Three large mining companies will hold an initial public offering (IPO) of shares with a target of raising US$ 1.5 billion or Rp 22 trillion this year. They are PT Merdeka Battery Materials (MBM), PT Amman Mineral Internasional (AMI), and the Harita Group business unit in the nickel sector. Based on a research report by JP Morgan, a global financial services company, the IPOs of the three companies' shares had a positive impact on the Indonesian stock market. In addition, investors have more options to invest in nickel stocks outside of the old players, namely PT Vale Indonesia Tbk (INCO), PT Merdeka Copper Gold Tbk (MDKA), and PT Aneka Tambang Tbk (Antam/ANTM).Moreover, JP Morgan noted, the performance of INCO, ANTM, and MDKA shares was below the Indonesia Stock Exchange's (IDX) composite stock price index (IHSG) ranging from 4-16% in the last month. There are two triggers, namely the correction in metal prices and investors preparing large funds to gobble up stocks that will enter the stock exchange. "Beyond that, the valuation of MDKA shares is already high, with a 2023 PER of 30 times, while ANTM shares are selling at a PER of 2023 of 12 times, close to the regional average," wrote JP Morgan, quoted Monday (6/3/2023) . Based on Investor Daily records, MBM is the largest nickel mining company in Indonesia. MBM holds a 51% stake in PT Sulawesi Cahaya Mineral (SCM), which has Indonesia's largest nickel resources of 1.1 billion tonnes. Of that amount, 69% is limonite, while 31% is saprolite.MBM also owns 50.1% of the shares of three nickel pig iron (NPI) smelters, namely PT Cahaya Smelter Indonesia (CSI), PT Bukit Smelter Indonesia (BSI), and PT Zhao Hui Nickel (ZHN), then 80% of the acid project. ferrous metals (AIM), and 32% shares of Indonesia Konawe Industrial Park (IKIP), an industrial area (KI) built at the SCM mine. MBM plans to build two high pressure leach acid (HPAL) projects that produce mixed hydroxide precipitate (MHP) with a capacity of 120 thousand tonnes of MHP per year at IKIP. His partners are two big players, Tsingshan and Huayou. Meanwhile, DBS noted, Amman Mineral is a world-class producer of copper and gold. According to the Wood Mackenzie report on 13 May 2022, AMI's Batu Hijau mine is ranked second in Indonesia. "Combined with the Elang deposit, AMI has the fifth largest copper reserve in the world," wrote DBS in its research. The associated company PT Medco Energi Internasional Tbk (MEDC) encourages low-cost mining to support revenue. The Batu Hijau mine is expected to be one of the lowest cost copper mines in the world by 2023. “Low cost mining operations will secure AMI profitability with an EBITDA margin of above 60% going forward,” wrote DBS. DBS estimates the fair value of AMI is around US$ 9.1-10.9 billion, based on a combined 2023 EV/EBITDA valuation of 5.9 times and 2023 PER of 11 times. With such a large EV/EBITDA, AMI's valuation is around US$ 9.1-9.7 billion, while with 11 times PER, AMI's valuation is around US$ 9.4-10.9 billion.Meanwhile, CLSA projects AMI's valuation to be around US$ 8.5-12.2 billion. AMI risks include price volatility of copper or gold, state export ban regulations arising from any change in concession granting by the government, as well as operational risks of open pit mining and tailings or waste mining. Previously, AMNT External Communications Manager Ananta Wise was reluctant to comment on the IPO plan. “Thank you for the question. We cannot provide further information regarding this matter," he said. Merdeka Copper Gold Corporate Secretary Adi Adriansyah Sjoekri also could not be asked for confirmation regarding MBM's IPO plan.Source: https://investor.id/market-and-corporate/323756/minggir-dulu-tiga-raksasa-tambang-mau-ipo-rp-22-triliun

