LG Chemical plans to build a plant in Indonesia for US $9.8 billion? A number of domestic listed companies are the first to invest in the nickel industry.

According to several media reports, Indonesian Investment Minister Bakhli (Bahlil Lahadalia) said in an interview that the car battery factory of Ningde Times, in cooperation with LG Chemical and Indonesia's state-owned mining holding company (MINDID), is scheduled to open in August this year. According to the Internet, LG Chemical invested US $9.8 billion and Ningde Times invested US $5.2 billion.

It is reported that the Indonesian state-owned mining company is composed of Antam (Antam), Indonesian aluminum (Inalum) and Indonesian national power (PLN). On May 11th, Orias (Orias Petrus Moedak), chairman of Indonesia's state-owned mining company, announced via video that the company's $2 billion investment plan has been approved by the central government to finance several major projects of the holding company.

Indonesia has the largest proved nickel reserves in the world.

Earlier this month, foreign media said that LG Chemical and the Indonesian Investment Coordination Committee signed an agreement that South Korean lithium power companies, led by LG Chemical, will reach a cooperation with Indonesian industrial group (IBI), with the goal of establishing a complete power battery supply chain in Indonesia.

According to the cooperation between the two sides, LG Chemical will lead its LG Chemistry and LG International, as well as Posco and China's Huayou Cobalt to invest and set up plants in Indonesia, including nickel mining, refining, power battery production and so on.

In mid-2020, it was also reported that South Korea's Hyundai Motor and LG Chemical were considering forming a joint venture in Indonesia to produce electric car batteries.

Battery Network noted that at the end of 2020, it was also reported that Ningde Times plans to invest 5 billion US dollars to build a lithium battery factory in Indonesia, which is scheduled to start production in 2024. At the same time, rumors abound that Tesla, a joint customer of LG Chemical and Ningde Times, plans to build a factory in Indonesia.

According to global data, world mine nickel production will grow at an average annual rate of 4.2% during the forecast period (2021-2024) and will reach 2.64 million tons by 2024. The agency expects the increase to come mainly from Indonesia, Australia, the Philippines and Canada, whose combined production will increase from 1.42 million tons in 2021 to 1.64 million tons in 2024.

According to the data released by the US Geological Survey, Indonesia has the largest proven nickel reserves in the world, about 21 million tons, accounting for 24% of the world. At present, Indonesia is also the world's largest nickel producer and exporter.

However, in recent years, Indonesia has begun to restrict nickel exports and even advanced the export ban to January 2020 to attract investors to invest in the construction of new energy vehicles and power battery production bases in Indonesia.

Chinese enterprises seize the first opportunity for nickel resources

Combing through the battery network, it is found that in recent years, under the general trend of the rapid development of global new energy-powered ternary batteries in the direction of high nickel and low cost, in order to seize the opportunity of nickel resources, a number of domestic enterprises, such as Yiwei LiNeng, Green Mei, Qingshan Industry, Huayou Cobalt, Zhongwei, Luoyang Molybdenum, and so on, have announced their investment in the nickel industry in Indonesia.

On May 24th, Yiwei Asia, a wholly-owned subsidiary of Yiwei LiNeng (300014), signed the "Indonesia Huayu Nickel Cobalt laterite Nickel Wet smelting Project Joint Venture Agreement" with Yonghui, Glaucous, Huayou International Cobalt and LINDO. The parties agreed to set up a joint venture company in Indonesia to implement laterite nickel hydrometallurgy project with an annual output of about 120000 tons of nickel and about 15000 tons of cobalt.

On April 7, 300919, Zhongwei Co., Ltd. (300919) examined and approved the motion on the signing of a joint venture agreement between Zhongwei Hong Kong New Energy and RIGQUEZA, a wholly-owned subsidiary, on the project of smelting 30,000 tons of high nickel-containing nickel in laterite (Indonesia). The wholly-owned subsidiary Zhongwei Hong Kong New Energy and RIGQUEZA signed a joint venture agreement on the project of smelting 30,000 tons of high nickel-containing nickel (Indonesia) in laterite smelting, with a total investment of about 243 million US dollars (about 1.6 billion yuan). Among them, the first phase of the project plans to produce 10, 000 tons of high matte and nickel-containing metal per year, with a total investment of about 81 million US dollars.

On March 23rd, Greengmei (002340) announced that Hong Kong Bang Pu would transfer its 15 per cent stake and corresponding rights and obligations to Grammy Hong Kong, which agreed to transfer 15 per cent of Qingmei Bang. In addition, Newstride Limited sold 100% of the shares of Xin Zhan International to Green Meibang Hong Kong to indirectly sell 21% of the shares of Green Meibang, which agreed to accept the 21% stake in Green Meibang. After the completion of the transaction, Green Mei Hong Kong will increase its total direct and indirect shareholding in Qingmeibang to 72%, becoming the controlling shareholder of Qingmeibang.

Greenmei also revealed recently that the Indonesian HPAL project with an annual production capacity of 150000 tons of nickel sulfate crystals, in cooperation with Castle Peak Industries and CATL, is accelerating and is scheduled to be completed in 2021 and put into operation in early 2022 to meet the company's strategic needs for nickel resources for the development of precursor materials.

On March 15, Huayou Cobalt (603799) said on the investor interactive platform that the construction of the 60, 000-ton nickel-cobalt hydroxide wet smelting project in Indonesia is progressing normally and is expected to be completed for trial production by the end of 2021.

On the afternoon of March 1, Qingshan Industries signed a high matte supply agreement with Huayou Cobalt and Zhongwei, which will supply 60,000 tons of high matte to Huayou Cobalt and 40,000 tons of high matte to Zhongwei in one year starting from October 2021. Castle Peak Industries began trial production of high nickel matte in Indonesia in July 2020, producing high nickel matte with more than 75% nickel content. The process was successfully trial-produced at the end of 2020 and has been able to steadily supply high-quality matte.

Aoyama Industries said it will continue to increase investment in the Indonesian nickel industry, with an estimated production of 600000 tons of nickel equivalent in 2021, 850000 tons of nickel equivalent in 2022 and 1.1 million tons in 2023. Among them, the output of high matte and ferronickel will be switched and adjusted according to market demand and price changes.

In response to questions from investors, Luoyang Molybdenum Industry (603993) said that the Indonesian nickel-cobalt hydrometallurgical project is still under construction.

It is reported that Huayue Nickel and Cobalt (Indonesia) Co., Ltd. was established in November 2018 and is composed of joint ventures such as Huayou Cobalt, Luoyang Molybdenum and Qingshan Industry. it will be launched in the second half of 2018 and is expected to be put into trial production by the end of 2021. After the project is put into production, it has the ability to produce 60,000 tons of nickel metal per year, and the product will be mainly used in the cathode material of new energy automobile battery, and the market application prospect is broad.