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PERHAPI: Government Reasons on Moratorium Nickel RKEF Smelter Investment

Thu 24 Nov 2022, 09:00 AM



Chairman of the Indonesian Mining Experts Association (Perhapi) Rizal Kasli welcomed the government's plan to stop new investments in the construction of the Rotary Kiln-Electric Furnace (RKEF) pyrometallurgical plant.

As is known, RKEF is a downstream line of processing high-grade nickel ore or saprolite to then produce stainless steel.

Rizal said the current reserves of high-grade nickel ore are relatively limited with an effective age in the range of 10 years. According to him, investment in saprolite processing and refining plants or smelters to produce stainless steel raw materials is fairly intensive, thus lowering the currently available reserves.

"There are already quite a lot of smelters that produce raw materials forstainless steel. The need also remains stable forstainless steelbecause it is needed for construction, medical devices and other machinery," said Rizal when contacted, Sunday (20/11/2022).

On the other hand, Rizal said, low-grade nickel ore is still not optimally cultivated. The reason is that investment in hydrometallurgical smelters to process limonite as raw material for electric vehicle batteries is still relatively limited.

According to him, the moratorium policy will also divert investment in smelters with RKEF technology in low-grade nickel processing plants. Thus, the downstream development of electric vehicle batteries can be more aggressive in the future.

"Several companies are in the refinery construction stage to produce mixedhydroxide precipitate (MHP) which will later be used as raw material for electric vehicle batteries," he said.

Previously, the Coordinating Ministry for Maritime Affairs and Investment (Kemenko Marves) was preparing a policy of stopping or moratorium on new investments in the construction of the Rotary Kiln-Electric Furnace (RKEF) pyrometallurgical plant which became the downstream line of processing high-grade nickel ore or saprolite to then produce stainless steel.

The moratorium policy will also be followed by corrective factor (CF) adjustments for the benchmark mineral price (HPM) of high-grade nickel ore. The hope is that there will be a shift in raw material consumption for nickel processing plants in limonite.

Special Staff to the Minister of Energy and Mineral Resources Irwandy Arif said the manoeuvre was taken to increase new investment in hydrometallurgical plants that further process low-grade nickel ore or limonite into electric vehicle batteries to solar panels.

"Mr. Menko Luhut has spoken with the Minister of Energy and Mineral Resources and the Minister of Industry so that the direction of stainless steel that consumes high levels of nickel should be limited," said Irwandy during an online discussion, Friday (11/18/2022).

Irwandy said his ministry and the Ministry of Industry are discussing the downstream intensification of the low-grade nickel ore in line with plans to stop new investment in the upcoming stainless steel-producing RKEF technology-based plant.

On the other hand, he said, the moratorium plan is still being matured after the initial meeting that has started since early 2021.

"At the beginning of last year, there was an internal meeting, yes, Rapim specifically for industry and mining, but it must be encouraged again to be more advanced," he said.

Image source: Ahli Tambang Sebut Alasan Pemerintah Bahas Moratorium Investasi Smelter RKEF Nikel



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