The gold mining business development project owned by PT Indika Energy Tbk (INDY) is rolling again. On Thursday (2/3), INDY signed a US$ 250 million credit facility agreement with its subsidiaries, including PT Indika Inti Corpindo, PT Tripatra Multi Energi, PT Tripatra Engineering, PT Tripatra Engineers and Constructors, and Tripatra (Singapore) Pte. Ltd. In this case, the five INDY subsidiaries act as initial guarantors. These five companies are 100% owned by INDY, both directly and indirectly.This agreement was signed with a number of banks. PT Bank Mandiri Tbk (BMRI), PT Bank Negara Indonesia Tbk (BBNI), PT Bank UOB Indonesia, PT Bank DBS Indonesia, PT Bank KB Bukopin Tbk (BBKP) act individually or jointly as regulators. BBNI acts as agent and BMRI as guarantee agent, and BMRI and BBNI respectively act as bank accounts. The facility agreement will be used for the development and construction of the Awak Mas Project from PT Masmindo Dwi Area. In addition to the facility agreement, INDY and the parties involved also signed a facility letter, guarantee confirmation agreement and additional letter for the intercreditor agreement.The facility agreement is guaranteed on a pari passu basis based on the terms in the indenture for Senior Debt Notes with an interest of 5.875% amounting to US$ 575 million and Senior Notes with an interest of 8.250% amounting to US$ 675 million. "This transaction will not have a material impact, but will improve Indika Energy's performance," explained INDY Corporate Secretary Adi Pramono in an information disclosure on the Indonesia Stock Exchange, Tuesday (7/3).Source: https://investasi.kontan.co.id/news/kembangkan-tambang-emas-indika-energy-indy-teken-kredit-sindikasi-us-250-juta

In recent times, the government has submitted plans to limit the construction of nickel smelters. One of the reasons for this limitation is that the supply of high grade nickel, which is widely processed, is dwindling. On the other hand, absorption of low grade nickel is still minimal. Responding to the plan to limit the construction of this new smelter, the Association of Indonesian Processing and Refining Companies (AP3I) assesses that the policy will have an impact on the investment climate that has been built. Secretary General of AP3I Haykal Hubeis said, the discourse on limiting the construction of smelters would certainly elicit responses from potential investors. On the other hand, he is worried that the policies that have taken place in the nickel sector will also apply to other mining commodities."Because nickel is used for locomotive carriages, other smelters will see it there and it can automatically happen to other industries," Haykal told Kontan.co.id, Monday (6/3). Haykal continued, the condition of the upstream sector would certainly have an impact on the downstream industry. Haykal also questioned the government's move, which stated that the supply of raw materials was the reason for limiting the construction of smelters. According to him, this should have been said years ago. He also hopes that the government, especially the Ministry of Energy and Mineral Resources (ESDM) can open data related to the condition of raw materials for mineral commodities. This is to provide an overview of the current condition of reserves and resources.In addition, according to him, currently various downstream policies carried out by the government are more focused on the upstream side. Different conditions occur in the downstream sector where there are no specific regulations governing the smelter industry. "There must be rules, smelters must be made special rules," said Haykal. Haykal continued, the smelter industry is currently facing a number of challenges, namely the large number of permits, infrastructure constraints to the long licensing process. Haykal also hopes that, in addition to regulations for the smelter industry, the government, especially the Ministry of Industry (Kemenperin) must monitor existing smelter projects. This monitoring is necessary to record any obstacles experienced by each smelter project.Source: https://industri.kontan.co.id/news/pemerintah-akan-batasi-pembangunan-smelter-pengusaha-smelter-bilang-begini

