Final investment decision (FID) based on its participation in the Excelsior nickel/cobalt HPAL project in Indonesia.

Australian nickel developer, Nickel Industries, will proceed with plans for its participation in the development of the Excelsior Nickel Cobalt (ENC) HPAL project to produce battery-grade nickel products. The plant will be located within the Indonesia Morowali Industrial Park (IMIP) with production anticipated to commence in Q4 2025. ENC is being designed to produce 72ktpy Ni across three main nickel products: mixed hydroxide precipitate (MHP), nickel sulphate, and nickel cathode.

As part of the announcement, Nickel Industries revealed it would acquire a 55% interest in ENC based on a payment of US$1.26Bn, paid over next two years in instalments. Nickel Industries is developing the project in collaboration with Shanghai Decent (Tsingshan) with a placement deal struck with PT Danusa Tambang Nusantara (DTN), a subsidiary of PT United Tractors, to give the latter a 20% stake in ENC. Shanghai Decent will also provide a “capex guarantee” to ensure construction costs do not exceed US$2.3Bn.

The news is particularly noteworthy for two reasons: firstly, this is another pledge by Western interests to invest in Indonesian battery-grade nickel production. Besides Nickel Industries, Eramet, BASF and Ford are all planning HPAL projects in the country. Nickel Industries already has a strong presence in Indonesia through its acquisition of rotary kiln electric furnace (RKEF) lines producing nickel pig iron (NPI) and high-grade nickel matte at IMIP and the Indonesia Weda Bay Industrial Park (IWIP). Secondly, this is the first HPAL being developed with a truly integrated optionality to produce MHP, or downstream nickel sulphate or nickel cathode, depending on market conditions. Over the past year, high LME nickel prices and steep nickel sulphate discounts have effectively opened a ‘nickel product arbitrage’ for refined products, resulting in Chinese producers including Huayou seeking to deliver material on the LME to take advantage of the higher margins.

This development takes the number of HPAL projects planned in Indonesia and being tracked by Project Blue to 14 (excluding multiple phases).