Having Abundant Nickel Reserves, Bahlil: This Is The Momentum For Indonesia To Rise To Become An Industrial Country

JAKARTA - Investment Minister Bahlil Lahadalia said that the future energy trend of changing from fossil to environmentally friendly energy brings benefits to Indonesia. This is because fossil fuels as vehicle fuel will be replaced with batteries as components of electric vehicles, where most of the raw materials for making these batteries are in Indonesia.

Therefore, according to him, this is the momentum for Indonesia to become an industrialist country. Moreover, Bahlil continued, 25 percent of the world's nickel reserves are stored in Indonesia's Mother Earth.

As is known, for the manufacture of batteries, four main raw materials are needed, namely nickel, manganese, lithium and cobalt. Compared to several other countries, Indonesia's advantage is that it has nickel laterite.

"45 percent of the electrical components are in batteries and the raw materials for batteries are nickel, manganese, then cobalt and lithium. Cobalt, manganese, nickel are in Indonesia, lithium is in Australia, we don't have it. We import it. And 25 percent of the total nickel reserves The world is in Indonesia," he said in a webinar, Wednesday, September 29.

"Thus, this is a momentum for Indonesia to rise to become an industrial country that produces car batteries," he continued.

As is known, the construction of an electric car battery factory in Karawang, West Java is the result of cooperation with foreign investors, namely South Korea. The total investment with LG has reached 9.8 billion US dollars.

"So how do we do it? We do a direct contract with LG. We from the Ministry of Investment lead the negotiations without any foreign consultants," he said.

Previously, Bahlil Lahadalia revealed that many countries wanted to prevent Indonesia from becoming a world battery producer. Therefore, he said, the government needed to act quickly to start the early stages of developing the electric battery industry in the country.

Furthermore, Bahlil admitted that he had read the signs of neighboring countries that did not want Indonesia to advance in the electric car battery industry. Bahlil said, these countries only want to take raw batteries from Indonesia.

"We realize that our neighboring countries do not want Indonesia to become one of the battery producing countries in the world. They want to take raw materials from us, but make them in their country so that it is made in country A, made in country B. We read this sign," he said in a virtual press conference, Friday, September 17.

But unfortunately, Bahlil did not specifically mention which countries want to hinder Indonesia's steps to become the world's electric car battery producer. Even so, Bahlil emphasized that Indonesia is the first country in Southeast Asia to have an electric battery factory.

"This is the first time in Indonesia, in Southeast Asia. For this world, if you have built an ecosystem, one of the first in the world. This will already be built in 2022," he said.

Previously, President Joko Widodo (Jokowi) inaugurated the groundbreaking or laying of the first stone for an electric car battery factory in Karawang, West Java on September 15. He said that Indonesia provided support in the form of easy permits and legal certainty for the development of the downstream industry.

For your information, the project is the realization of an investment by the LG and Hyundai consortium consisting of the Hyundai Motor Company, KIA Corporation, Hyundai Mobis and LG Energy Solution.

The previous electric car battery development project was marked by a memorandum of understanding or MoU between the Ministry of investment and the Hyundai and LG consortium in December 2020.

Later, the consortium from South Korea will partner with Indonesia Battery Corporation, which consists of PT Indonesia Asahan Aluminum (Inalum), PT Aneka Tambang Tbk (ANTM), PT Pertamina, PT Perusahaan Listrik Negara, and Contemporary Amperex Technology Co. Ltd.

The consortium will build an electric vehicle battery cell factory in Indonesia with a capacity of 10 Gigawatt Hours (GWH) with a total investment value of US$1.1 billion. This figure is equivalent to IDR 15.9 trillion (assuming an exchange rate of IDR 14,500). The construction of this factory is only part of the consortium's total project worth US$9.8 billion.