The three-party collaboration will produce nickel intermediates from Pomalaa destined for use in Ford’s EV batteries.

PT Vale Indonesia, Huayou Cobalt and Ford have taken a definitive agreement to each make equity investments in the Pomalaa high-pressure acid leach (HPAL) project located in Sulawesi, Indonesia. The US$4.5Bn-rated plant, to be operated by PT Kolaka Nickel Indonesia, will produce 120ktpy Ni-in-MHP and source laterite ore from PT Vale’s Pomalaa Block mine. Site preparations have already commenced and full construction is expected this year with a view to starting commercial operations by 2026. Mixed hydroxide precipitate (MHP) from the plant will be further processed to produce nickel sulphate and ternary precursor cathode active materials (pCAM). The decision to proceed with the project represents a swift change in Pomalaa’s fortunes after a long-standing JV between Vale and Sumitomo Metal Mining (SMM) collapsed in April 2022.

Ford has a history of actively engaging in its upstream supply chains. The automotive company’s founder, Henry Ford, did so to avoid supply shortages that would cause disruption to its assembly lines. Fast forward to 2023 and Ford is again proactively sourcing key raw materials, this time nickel, for use in its new fleet of electric vehicles. The nickel from Pomalaa and a separate agreement under development between Ford and Huayou for the latter to supply pCAM will assist the company in achieving its goal to reach a production rate of 2M EVs by the end of 2026. It remains to be seen whether teaming up with Chinese company Huayou will impact Ford’s eligibility to qualify for US inflation reduction act (IRA) tax credits. Vale reportedly owns a 30% stake in the Pomalaa project with the remaining share balance between Ford and Huayou undisclosed.

As well as locking in a large proportion of the company’s future nickel requirements, Ford’s involvement in Pomalaa means that it can influence aspects of the project including ESG, which is widely considered the main drawback of nickel produced in Indonesia for EV batteries. The automotive sector’s race to procure nickel units continues to heat up.