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Vale and Huayou sign heads of agreement for smelter, another win for EV industry

PT Vale Indonesia signed a heads of agreement with their long-term partner Huayou Cobalt Company to begin construction of a high-pressure acid leaching (HPAL) smelter in Sorowako, South Sulawesi.

Inforial (The Jakarta Post)
Jakarta
Wed, September 14, 2022

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Vale and Huayou sign heads of agreement for smelter, another win for EV industry CEO Febriany Eddy addressing the crowd before signing the Heads of Agreement at Park Hyatt Hotel on Tuesday (13.09).

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T Vale Indonesia signed a heads of agreement with their long-term partner Huayou Cobalt Company to begin construction of a high-pressure acid leaching (HPAL) smelter in Sorowako, South Sulawesi. The momentous signing was held at the Park Hyatt Jakarta on Tuesday. It was witnessed by representatives from both parties, along with Rachmat Kaimuddin, vice president commissioner of PT Vale representing MIND ID.

The development of the smelter had already begun earlier this year when Vale’s Chinese counterpart did a feasibility study of the area, with positive outcomes. This week’s heads of agreement has become a reference for further collaboration in the future.

The new HPAL plant will process nickel limonite ore into mixed hydroxide precipitate (MHP) product with the planned annual production capacity of around 60,000 tons of nickel in MHP. It will then be processed into materials for battery components, such as for electric vehicles (EVs). The target completion of the construction is set for 2025, following the Pomalaa smelter in Southeast Sulawesi.

“Our cooperation is a perfect combination of Vale's mineral resource advantage and Huayou Cobalt’s advanced high-pressure acid leaching technology advantage, to achieve low-carbon, green and sustainable mineral resource development. Our cooperation can also win growth opportunities for both sides, add strength and value to the industry and make contributions to the economic and social development of Indonesia,” chairman Chen Xuehua of Huayou said.

Both parties are committed to achieving carbon neutrality by 2050 and the agreement is another pledge to work together to minimize carbon emissions. Huayou will further discuss with PT Vale to study low-carbon energy alternatives. Moreover, Indonesia’s government has been developing the industry in hopes that the country can become one of the top producers of EV, as pointed out by CEO of Vale, Febriany Eddy.

“The energy [sector] in Indonesia is quite competitive. Right now we certainly hope that there won't be a big negative impact that we can't mitigate. Now we have to focus on building HPAL that processes low-grade nickel for electric vehicles,” said Febriany on future plans of the nickel produced.

PT Vale director Bernardus “Anto” Irmanto pointed out that the price of commodities, including nickel and coal, had increased since 2021, which had changed the amount of  production for the company because of some of its coal-powered facilities. He attributed one of the causes of this increase to the geopolitical conflict happening. Anto expressed his hope that the price of commodities would return to normal soon, and therefore PT Vale could continue to step away from coal-powerered plants as soon as possible.

“This partnership agreement is another catalyst for the sustainable economic development of Indonesia’s world-class nickel resources and together with recent progress on the Pomalaa HPAL facility and Bahodopi Block Project, shows we are committed to executing our next generation of sustainable growth projects with minimal environmental impacts for the benefit of local and national stakeholders,” said Deshnee Naidoo, president commissioner of PT Vale and executive vice president of Vale Base Metals.

To further honor the pledge to protect the environment, Vale built a tree nursery near the smelter. Febriany revealed that the company was currently doing a “reforestation” project of planting trees spanning an area of 10,000 hectares. She added that the team was still overseeing the land before handing it back to the local government. This was because one of the priorities of the company was sustainable mining.

“Human civilization still needs mining today. When we look at our lives, today we are here, there is internet, consumption, iPhones, TV, all of these are using locally mined goods. So our life today cannot be separated from these mining goods. What we can do is figure out how to carry out mining in a way to minimize the environmental impact as much as possible so that at the same time we maximize our mining activities and mining goods,” Febriany concluded.

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