17 September 2023
Harita Group is increasingly committed to building an integrated nickel industry ecosystem on Obi Island, North Maluku. When KONTAN visited on Friday, September 15, it was evident that they are building new factories and supporting facilities on the western side of the 2,542 km2 island to increase the production of ferronickel, nickel sulfate and cobalt sulfate.
Heavy machinery is working around the clock to complete the construction of these new factories, accompanied by the sounds of mining and the production of various nickel ore derivative products.
"I myself have been coming to Obi Island almost every month and there's always something new happening," said Stevi Thomas, Director of External Relations for PT Trimegah Bangun Persada Tbk, a subsidiary of the Harita Group responsible for managing the integrated nickel mining complex.
There are also plans for the Lim family conglomerate to build a stainless steel plant on the island, which is a 12-hour journey from Jakarta, with a connecting flight at Ternate and a three-hour speedboat ride from Labuha.
South Korean steel giant Posco is also rumored to be interested and has recently taken steps in that direction.
According to PT Trimegah Bangun Persada Tbk's President Director, Roy Arfandi, in a recent statement to KONTAN, they have been continuously negotiating with potential partners for the stainless steel factory construction project. "At present, the negotiation phase is still ongoing. Hopefully, we can finalize it by the end of this year," Roy said.
Currently, the company can extract 1,353 metric tons of saprolite and 1,276 metric tons of limonite, which has a lower nickel content, annually from a total area of 5,524 hectares under the mining license (IUP). In addition, Harita also holds mining permits at several locations on Obi Island.
Not content with just the upstream mining business, in 2015, after 5 years of nickel ore mining, Harita built a ferronickel smelter with 4 production lines. Two years later, the downstream processing of saprolite nickel resulted in the production of the first ferronickel products.
As for limonite nickel, which used to be considered mining waste, they found a way to turn it into a high-value added product. Harita's founder, Lim Gunawan Hariyanto, was intrigued by the success of Chinese mining giant Ningbo Lygend in developing the PNG Ramu Nickel Laterite Project. The technology developed by ENFI was then refined into High-Pressure Acid Leach (HPAL).
"At the time, my friends were skeptical about the success of the HPAL technology because it had been tried unsuccessfully in several projects. They asked me to tell the boss not to use this technology," Stevi said.
Harita's founder, Lim Gunawan Hariyanto, was intrigued by the success of Chinese mining giant Ningbo Lygend in developing the PNG Ramu nickel laterite project. The technology developed by ENFI was then refined into High-Pressure Acid Leach (HPAL).
"At the time, my friends were skeptical about the success of the HPAL technology because it had been tried unsuccessfully in several projects. They asked me to tell the boss not to use this technology," says Stevi.
However, Harita remained determined to partner with Lygend to process limonite into mixed hydroxide precipitate (MHP).
In 2019, the joint venture, PT Halmahera Persada Lygend, began construction of a limonite nickel processing and refining plant using the hydrometallurgical system. The following year, they successfully harvested MHP production.
Harita has actively pursued downstream processing of both limonite and saprolite simultaneously. Their competitive advantage lies in the integration of the upstream mining operations with the downstream processing of mining products within the same industrial zone, along with access to a jetty and port for import and export. This integration has resulted in high levels of efficiency," says Stevi.
The original ferronickel smelter with 4 production lines has doubled in capacity with the addition of a second plant with 8 production lines.
Currently, with an input capacity of 7.8 million tons of saprolite nickel ore per year, PT Halmahera Jaya Feronikel is capable of producing 780,000 tons of ferronickel per year. This means they are ready to build a stainless steel plant.
What's equally fascinating is that Halmahera Persada Lygend produces more than 365,000 tons of MHP per year.
With an investment of approximately US$1 billion from the proceeds of the Initial Public Offering (IPO) of PT Trimegah Bangun Persada Tbk under the stock code NCKL, they are now capable of producing 247,000 tons of nickel sulfate and 32,000 tons of cobalt sulfate per year.
"You could say that we are currently the largest nickel sulfate producer in the world," said Rico Windy Albert, Head of Technical Support Department at PT Halmahera Persada Lygend.
Nickel sulfate and cobalt sulfate are derivatives of MHP that are only three steps away from becoming electric vehicle (EV) batteries: from nickel sulfate and cobalt sulfate, they need to be further processed into precursors, then cathodes, and finally EV batteries.
It is clear that Harita is fully committed to developing downstream products from limonite nickel. They are currently in the process of building a larger capacity version of the limonite processing plant, essentially replicating it at a higher capacity, and this plant is under construction.
It's no surprise that NCKL is optimistic about achieving their goals. If they were able to achieve sales of IDR 9.57 trillion in 2022, their sales are projected to jump to IDR 23 trillion in 2023. Similarly, their profit is estimated to increase to IDR 5.46 trillion compared to the previous year's profit of IDR 4.67 trillion.