Two of the world electric vehicle battery manufacturers, Contemporary Amperex Technology Co. Ltd (CATL) and LG Chem Ltd will invest around $20 billion or the equivalent of IDR 294 trillion (exchange rate IDR 14,700/US $) in the battery project in Indonesia.
The companies signed an agreement with PT Aneka Tambang (Antam) Tbk last month to generate additional value from Antam’s nickel products.
Deputy for Investment and Mining Coordination at the Coordinating Ministry for Maritime Affairs and Investment, Septian Hario Seto, said this was a strategy that would develop the nickel processing industry business into battery components for electric vehicles.
“This is a technology race. LG Chem and CATL are two pioneers in lithium battery technology,” he said as quoted by Bloomberg, Wednesday (14/10/2020).
A spokesman for the South Korean battery creator said LG Chem and Antam have agreed to look into future cooperation options. He said the full agreement would help provide LG Chem with stable access to nickel.
Previously, Indonesia announced that the investment needed to build an electric vehicle battery supply chain could potentially reach $30 billion. The investment plan from CATL and LG Chem is mentioned as part of this $30 billion investment plan.
Additional investment will offer further support for President Joko Widodo (Jokowi)’s ambition to develop the country as a major regional hub in the industry.
Companies including PT Indonesia Asahan Aluminum (Inalum) and PT Perusahaan Listrik Negara (PLN) will work together under parent company, Indonesia Battery. The business will produce lithium-ion cells and work with Antam and others.
At least one factory could start production before the end of next year, if environmental approval and waste management plans are completed.