Australia-based Nickel Industries on Monday unveiled plans for a 67 000 t/y high-pressure acid leach (HPAL) project, in Indonesia, that would cost no more than $2.3-billion to bring to nameplate capacity. The ASX-listed company announced revised terms for the Dawn HPAL+ project which forms part of an electric vehicle battery supply chain strategic framework agreement that it entered into with Shanghai Decent in January this year.The new terms include the nameplate capacity boost and a “capex guarantee” whereby the total construction and commissioning will not exceed $2.3-billion. The agreement previously committed to a maximum of $2.5-billion. In addition to producing a mixed hydroxide precipitate (MHP), the project – to be known as the Excelsior Nickel Cobalt project (ENC) – will be capable of producing both nickel sulphate and nickel cathode.This differentiates it from the current generation of HPAL plants currently being constructed across Indonesia, and provides Nickel Industries with significant operating flexibility through the cycle. Nickel Industries MD Justin Werner said the ability of the project to produce not only MHP, but also go further downstream to produce nickel sulphate and nickel cathode, would allow for greater margin capture. “[This will] make us one of the first truly diversified HPAL producers with a mix of class 1 nickel products that can be selectively sold into different sectors of the nickel market as pricing dynamics dictate,” he stated.Nickel Industries and Shanghai Decent were currently working on a feasibility study for ENC ahead of a final investment decision by Nickel Industries’ board. Construction is expected to start in December 2023, or March 2024, or anytime earlier that both parties agree. Following this, commissioning will start no later than 24 months thereafter. Nickel Industries would own a 60% to 70% equity interest in the project with Shanghai Decent owning 30% to 40%; however, both parties were open to the introduction of other strategic partners which may lead to a dilution of these interests.“Most importantly, the $2.3-billion capital expenditure guarantee we have secured represents a highly competitive capital intensity compared to several recently announced projects, particularly considering this cost guarantee goes beyond purely engineering, procurement and construction costs and is inclusive of seeing the project delivered to operational nameplate capacity,” said Werner.The capex guarantee also includes a tailings solution which is best in breed for tailings storage and management, and an integrated sulphuric acid plant which will generate significant heat that can be turned into power lowering the carbon footprint significantly. “Given the recent slew of announced capex blowouts in the nickel and battery metals industry, the value of a capex guarantee to deliver a leading HPAL solution cannot be overstated,” he said.Nickel Industries also reported that it had reached agreement with Shanghai Decent to switch two of Angel Nickel’s rotary kiln electric furnace lines to the production of nickel matte. Following the successful switch of Hengjaya Nickel’s production from nickel pig iron to nickel matte in the December quarter of 2022, two of Angel Nickel’s rotary kiln electric furnace lines will undergo minor capital modifications to the value of $2-million to enable the transition to matte production. The switch to nickel matte production, which will be subject to market conditions, is not expected to occur until early 2024, as low-grade to high-grade converter capacity is currently under construction within the Indonesia Weda Bay Industrial Park. Source: https://www.miningweekly.com/article/revised-terms-for-dawn-hpal-project-lifts-nameplate-capacity-lowers-capex-guarantee--nickel-industries-2023-03-06/rep_id:3650

PT Aneka Tambang Tbk (ANTM) is optimistic that the development of the electric vehicle battery ecosystem business will be increasingly encouraged in the future. Previously, President Joko Widodo issued Presidential Decree No. 3 of 2023 which granted permits for mining in forest areas for two Aneka Tambang companies. Meanwhile, Presidential Decree Number 3 of 2023 concerning Amendments to Presidential Decree Number 41 of 2004 concerning Licensing or Agreements in the Mining Sector Located in Forest Areas specifically stipulates permits for two companies namely PT Sumber Daya Arindo and PT Nusa Karya Arindo.ANTM Corporate Secretary Division Head Syarif Faisal Alkadrie positively welcomed the presence of this regulation. According to him, the granting of this permit is government support for the development of electric vehicle batteries by ANTM. "We believe that the existence of this Presidential Decree will bring good benefits to our subsidiary, Antam and the government because it will increase investment in North Maluku, and support the development of the Indonesian EV Battery ecosystem," Faisal told Kontan, Friday (3/3). Faisal said that later the two subsidiaries would manage the electric vehicle battery business by collaborating with strategic partnersIn this regulation, it is also ensured that there will be no change in the size of the area. In the previous regulation, the total area of the ANTM permit area was set at 39,040 Ha. The three companies are listed as producing nickel in the form of minerals. Meanwhile, if you refer to the latest regulation attachment, the land licensing areas are now divided as follows, PT Aneka Tambang Tbk (ANTM) of 3,648 Ha, PT Sumber Daya Arindo of 14,421 Ha and PT Nusa Karya Arindo of 20,763 Ha. ANTM targets ferronickel production and sales in 2023 to reach 27,201 TNi. This target has increased by 12% from actual production and sales throughout 2022, which amounted to 24,334 TNi and 24,210 TNi respectively.Meanwhile, for nickel ore this year, it is targeted to produce 11.30 million wet metric tons (wmt). This number increased by 31% from the achievement of nickel ore production in 2022 which reached 8.62 million wmt. It is noted that currently ANTM is continuing to complete the project construction of a ferronickel plant with a capacity of 13,500 TNi per year in East Halmahera along with supporting infrastructure for the factory which has entered the project construction phase.Source: https://industri.kontan.co.id/news/aneka-tambang-antm-optimistis-pengembangan-bisnis-ekosistem-baterai-bakal-tumbuh

