Jakarta, CNBC Indonesia – President Joko Widodo (Jokowi) has instructed his cabinet to no longer sell “homeland” or raw goods, but must first process them into finished goods.
By processing raw goods into finished goods, the added value for the country will be multiplied. In fact, the mining industry’s Non-Tax State Revenue (PNBP) after this downstreaming will jump to Rp 1,000 trillion per year from the current Rp 40 trillion per year.
Therefore, the government is currently preparing the Minerba Commodity Grand Strategy (GSKM). One of the mining commodities that will be prepared for the road map for GSKM is nickel.
Nickel is an important metal element in the battery cell components used for electric cars.
The Director General of Mineral and Coal (Dirjen Minerba) of the Ministry of Energy and Mineral Resources, Ridwan Djamaluddin, said that if the nickel commodity was pushed to downstream products, the added value could increase 4-5 times.
“Nickel ore processing, if we lower it further downstream, is estimated to result in an increase in added value of up to 4-5 times,” he said in a Hearing Meeting (RDP) with Commission VII DPR RI, Tuesday (28/09/2021).
Ridwan also outlined a road map (roadmap) for this nickel mineral commodity. The first is an increase in reserve resilience and optimization of nickel ore products, which is carried out through increased exploration, then an increase in natural resources as reserves.
“Conversion of resources into reserves means increasing their status,” he said.
Then, the government will carry out an inventory of low grade nickel ore (limonite) produced from mining saprolite (high grade nickel ore above 1.7%), then mining saprolite and limonite simultaneously to reduce costs.
“This is so that the saprolite is not taken, but the limonite is wasted as waste. We are also verifying and standardizing resources and reserves to find out better limonite and saprolite,” he continued.
Furthermore, the second roadmap is the improvement, optimization and efficiency of the refining processing industry. In detail, this can be done through accelerating the construction of hydrometallurgical plants, the development of nickel sulfate (NiSO4) plants, both from the hydrometallurgical and pyrometallurgical routes.
Then, limiting the number of ferronickel (FeNi)/ Nickel Pig Iron (NPI) factories and encouraging the production of class 1 nickel, such as nickel sulfate which can be reprocessed into battery cell cathodes.
Then, the utilization of the Remaining Processing and Purification (SHPP) of the pyrometallurgical process
such as slag and sulfuric acid, as well as hydrometallurgy in the form of rare earth metals (LTJ), iron deposits, and encouraging mastery of technology including Engineering, Procurement, and Construction (EPC) factory.
The next roadmap is the development of the fabrication industry, manufacturing, and increasing the Domestic Component Level (TKDN). This is done by increasing the domestic absorption of class 2 nickel (FeNi/NPI) products through the development of the stainless steel industry and conversion of class 2 nickel to class 1 nickel such as nickel matte and Mixed Hydroxide Precipitate (MHP) and nickel sulfate.
Then, import substitution and fulfillment of domestic stainless steel needs were carried out by developing the 200-type stainless steel industry, developing the Nickel Manganese Cobalt (NMC) cathode industry, developing the nickel-based battery cell industry for electric vehicles.
“Then the nickel industry will be developed for raw materials for NRE technology and for super alloys,” he continued.
The final roadmap is optimizing the use of domestic products and the declaration of a recycling system. In detail, the efforts made are optimizing the use of domestic products to reduce imports and for the development of downstream industries.
Then, a recycling system must also be built as an effort to reduce dependence on non-renewable natural resources.
It should be noted that nickel processing and refining that has been running in Indonesia, among others, produces NPI, ferronickel, nickel matte, stainless steel, slab and hot rolled coil (HRC) products, as well as MHP (Mixed Hydroxide Precipitate).