Indonesia 3 World’s Largest Giant Factories

Smelter Freeport Indonesia di Gresik, Jawa Timur. (CNBC Indonesia/Verda Nano Setiawan)

Under the leadership of President Joko Widodo (Jokowi), Indonesia has made significant progress in its flagship program of downstream mining.

Through this program, the country has established itself as a global leader in downstream commodities, particularly in nickel, copper foil, and copper cathodes, which are essential for electric vehicle (EV) batteries.

Let’s explore these three factories that contribute to Indonesia’s ambition of becoming a prominent player in the EV battery industry:

Firstly, as part of the downstream program, Indonesia has successfully developed nickel sulfate production, a key raw material for cathode precursors in EV batteries. Harita Nickel, through its business unit PT Halmahera Persada Lygend (PT HPL), a subsidiary of PT Trimegah Bangun Persada Tbk (NCKL), is responsible for nickel sulfate production.

Recently, NCKL inaugurated the largest nickel sulfate production facility in the world, with a capacity of 240 thousand tons per year. Located in the Harita Nickel operational area on Obi Island, South Halmahera Regency, North Maluku Province, this factory marks a significant milestone for Indonesia. The first export of 5,584 tons of nickel sulfate, packaged in 290 containers, took place on June 16, 2023.

Secondly, PT Freeport Indonesia (PTFI) owns a copper factory, or a copper processing and refining facility (smelter), situated in the JIIPE Special Economic Zone (KEK) in Gresik, East Java. As of June 2023, the construction progress of this facility has reached 70.6%. Once completed, it is expected to become the world’s largest single-line smelter, with a capacity to process 1.7 million tons of copper concentrate annually.

The factory will produce approximately 600 thousand tons of copper cathode per year, along with valuable by-products such as pure gold and silver (6 thousand tons per year), sulfuric acid (1.5 million tons per year), copper slag (1.3 million tons per year), and gypsum (150 thousand tons per year). The establishment of this smelter will generate employment for 150 thousand workers, with 98% of them being Indonesian, including 50% local workers.

Lastly, PT Hailiang Nova Material Indonesia, a Chinese company, is quietly constructing a copper foil factory in the JIIPE SEZ in Gresik, East Java. This copper foil factory is poised to become the largest in Southeast Asia and will serve as an electric current collector at the negative pole (anode) of EV batteries. It will specialize in producing electrodeposit copper foil for lithium battery-powered electric vehicles. The factory’s capacity is planned at 100 thousand tons per year, divided into two phases, and is expected to employ a workforce of 1,920 individuals.

President Jokowi himself attended the groundbreaking ceremony of the copper foil factory on Tuesday, June 20, 2023, emphasizing the strategic position of the facility adjacent to PT Freeport Indonesia’s copper smelter. This proximity enables direct utilization of the cathode copper produced by Freeport, leading to the production of finished or semi-finished goods such as lithium batteries, EV batteries, or electric cars.

President Jokowi expressed his appreciation for these developments, highlighting their transformative potential for Indonesia’s economy and the goal of achieving completion of the copper foil factory within 12 months.

The synergy between the nickel, copper, and copper foil factories represents a significant step towards Indonesia’s vision of becoming a leading player in the global EV battery industry.

Image source >>> CNBC Indonesia/Verda Nano Setiawan

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