PT Mifa Bersaudara, a coal mining company located in West Aceh Regency, targets revenue to grow 15% following the growth in coal production volume throughout this year. This projected increase in financial performance also considers coal commodity prices which are not much different from 2022. General Manager Operation Mifa Bersaudara, Hadi Firmansah, explained that several experts projected that coal prices would still be in a strong position in the next two to three years. “But in the three years since, prices have started to decline again. But we went through a time when coal prices were at their lowest point in 2015-2016 and we were still able to operate," he explained when met in Bogor, Saturday (26/2). In order to deal with the decline in coal commodity prices, Mifa Bersaudara will optimize existing business processes and efficiency of some production costs.Throughout this year, the Mifa Brothers have planned a coal production volume of 8 million tons. Meanwhile, when combined with the production of its sister company, PT Bara Energi Lestari, which often uses infrastructure from Mifa, the total coal production will reach 10.6 million tons this year. "Compared to last year, there was an increase of 1.3 million tons. This increase is due to increased demand," he said. Apart from selling domestically, the Mifa Brothers export their coal to a number of countries, namely to China, India, Thailand and Vietnam.Hadi explained, currently there are around 170 million coal reserves with a mine life of up to 2035. Seeing this condition Mifa Bersaudara plans to diversify its business into mineral mining. "Mifa's holding is PT Media Djaya Bersama, we are now diversifying towards nickel. However, the holding party is still looking for targeted nickel mining areas," he explained.Source: https://industri.kontan.co.id/news/mifa-bersaudara-targetkan-pendapatan-tumbuh-15-di-2023

The core profit of PT Adaro Minerals Indonesia Tbk (ADMR) skyrocketed 112.42% in 2022 along with a 97% increase in revenue. This growth was driven by an increase in production volume and coal prices over the past year.Christian Ariano Rachmat, President Director/Chief Executive Officer of PT Adaro Minerals Indonesia Tbk (ADMR) said that the company posted a profit of US$ 342 million, up from US$ 161 million in 2021. The increase in profit was driven by revenue growth to US$ 908.14 million, from a similar period in 2021 as much as US$ 460.17 million."Performance throughout 2022 has been satisfactory in terms of conducive market conditions, seen in the strong prices in 2022," he said in a press release quoted on Thursday (2/3).The average selling price (ASP) rose 42% and sales volume rose 39% to 3.2 million tonnes from 2.30 million tonnes in 2021. Overburden removal reached 8.32 mbcm, up from 5.15 mbcm during 2021. (LK/LM)Source: https://www.idnfinancials.com/news/46170/admr-posts-profit

PT Petrosea Tbk (PTRO) officially launched the Minerva Digital Platform for a coal mining project owned by PT Indo Bara Pratama (IBP) in Kembang Janggut, Kutai Kartanegara Regency, East Kalimantan. In the IBP project, Petrosea carries out project management work, which includes implementing operational excellence and technology solutions through the Minerva Digital Platform which is Petrosea's latest digital technology solution. This work includes mining in the pit to transporting coal to the port (pit to port activity) with the principles of good mining practices. In this regard, Petrosea also plans to implement a dozer push solution in mining activities at IBP.Petrosea is the only contractor that has conducted dozer push mining in Indonesia. Project management carried out by Petrosea is a new business model by collaborating with local contractors around the mining area. Petrosea assists local contractors to improve performance in mining productivity. This is done by implementing Petrosea's processes, procedures and standards so that operational excellence runs well and production targets can be achieved. In addition, the application of digital technology also plays an important role in maintaining mining operations, from pit operations to ports. All initiatives are controlled and monitored through the Minerva Digital Platform which is supported by a real-time and accurate Fleet Management System (FMS).This FMS system, which is applied to these smaller capacity devices, is the result of Petrosea's collaboration with local Indonesian partners. These tools will accelerate corrective actions quickly and accurately, so that the production process is not disrupted. "Petrosea has started a digital transformation of its mining operations in 2018 and thanks to its success it has received recognition from the World Economic Forum as a lighthouse company. We continue to develop digitalization at Petrosea to further increase productivity in all mining projects, including the IBP project," said Petrosea's President Director, Romi Novan Indrawan was quoted on Thursday (2/3). In running its business, Petrosea is fully supported by Haji Romo (Robert) Nitiyudo Wachjo who is the majority shareholder of one of the largest gold mines in Indonesia, PT Nusa Halmahera Minerals and PT Caraka Reksa Optima which is the main shareholder of PT Petrosea Tbk.Going forward, Petrosea's strategy under the leadership of Haji Robert is to continue to diversify its business into other mineral sectors through the provision of mining and engineering, procurement & construction (EPC) services on an ongoing basis. In addition, Petrosea's long-term strategy is to reposition from a mining contractor to a mine owner in order to strengthen the company's performance and provide added value to all stakeholders in the future. The launch event for the digitalization of the IBP project was carried out online from the Remote Operations Center (ROC) located at the Petrosea-Bintaro head office, where IBP management was represented by Russel Powell as Director. Meanwhile, Petrosea's management was represented by Romi Novan Indrawan as President Director, Rafael Nitiyudo as Vice President Director and Iman Darus Hikhman as Director of Mining & Business Development. Also present at this event were the IBP operational and technical teams to witness firsthand.Source: https://www.cnnindonesia.com/ekonomi/20230302143827-97-919901/petrosea-luncurkan-digitalisasi-operasional-tambang-di-proyek-ibp

