Vale teams with China’s GEM for planned $1.4B Indonesian nickel plant

Vale’s (NYSE:VALE) Indonesia unit and Chinese battery metal producer GEM Co. signed an agreement to build a $1.42B nickel plant in the Southeast Asian country, Bloomberg reported Monday.

The companies signed a framework agreement for a high-pressure acid leach facility to process nickel laterite ore from the Vale (VALE) unit into 66K tons/year of mixed hydroxide precipitate, a form of nickel aimed at automakers.

GEM will own as much as 25% in the project, the Vale (VALE) unit will hold 30%, and an unnamed third party will take the remainder, according to the report, which also said Vale and GEM also will consider building downstream anode and precursor plants.

Indonesia accounts for more than half of global nickel production and has been seeking overseas investment in its processing industry to exploit demand for electric vehicle batteries.