Australian miner,Nickel Mines, has signed a sales and purchase agreement with its partner, Shanghai Decent Investment (Group) Co., Ltd., to acquire a 70 percent stake its Indonesian assets,PT Angel Nickel Industry (ANI), said the company on Nov. 24. According to managing director Justin Werner, the deal has total valued US$490 million.

The Angel nickel project comprises four rotary kiln electric furnace lines and a captive 380 megawatts power station, which is currently under construction within the Indonesia Weda Bay Industrial Park (IWIP) on Halmahera Island, in North Maluku province.

Under the bidding agreement, in the first tranche,Nickel Mineswillpay $210 million by the end of the first quarter of 2021 to purchase 30 percent of Angel Nickel project stakes.Then, the company paying $280 million to acquire 40 percent interest in the project by the end 2021.

Werner said, the investment in Angel Nickel will be undertaken under a replica structure to its Hengjaya Nickel and Ranger Nickel investments, through two Singaporean incorporated holding companies that will wholly own an Indonesian incorporated operating company. The lines, with an annual nameplate production capacity of 36,000 tones of equivalent contained nickel in nickel pig iron (NPI)

To develop the project the company is estimating to spend more than $700 million andShanghai Decent will purchase the products produced by the producer at market price.Angel Nickelis planned to be commissioned no later than Oct. 16, 2022.

The company its expecting to produces 25,200 tones of NPO a year, out of the new unit of publicly listed, PT Harum Energy Tbk (IDX: HRUM) total production capacity of 36,000 tones.For comparison, the Hengjaya Nickel and Ranger Nickel projects, each have an annual production capacity of 15,000 tones of nickel pig iron.

Combined, the company 80 percent interest units represents 24,000 tones per annum of attributable nickel metal production.In the country,Tsingshan Groupmanaged industrial zones under PTIndonesia Morowali Industrial Park as a new nickel production frontier with growing nickel pig iron supply from Indonesia set to increasingly displace higher cost production from China.

The chinese firm is collaborating with a number of different partners like Eramet, Zhejiang Huayou Cobalt, and Zhenshi Holding Group.Presently, there are four commissionedrotary kilnelectric arc furnacelines and eight lines nearing completion, with power, port capacity and other ancillary services continuing to be progressively established.