At least 19 smelters will begin operation within next five years: Govt

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, the Energy and Mineral Resources Ministry has reported.

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, The Jakarta Post reported on Wednesday.

This year, an iron smelter producing sponge iron with a total production capacity of 500,000 tons per year will begin operation. The smelter is being built by Indoferro, said minerals and coal director general Thamrin Sihite in Jakarta on Tuesday.

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 percent. ?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;? Thamrin explained.

According to the ministry?s data, state miner PT Aneka Tambang (Antam) 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 tons of steel plate, 2.5 million tons of steel slab and 3 million tons 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 tons per year. The smelter is projected to begin operation 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 2014 ore-export ban.

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. (*)

No	Company	Location	Product	Production Capacity	Operation
1	PT Aneka Tambang	Halmahera North Maluku	Ferronikel	27.000 tons of FeNy/year	2014
2	PT Aneka Tambang	Mandiodo, North Konawe,Southeast Sulawesi	Nickel Pig Iron	120.000 tons/year	2014
3	PT Aneka Tambang	Mempawah,West Kalimantan	Smelting Grade Alumina	1 million of SGA/year	2014
4	PT Indonesia Chemical Alumina(Ica)	Tayan, West kalimantan	Chemical Grad Alumina	300.000 tons of SGA/year
5	PT Vale Indonesia(inco)	pomalaa,southeast sulawesi	Nikel Hidroxide(Nio Dan Coo)	48,800 tons/year	2017
6	PT weda Bay Nikel	Weda North Maluku	Nikel Hidroxide(Nio Dan Coo)	60.000 tons/year	2016
7	meratur jaya iron& steel	batu licin, South Kalimantan	Sponge Iron	315.000 tons/year	2014
8	indoferro	Cilegon , Banten	Sponge Iron	500.000 tons/year	2012
9	PT Sebuku Iron Lateritic	Sebuku, South Kalimantan	Sponge Iron	1 million tons/year	2014
10	PT Kerakatau Steel Posco	Cilegon , Banten	Steel	3,5 million ton of plate/year 2,5 million ton of slap/year 3 million HRC/year	2014
11	PT Nusantara Smelting	Bontang, East Kalimantan	Copper Cathode	200.000 tons/year	2014
12	PT Aneka Tambang	Gresik, East Java	Gold, Silver,etc	2.000 tons/year	?
13	PT Indosmelt	Maros, South Sulawesi	Copper Cathode	100.000 tons of copper cathode, 200.000 tons of copper slag	2014
14	pendopo coal gasification	Prabumulih, South Sumatra	Coal Gasification	?	2016
15	pendopo coal up grading	Prabumulih, South Sumatra	Upgraded Coal	5 million tons/year	2013
16	PT Dairi Prima Mineral	Dairi, North Sumatra	Lead And Zinc Concentrate	110. 000 tons of lead/year and? 220.000 tons of zinc/ year	2014
17	PT Agincourt Resources	South Tapanuli,North Sumatra	Dore Bullion	250.000 tons of gold/year and 2,5 million tons of silver/year	2015
18	PT Jinghuang Indonesia	Morowali, Southeast Sulawesi	Sponge Ferronikel	2 million tons/year	?
19	PT Timah	Cilegon , Banten	Tin Chemical	500.000 tons/year	2015
Source: Energy and Mineral Resources Ministry