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Vale will sell 14 percent stake in Vale Indonesia: minister
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Energy and Mineral Resources Minister Arifin Tasrif speaks during the G20 Energy Transitions Ministerial meeting in Nusa Dua on September 2, 2022. (AFP/Made Nagi)
M
ining company Vale will sell a 14 percent stake in its Indonesian nickel miner Vale Indonesia to bring the holding by overseas firms below the maximum limit, Indonesia's mining minister said on Friday.
Share divestment is a condition Indonesia requires to extend the operation permit for Vale Indonesia. Vale's current contract is due to end in 2025.
Under Indonesian rules, foreign investors are required to divest 51 percent of their stake to local buyers after a certain period of operation.
Minister Arifin Tasrif told reporters there will be a "special pricing" for the divestment, though he did not provide details of the pricing, adding the government is aiming for the deal to be secured this year.
Vale Indonesia's shares were traded at Rp 4,690 (29 US cents) a piece on Friday.
Arifin also said that following the permit extension, Vale will have three years to show progress in construction of its nickel processing facilities.
"For this extension, they have to carry out all those programmes. If they don't do them in three years, it (the extension) will be terminated," he told reporters.
Vale did not immediately respond to requests for comment.
Vale Base Metals, which controls the Indonesian unit through Vale Canada Ltd, is committing $10 billion for investment in Indonesia over the next decade, its chief executive said in September.
Vale Canada Ltd currently has 43.79 percent of Vale Indonesia and Vale Japan Ltd 0.54 percent. Other foreign investors include Sumitomo Metal Mining, with 15.03 percent.
The group and its partners are currently developing two facilities to process nickel ore into a material used in electric vehicles batteries and one plant to produce metal.
These projects would take the refining capacity of Vale Indonesia from around 75,000 tonnes per year to close to 300,000 tonnes upon completion.
