Get Ready! The Ministry Of Energy And Mineral Resources Has A Plan To Limit The Construction Permit For Nickel Class II Smelters

Smelter illustration (photo: between)

JAKARTA - The Ministry of Energy and Mineral Resources (ESDM) plans to conduct a moratorium or restrict development permits for the class II nickel processing industry.

Special Staff to the Minister of Energy and Mineral Resources for the Acceleration of Mineral and Coal Governance, Irwandy Arif, said that this plan was carried out taking into account the supply and demand of nickel ore.

According to him, the balance between supply and the need for nickel ore is needed so as not to make Indonesia an importer of nickel ore. This moratorium essence is intended so that the smelter that has been built will still get a supply of nickel ore for the sustainability of production operations.

"The Ministry of Energy and Mineral Resources has planned to impose restrictions. From the Coordinating Ministry for Maritime Affairs and Fisheries also said that the government would no longer issue permits for the construction of type smelters for the Pyrometalurgi process for class II nickel," said Irwandy, quoted on Friday, October 20.

Irwandy explained that the Government will comprehensively review this policy, especially for nickel processes in Indonesia, both low-grade nickel and high-grade nickel (sapprolate).

"Currently, there are 44 smelters of nickel that are experiencing a pyrometalurgi process towards stainless steel and those that use the hydromethalurgi process towards the battery are 3 smelters. Consumption of nickel seeds for pyrometelurgi with a saprolate is 210 million tons per year and a limousineate of 23.5 million tons per year," explained Irwandy.

Currently, he said, there are 25 smelters that are in the construction stage, requiring a supply of 75 million tons of nickel per year. Meanwhile, for the direction of the hydromethalurgi battery process, there are 6 smelters that are under construction with a need for 34 million tons of seeds per year.

In the planning stage towards pyrometelurgical, there are 28 smelters and 10 smelters for hydromethalurgy with a need of 130 million tons per year each and 54 million tons per year.

"Total, smelter yang ada sampai dengan saat ini, belum lagi yang terbaru itu ada 116 liter yang terdiri dari 97 smelter pyrometelurgi dan 19 smelter ke arah hydrometalurgi," ungkap Irwandy.

The Advisory Board of the Assetindo Association Arif S Tiammar supports the steps taken by the Ministry of Energy and Mineral Resources which will memorate the construction of smelters for class II nickel, according to him, is a good step to limit excessive production.

"To be honest, I myself am very supportive of efforts to limit the development of feronikel or project development based on ferrometelurgi which consumes nickel saprolate seeds into FeNi or NPI or mate. Even though we have a very large reserve on the hydromethalurgy side which comes from low-level nickel limousine or nickel," said Arif.

Arif revealed several reasons for agreeing to this moratorium policy. First to limit excessive production capacity and place Indonesia as the largest NPI producer in the world.

"The current production capacity is already enormous, even based on data in 2022 of 9 million tons of NPI (nickel pig iron) with a nickel content of 1.1 million tons per year. Finally, it places Indonesia as the world's largest NPI producer. This production restriction is the first reason I agree with a moratorium or restriction," said Arif.

The second reason is the resilience of the reserves owned and the third supply demand which has an impact on the world's NPI market price.

"I myself am the perpetrator. The price of NP or FeNi itself is currently very low compared to the next two years because the number of existing NPIs is extraordinarily abundant, causing the price of the NPI to fall. That is why we strongly agree with this moratorium effort," concluded Arif.