JAKARTA - PT Vale Indonesia Tbk (INCO) obtained a Sustainability-Linked Loan (SLL) facility worth 750 million US dollars, with an additional greenshoe option of 250 million US dollars.
President Director and CEO of PT Vale, Bernardus Irmanto explained, this syndicated loan facility is the first for PT Vale and is an important milestone in strengthening the company's financial resilience, supporting the development of strategic projects, and ensuring responsible mining practices in line with global market demands.
"This facility is supported by a syndicate of 14 international banks and experienced an oversubscription of up to 1.7 times, reflecting the high level of confidence in the business fundamentals and the strategic direction of PT Vale's sustainability," he said, quoted Friday, April 24.
According to him, along with the acceleration of electrification and the development of renewable energy globally, the demand for nickel as a key component of electric vehicle (EV) batteries and energy storage continues to increase. Based on the International Energy Agency's projections, global battery storage capacity is expected to increase up to 14 times, while EV battery demand is projected to increase 7 times by 2030.
"In this context, PT Vale is in a strategic position as a nickel producer with a relatively lower carbon intensity, supported by the use of renewable energy from three hydroelectric power plants (PLTA) that are integrated into its operations. The company is also improving the capacity and reliability of the PLTA infrastructure to support the gradual electrification of operations," said Bernardus.
This SLL facility is structured based on the Sustainability-Linked Financing Framework, which is in line with international practices in sustainable financing. The key performance indicators or Key Performance Indicators (KPI) used include a reduction in carbon emission intensity and an increase in the use of renewable energy.
"Both KPIs have received a "strong" assessment from an independent Second Party Opinion, which assesses the alignment with the global target to limit temperature rise in accordance with the Paris Agreement 1.5°C pathway, as referred to in the independent study, as well as its contribution to Indonesia's Nationally Determined Contribution (NDC) target.
"This facility marks an important step in our journey to align our financing strategy with the company's decarbonization and long-term growth agenda. We are committed to continue to deliver high-quality nickel with a lower carbon footprint, while supporting the development of the national downstream industry and the global energy transition," he said.
In terms of fund utilization, this facility will be used to support the development of the company's strategic projects. In 2026, about 50 percent of the funds will be allocated for the development of the Pomalaa IGP project, about 30 percent for the Morowali IGP project, and about 20 percent for the development of the Sorowako Limonite IGP.
Meanwhile, in 2027, funding will be focused on the continuation of these projects as well as the fulfillment of participating rights in joint venture projects.
As part of its commitment to creating shared value, PT Vale will also channel the financial benefits obtained from the adjustment of performance-based sustainability margins into community development programs. This approach ensures that the success of achieving ESG targets not only impacts the company's operations, but also makes a real contribution to improving the welfare of the communities around the operational areas.
The English, Chinese, Japanese, Arabic, and French versions are automatically generated by the AI. So there may still be inaccuracies in translating, please always see Indonesian as our main language. (system supported by DigitalSiber.id)
