The Energy and Mineral Resources Ministry has reported that at least 19 metal processing and refining facilities are currently either under construction or subject to feasibility study as part the country's efforts to comply with a law banning ore exports beginning 2014.
Of the 19 facilities, seven are now in the construction phase, six under examination for feasibility and the remaining six have just obtained construction permits. Those facilities will begin commercial operations between 2012 and 2017.
Mr Thamrin Sihite minerals and coal director general said that "This year, an iron smelter producing sponge iron with a total production capacity of 500,000 tonnes per year will begin operations. The smelter is being built by Indoferro."
The construction of the processing and refining facilities is part of the mining industry’s efforts to meet the requirement of the 2009 Law on Minerals and Coal, which has ordered a stop to ore exports in two years' time.
The requirement is contained in the 2012 ministerial regulation on added value for mineral commodities through processing and refining, which was issued recently as part of the implementation of the law. The regulation sets minimum limits of mineral content in processed products for export. For instance, for copper, gold and silver, the limit is 99%.
Mr Thamrin explained that "This policy aims to conserve our natural resources as well as improve their economic benefits. If the ores are refined, their value will increase. The presence of smelters will also provide job opportunities for locals."
According to the ministry's data, state miner PT Aneka Tambang plans to build four smelters in Halmahera, North Maluku (ferronickel); Mandiodo, Southeast Sulawesi (nickel pig iron); Mempawah, West Kalimantan (smelting grade alumina) and Gresik, East Java (gold, silver and copper).
However, the Gresik project has been suspended due to the results of a study that says the project is not economical.
State steel maker PT Krakatau steel and Korea based POSCO have also teamed up to build a production plant in Cilegon, Banten, with a total production of 3.5 million tonnes of steel plate, 2.5 million tonnes of steel slab and 3 million tonnes of hot rolled coil steel per year.
Nickel producer PT Vale Indonesia is now conducting a feasibility study for building a smelter in Pomalaa, Southeast Sulawesi, with a production capacity of 48,800 tonnes per year. The smelter is projected to begin operations in 2017.
Regarding coal in Prabumulih, South Sumatra, Pendopo Coal Gasification and Pendopo Coal Upgrading are also conducting feasibility studies for coal gasification and coal upgrading facilities. The coal gasification is expected to start in 2016 and the coal upgrading in 2013.
As reported earlier, the government has given three months for all mineral mining companies in the country to submit comprehensive proposals on their strategies to comply with the ore export ban in 2014.
The proposals must include how they will process and refine their raw commodities, whether they will build their own smelters, cooperate with other companies to build smelters or refine their ore in external smelting plants.
|PI Anoka Tambang||Halmahera, North Maluku||Ferronickel||77,000 tons of FeNi/year|
|PT Anoka Tambang||Mandiodo, North Konawe, Southeast Sulawesi||Nickel Pig iron||170,000 tons/year|
|PI Aneka Tambang||Mempawah, West Kalimantan||Smelting Grade Alumina||1 million tons of SGA/year|
|PT Indonesia Chemical Alumina||Tayan, West Kalimantan||Chemical Grade Alumina||300,000 tons of SGA/year|
|PT Vale Indonesia||Pomalaa, Southeast Sulawesi||Nickel Hidrocode||48,800 tons/year|
|PT Weda Bay Nickel||Weda, North Maluku||Nickel Hidrocode||60,000 tons/year|
|Meratus Jaya Iron & Steel||Batu Lecin, South Kalimantan Glegon, Banten||Sponge Iron||315,000 tons/year|
|Indoferro||Sponge Iron||500,000 tons/year|
|PT Sebuku iron Lateritic||Sebuku, South Kalimantan||Sponge Iron||1 million tons/year|
|PT Krakatau Steel POSCO||Cilegon, Banten||Steel||3.5 million tons of plates/year, 2.5 million tons of slab/year, 3 million tons of HRC/year|
|PT Nusantara Smelting||Bontang, East Kalimantan||Copper Cathode||200.000 tons/year|
|PT Aneka Tambang||Gresik East Java||Gold, Silver etc||2,000 tons/year|
|PT Indosmelt||Maros, South Sulawesi||Copper Cathode||100,000 tons of copper cathode, 200,000 tons of copper stag|
|Pendopo coal Gasification||Prabumulih, South Sumatra||Coal Gasification|| |
|Pendopo Coal Up Grading||Prabumulih, South Sumatra||Upgraded Coal||5 million tons/year|
|PT Dairi Prima Mineral||Dairi, North Sumatra||Lead and Zinc concentrate||110,000 tons of lead/year and 220,000 tons of zinc/year|
|PT Agincourt Resources||South Tapanuli. North Sumatra||Dore Bullion||250,000 tons of gold/year and 2.5 million tons of silver/year|
|PT Jinghuang Indonesia||Morowali, Southeast Sulawesi||Sponge ferronickel||2 million tons/year|
|PT Timah||Olegon, Banten||Tin Chemical||500,000 tons/year|
Source - Energy and Mineral Resources Ministry