Lamseen – The Indonesian Nickel Miners Association (APNI) has revealed an opportunity for Australian multinational mining company, BHP Group Limited, to invest in Indonesia following their exit from the nickel business in Australia.
APNI Secretary General Meidy Katrin Lengkey mentioned that discussions have taken place between APNI and BHP regarding potential investment opportunities in Indonesia. “However, a final decision is yet to be made and will depend on various factors, including political conditions and regulatory frameworks from the new government,” she told Antara on Tuesday (July 30, 2024).
Meidy pointed out several reasons why Australian Mining Giant BHP might consider entering the Indonesian market. One major factor is the high production costs of BHP’s sulfide mines in Australia compared to the lateritic nickel mines predominant in Indonesia. She noted that BHP is under pressure due to the global drop in nickel prices. The company has struggled to maintain its competitiveness due to rising production costs.
On the other hand, Indonesia is seen as a more cost-effective option due to supportive government incentives and facilities. “That’s one of the reasons why BHP might opt to shift rather than continue incurring losses,” Meidy added.
Furthermore, BHP already has downstream infrastructure for processing nickel matte and requires a steady nickel supply to ensure operational continuity. Hence, Indonesia, with its significant nickel production potential, is viewed as a promising partner.
APNI hopes that if BHP does invest in Indonesia, it could attract other major investors beyond China. This aims to diversify investment sources and foster healthy competition within Indonesia’s nickel mining sector.
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Indonesia is preparing a comprehensive electric vehicle (EV) ecosystem, including export markets for EV components. Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan announced that Africa is a key target for exporting Indonesian electric vehicle batteries.
“Africa’s population is expected to double by 2045, making it a significant market.” Luhut stated during the International Battery Summit, as reported by Antara on Monday (July 29, 2024). Consequently, Indonesia is actively seeking cooperation with African nations.
In pursuit of this, Luhut mentioned he had visited Africa to establish connections regarding the electric vehicle industry. “They view Indonesia as a country that can support them with EV technology,” Luhut said. Looking ahead, Luhut indicated that in September, he would discuss further collaboration on EV projects with African countries at the Indonesia-Africa Forum.
“We look forward to collaborating with them, particularly Kenya and South Africa,” he noted.
Luhut elaborated that Indonesia already has various collaborations with African countries, including Pertamina’s partnership with Kenya and potential electricity cooperation with PLN. “Pertamina and PLN are also working with South Africa, and we are involving the World Bank in Africa as well. We will see how that develops,” Luhut concluded.
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