Two high-pressure acid leach (HPAL) projects being constructed at the Indonesia Morowali Industrial Park (IMIP) will not feature deep-sea tailings placement (DSTP) according to Nani Hendiarti, an official at the Coordinating Ministry for Maritime Affairs and Investment for Indonesia. PT Hua Pioneer Indonesia, which is in charge of overseeing waste disposal at IMIP, decided to withdraw its request for this method of tailings disposal owing to “complexities of the impact of sea tailing” and is now “seeking other technological options” according to quotes made by Hendiarti to Reuters.
The news could prove to be a very significant development in the narrative surrounding sustainable sourcing of nickel for the EV battery supply chain. The controversial method of DSTP involves piping tailings left behind after hydrometallurgical processing of laterite ores out to sea at great depths.
The decision by PT Hua Pioneer Indonesia not to proceed with DSTP will likely impact the two HPAL projects at IMIP as they will now need to consider alternative on-land tailings storage, potentially involving dry stacked tailings. This could result in further delays to their development and add additional costs. Both PT QMB New Energy Materials (Tsingshan, GEM, Brunp/CATL) and PT Huayue (Huayou, China Molybdenum, Tsingshan) are being developed at IMIP to produce 50ktpy Ni-in-mixed hydroxide precipitate (MHP) and 60ktpy Ni-in-MHP respectively, targeting the battery market. PT QMB New Energy Materials intends to process the battery-grade nickel intermediates to nickel sulphate on site, while PT Huayue will export MHP output for conversion to nickel sulphate in China.
A third Indonesian project targeting the production of battery-grade nickel is located on Obi Island, which Roskill believes to be the most advanced. PT HPL, a JV between Harita Group and Ningbo Lygend, is targeting a capacity of 37kt Ni in MHP (first phase). Significantly, Harita Group announced earlier this year that it is undertaking a feasibility study on DSTP. Whether PT Hua Pioneer Indonesia’s move to scrap plans for DSTP could influence PT HPL’s decision to proceed with this tailings disposal remains to be seen.
Clearly, environmental concerns from all stakeholders involved along the EV battery supply chain are starting to become impossible to ignore. Tesla boss Elon Musk has already declared that his company intends to prioritise sourcing nickel that has been mined in an “environmentally sensitive way”. Following reports that Vale have been in discussions about supplying Tesla with nickel from its Canadian operations, the Indonesian government has also revealed that it is now in early stage talks with Tesla over a potential investment in the country. Perhaps the timing to drop DSTP at IMIP is no coincidence.
Roskill will publish updates to both its Nickel: Outlook to 2029 16th Edition and Nickel Sulphate: Outlook to 2029 3rd Edition reports this month. The updates will provide analysis on the latest developments to supply and demand amid changes to global macroeconomics. Along with providing an update to Roskill’s nickel market balance and price forecasts, they will also include the latest key industry news developments.