optimism about the joint capital participation with Vale and Huayou.
“Firstly, there is an aspect in Indonesia that is crucial to creating an electric vehicle supply chain,” he said. Another reason is Indonesia’s possession of the world’s largest nickel reserves, a critical material in electric vehicle batteries. Therefore, Smith continued, Ford’s decision to form a strategic partnership with Vale and Huayou is highly fitting to meet the needs of nickel-containing EV components.
The HPAL Pomalaa Block plant is targeted to produce up to 120 kilotons of MHP per year. In its framework, the nickel processing project will run three ways, along with separate supply agreements being developed with Ford and Huayou for crucial precursor cathode active materials in lithium-ion battery manufacturing, collectively integrated with Ford’s other nickel sources.
Vale Indonesia Corporate Secretary Filia Alanda stated that KNI increased its paid-up capital through the issuance of new shares in accordance with the shareholder decision dated December 21, 2023. This action raised KNI’s authorized capital to IDR 3.82 trillion, divided into 3.82 million shares with a value of IDR 1 million each.
“Subsequently, KNI’s placed and fully paid-up capital became IDR 1.04 trillion, divided into 1.04 million shares with a value of IDR 1 million each,” said Filia, on December 26, 2023.
After the transaction, the ownership structure of KNI is now Huaqi (Singapore) Lte Ltd with 764,000 shares or equivalent to 73.20%, Vale Indonesia with 191,000 shares or equivalent to 18.30%, and Ford Motor with 88,716 shares or equivalent to 8.5%. Filia emphasized that this transaction is not material for the company and does not involve any conflicting interests in affiliate transactions.