Throughout 2022, PT Indo Tambangraya Megah Tbk (ITMG), recorded net sales of US$ 3.6 billion. Indo Tambangraya's sales shot up 75 percent from the previous year of around US$ 2.07 billion. Main Director of ITMG Mulianto said the increase in sales in 2022 was driven by the average selling price of coal of US$192 per ton, an increase of 86% from the previous year of around US$103 per ton. Meanwhile, the gross profit margin rose from 44% to 52% in 2022 amid rising global fuel prices, rising royalties, and various battles and challenges throughout 2022. Along with the increase in the acquisition of the average coal price, ITMG recorded a strengthening of cash flows with EBITDA reaching US$ 1.8 billion in 2022, up 101% from the previous year. Meanwhile, net profit rose 152% to US$ 1.2 billion in 2022 from US$ 475 million in 2021."By implementing prudent cash management, Indo Tambangraya has managed to maintain an increasingly solid balance sheet," said Mulianto in an official statement, Wednesday (1/3). Until the end of December 2022, ITMG's total assets were US$ 2.6 billion with a total equity of US$ 2 billion. In line with stronger cash flow and EBITDA, ITMG also has a solid cash and cash equivalent position of US$1.4 billion. The net profit per share was recorded at US$ 1.07 per share. Mulianto said that throughout 2022, ITMG produced 16.6 million tons of coal amidst high rainfall. Meanwhile, sales volume reached 18.9 million tons, of which around 5.9 million tons were marketed to China, 4.2 million tons to India, 2.9 million tons to Japan, 1.5 million tons to the Philippines, and 1.5 million tons to India. 1.1 million tons, other countries in Asia Pacific, and Europe.Source: https://investasi.kontan.co.id/news/penjualan-indo-tambangraya-itmg-naik-75-terangkat-harga-jual-batubara

Director of HILL Jaya Angdika in a press conference at the Main Hall of the Indonesia Stock Exchange (IDX), Jakarta, Wednesday, stated he was optimistic that the company's revenue could reach IDR 6 trillion in 2023, with a net profit of IDR 700 billion to IDR 800 billion. In addition, he is optimistic that the volume of nickel mining production can reach 15 million metric tons of nickel in 2023, from as many as 9 million in 2022. HILL also targets coal and nickel mining services to be balanced, each contributing 50 percent of the company's revenue. Hillcon officially listed its initial public offering (IPO) by raising funds worth IDR 552.8 billion, almost half of which will be used to develop the nickel industry in the country.HILL issued 442.3 million new shares or 15 percent of the company's issued and fully paid-up capital, with an offering price of IDR 1,250 per share. As the world's largest nickel producer, Indonesia is predicted to produce around 1.2 million tons of nickel in 2022, equivalent to 37.5 percent of total global production. Indonesia is also the second largest stainless steel producer in the world after China. In terms of nickel reserves, Indonesia has a share of 22 percent or the equivalent of 21 million tons of metallic nickel, and is predicted to remain the largest contributor to nickel ore and nickel ore supplies in the world, with an estimated market share of 38 percent by 2024.Source: https://www.antaranews.com/berita/3419550/hillcon-targetkan-45-persen-pendapatan-dari-jasa-tambang-nikel-di-2023