MDKA’s Nickel Smelter Hits 42% of Production Goal for First Half of 2025
Thu 14 Aug 2025, 09:37 AM
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PT Merdeka Copper Gold Tbk. (MDKA) is boosting nickel production in the form of mixed hydroxide precipitate (MHP) through several new nickel smelters.
Through its subsidiary, PT Merdeka Battery Materials Tbk. (MBMA), MDKA has built three nickel smelters using high-pressure acid leach (HPAL) technology. Only one of these is operational and producing MPH nickel, managed by PT ESG New Energy Material.
The ESG nickel smelter, specifically Train A, which began operations in December 2024, successfully increased production to 6,080 tons of MHP nickel in the second quarter of 2025, up from 4,569 tons in the first quarter of 2025. In total, the smelter produced 10,649 tons of MHP nickel in the first half of the year.
For your information, this year the company is targeting MHP nickel production of 25,000–30,000 tons. This means that production in the first half of this year has reached 42.60% of the minimum target of 25,000 tons.
In line with production growth, sales also increased to 9,465 tons of MHP nickel in the second quarter of 2025. MDKA's General Manager of Corporate Communications, Tom Malik, stated that this achievement also contributed to MDKA's performance.
"The total production of 9,465 tons of MHP nickel was sold at an average selling price (ASP) of USD 12,266 per ton, with a cash cost of USD 8,995 per ton after cobalt credit," Tom explained to Kontan, Thursday (14/8/2025).
In other words, the cash margin per ton of MHP nickel is USD 3,271, so the total cash margin from MHP nickel sales during the first half of the year is estimated to reach USD 30.96 million.
MHP nickel production for the next period also has the potential to grow with additional production from PT ESG's Train B smelter, which began production at the end of the second quarter of 2025.
Currently, the feed preparation plant (FPP) for the plant's operations is being conducted in Morowali, but will be transferred to a new FPP at the SCM mine site once the facility begins operations in the fourth quarter of 2025.
The FPP facility at SCM will also supply ore to two other MHP nickel smelters, namely those managed by PT Meiming New Energy Material and PT Sulawesi Nickel Cobalt (SLNC).
For your information, the SLNC-managed smelter, which began construction in Morowali last January, is still under construction and is expected to be completed in mid-2026. This factory is targeted to be able to produce up to 90,000 tons of MHP nickel per year.
"The production ramp-up will be carried out in four stages, each contributing 22,500 tonnes per year," explained Tom.
By the end of the second quarter, construction of the SLNC smelter had reached 29%, and construction of the FPP at SCM had reached 16%. All smelter autoclaves had been installed, and excavation of the long-distance pipeline that would distribute the FPP to the smelter had begun.
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