The Jakarta Post
Top nickel matte producer PT Vale Indonesia expects to spend about US$120 million on capital this year, lower than initially expected, primarily because of a project delay.
Vale had sought to spend less than $166.6 million this year on capital but further lowered its projection after delaying a plan to rebuild part of its Sorowako nickel smelter in Sulawesi, the country’s nickel mining heartland.
The company moved the start of five-month project from the fourth quarter of this year to the second quarter of next year as a result of logistical delays during the pandemic.
“This will, of course, affect our production next year,” said Vale chief financial officer Bernardus Irmanto at an online public meeting on Wednesday.
Vale, which is traded on the Indonesian Stock Exchange (IDX) under the symbol INCO, disbursed $77.3 million from January to June.
As a result of the delay, Vale expects to produce more nickel matte this year than initially expected. The new production target is 73,700 tons, up 4 percent from earlier this year, when the plan to rebuild the smelter was still on track.
Vale saw its net profit rise to $53.12 million in the first half of the year, turning around a $26.17 million loss from the same period last year, the company’s financial report shows.
Bernadus added that Vale was continuing talks with regulators, lenders and partners to begin developing multimillion dollar smelters in Pomalaa, Southeast Sulawesi, and in Bahadopi, Central Sulawesi. He expected Pomalaa’s Final Investment Decision (FID) by the first half of next year.
“Their progress is more or less the same,” he said, noting that Bahadopi was “slightly behind Pomalaa in terms of permits”.