Entering the Nickel Smelter Business, SG Energy’s Subsidiary Partners with Hengsheng New Energy
Fri 31 Oct 2025, 08:37 AM
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A subsidiary of PT Sumber Global Energy Tbk (SGER), PT Sumber Mineral Global Abadi Tbk (SMGA), has officially entered the nickel smelting business.
On Friday (October 31, 2025), SMGA announced that it had signed a Strategic Partnership Agreement with PT Hengsheng New Energy Material Indonesia (Hengsheng).
Through this partnership, SMGA will acquire a portion of Hengsheng’s shares and collaborate on developing a converter smelter facility to upgrade low-grade nickel matte into high-grade nickel matte.
The smelter to be built will use Oxygen-Enriched Side Blowing Furnace (OESBF) technology. SMGA stated that this is an advanced nickel refining technology that is efficient, environmentally friendly, and proven globally.
SMGA Director Hu Bo said the partnership is a strategic step to strengthen SMGA’s position in the global nickel industry supply chain and accelerate the transition toward a green economy.
This move is also part of SMGA’s broader strategy to reinforce the domestic nickel downstream supply chain and support the development of a sustainable new-energy industry in Indonesia.
“Bulk commodities such as nickel and coal do have cyclical ups and downs, but we are confident that demand for new-energy raw materials will continue to grow. SMGA aims to be at the forefront of Indonesia’s mineral industry transformation with a robust, sustainability-oriented downstreaming strategy,” said Hu Bo in a press release, Friday (October 31, 2025).
SMGA’s investment in Hengsheng marks a new chapter in its downstream strategy, focusing on value creation by converting low nickel matte into high nickel matte. With this vertical integration model, SMGA strengthens its position as a key player in Indonesia’s integrated nickel ecosystem from upstream to downstream.
Global nickel demand for electric vehicle batteries and energy storage systems is rising rapidly. Demand is projected to increase from 545,000 tons in 2024 to more than 1.5 million tons by 2030, growing about 18.7 percent per year.
“This is a major opportunity we intend to capture together with Hengsheng,” he added.
Under the partnership, SMGA will play an active role in supplying strategic raw materials such as coal, nickel ore, and black mass (recycled battery materials), while ensuring smooth procurement of the converter smelter so Hengsheng can operate at maximum capacity.
The OESBF technology used by Hengsheng is one of the key reasons for this collaboration. The technology not only improves refining efficiency, it also significantly reduces emissions and pollution, aligning with the national industrial decarbonization agenda.
The collaboration between SMGA and Hengsheng is expected to create strong synergies between SMGA’s broad raw-material sourcing capabilities and Hengsheng’s advanced nickel refining technology, while strengthening national industrial resilience amid growing global demand for clean-energy materials.
The partnership will take effect upon receiving approvals from relevant stakeholders and fulfillment of all regulatory prerequisites.
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