WionDrive News Desk 
French mining company Eramet announced on Monday, June 25, that it has decided, in conjunction with German chemical company BASF, to cancel their joint investment project for a nickel-cobalt refining complex in Weda Bay, Indonesia. The project had been valued at USD 2.6 billion.
In a news release, Eramet stated, “After a thorough evaluation, including discussions about project execution strategy, both partners have decided against this investment.” The company did not provide further details about the reasons behind this decision.
Despite the cancellation of this specific project, Eramet indicated that it remains interested in the Indonesian market and the electric vehicle (EV) battery supply chain. The company stated, “Eramet will continue to evaluate potential investments in the nickel electric vehicle battery value chain in Indonesia and will keep the market informed in due course.”
An Indonesian government official confirmed that both companies had informed the government about their decision. Sepian Hario Seto, a senior official at Indonesia’s Coordinating Ministry of Maritime and Investment Affairs, provided some insight into the possible reasons for the cancellation. He suggested that the decision might be related to the existing and planned high pressure acid leach (HPAL) facilities already present in the country.
Seto explained, “I think this cancellation was because they saw that there was already a lot of HPAL in Indonesia, so it is easier to get MHP (mixed hydroxide precipitate), so there was no need to spend large capex to build it by themselves.” This statement suggests that the availability of existing facilities and the potential to source materials like MHP might have influenced Eramet and BASF’s decision to cancel their own project.
The context for this decision is important to consider. Indonesia, rich in nickel resources, has been actively pursuing the development of a domestic electric vehicle industry. As part of this strategy, several Chinese companies and their local partners have already invested in HPAL facilities in the country. These existing investments may have altered the market dynamics and affected the viability of the Eramet-BASF project.
This development highlights the evolving landscape of the nickel and EV battery supply chain in Indonesia. It also underscores the complexities and strategic considerations that international companies must navigate when planning large-scale investments in the country’s resource sector.
While the cancellation of this specific project represents a significant change in plans for Eramet and BASF, it does not necessarily signal a complete withdrawal from the Indonesian market. Eramet’s statement about continuing to evaluate potential investments suggests that the company still sees opportunities in Indonesia’s nickel and EV battery sector, albeit potentially through different strategies or project structures.
As the global demand for electric vehicles continues to grow, and with it the demand for nickel and other battery materials, Indonesia’s role as a key supplier is likely to remain significant. How international companies like Eramet and BASF choose to engage with this market in the future will be an important trend to watch in the evolving global EV supply chain.
