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20 Feb 2024, 16:01 PM

Mineral Downstreaming Thrives: Indonesia Counts 187 Smelters by 2023 / PT. GNI
The Coordinating Ministry for Maritime and Investment Affairs (Kemenkomarves) reports on performance achievements in 2023, one of which is the development of the mineral processing industry, which has now reached 187 smelters.  The report was uploaded to the official Instagram account @kemenkomarves, quoted on Friday (16/2/2024). The smelter construction is a major project to boost the downstream policy.  Meanwhile, the government will continue downstream so that the processing or refining industry and mineral-based industrial estates will continue to develop in Indonesia."Through the downstream policy, significant investment growth has been achieved in the mineral processing industry (187 smelters), especially in the nickel industry with 111 smelters," stated the report.Moreover, the investment growth in the downstream sector has triggered the mineral-based industrial estate growth outside of Java. The condition is believed to encourage the Indonesian economy's development locally and nationally.Based on data from the Indonesia Investment Coordinating Board (BKPM), the investment realization in the downstream sector reached IDR 375.4 trillion throughout 2023. The downstream sector accounts for 26.5% of the total investment realization in 2023.The largest investment was recorded in the mineral sector at IDR 216.8 trillion, including nickel smelter construction at IDR 136.6 trillion, bauxite smelter at IDR 9.7 trillion, and copper smelter at IDR 70.5 trillion.Furthermore, the downstream investment in the agricultural sector reached IDR 50.8 trillion, forestry IDR 51.8 trillion, oil and gas IDR 46.3 trillion, and the electric vehicle ecosystem IDR 9.7 trillion.The information is not only about smelter construction. The Ministry has also completed several other major projects, such as the Jakarta-Bandung High-Speed Train (KCJB).  Another major project is the Aceh-Lampung Trans Sumatra Toll Road and the National Strategic Project for the prioritized infrastructure development of the Ibu Kota Nusantara (IKN).Image source: / PT. GNISource: 
20 Feb 2024, 14:40 PM

MIND ID Group Records Positive Growth in 2023

Pos Kota / Illustration
MIND ID, or Mining Industry Indonesia, experienced an operational performance improvement in 2023.MIND ID, as a State-owned Mining Industry Holding in Indonesia, has the mandate to manage mineral and coal resources in Indonesia together with its members, which include PT Antam Tbk, PT Bukit Asam, PT Freeport Indonesia, PT Inalum, and PT Timah Tbk,.PT Aneka Tambang Tbk (Antam), a member of the MIND ID Group, showed positive performance through the achievement of financial performance growth from January to September 2023 or 9M23. Antam recorded a profit of IDR 2.85 trillion in the 9M23 period.The company's profit grew by eight percent from the first nine months of 2022, which reached IDR 2.63 trillion. Meanwhile, Antam's Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) in 9M23 was IDR 5.40 trillion.EBITDA is the value of a company's income before deducting interest, taxes, depreciation, and amortization, which acts as an indicator to measure the profit or profit earned by the company. "Antam's EBITDA in 9M23 shows the consistency of the company's achievements when compared to EBITDA in 9M22," said MIND ID Corporate Secretary Heri Yusuf as quoted on Tuesday (21/2).The company's net cash flow from operating activities in 9M23 grew by 93 percent or IDR 3.98 trillion compared to the net cash flow in 9M22, which only grew at IDR 2.06 trillion.The balance of cash and cash equivalents in 9M23 reached IDR 7.54 trillion or grew 63 percent from the position at the end of the 9M22 period of IDR 4.62 trillion. In addition, Antam also managed to make net sales of IDR 30.90 trillion in 9M23, with the percentage of domestic net sales reaching 86 percent or equivalent to IDR 26.69 trillion.Antam also recorded a total gold production volume from the company's mines of 908 kg (29,193 troy oz.), with sales reaching 19,460 kg (625,652 troy oz.) in 9M23. This shows that Antam's gold production accounted for 62 percent of total sales of IDR 19.29 trillion. Image source: Pos Kota / IllustrationSource: 
20 Feb 2024, 14:31 PM

Coal Export Value Drops 30%, ICMA: Price Falls Drastically

ANTARA Foto / Andri Saputra
Statistics Indonesia (BPS) noted that coal exports in January 2024 fell by almost 30% on an annual basis to USD 2.41 million compared to USD 3.43 million in January 2023. In comparison with the previous month, or December 2023, exports fell 19.68%.The Executive Director of the Indonesian Coal Mining Association (ICMA), Hendra Sinadia, said the decline was due to the lower coal price in January 2024. "It is due to lower prices compared to the previous period," he told on Friday (16/2).Hendra added, however, that falling prices were not the main factor in suppressing exports. "Actually, it is more about the price, and usually, the production level and export volume are lower at the beginning of the year," he said.In line with Hendra, Acting Head of BPS Amalia Adininggar Widyasanti said that the decline in coal exports was due to a decline in volume and prices."There is a downward trend in coal prices in the global market. As the decline in value is deeper than the volume, the decline in coal exports monthly is mainly due to the decline in prices," Amalia said at a press conference in Jakarta on Thursday (15/2).Based on the countries, the biggest decline in coal exports to China fell to 25.08% and India to 17.11%. "The value of coal exports contributes 12.59% of the total exports in January 2024," he said.For the record, coal prices have indeed experienced a significant decline throughout 2023. In January 2023, Indonesia's coal price benchmark (HBA) was still at USD 305.21 per ton, and the price of Newcastle coal, Australia, one of the global benchmark prices, was in the range of USD 350-390 per ton.However, in January 2024, the benchmark had dropped to below USD 130 per ton, while the price of Newcastle coal was below USD 130 per ton, even touching USD 115 per ton on January 29. This implies that prices have fallen by more than 50% in the past year. Image source: ANTARA Foto / Andri SaputraSource: 
20 Feb 2024, 14:09 PM

Indonesian Mining Needs More Heavy Equipment Vehicles
The Heavy Equipment Manufacturer Association Of Indonesia (Hinabi) in 2023 noted that heavy equipment production in Indonesia reached 8,066 units.The most heavy equipment was produced in 2022, with 8,826 units in total. Thus, the production rate decreased by 8.61 percent on an annual basis (year on year).Quoted from Antara news agency, the Ministry of Energy and Mineral Resources (ESDM) said that the mineral and coal subsector in 2023 contributed to non-tax state revenue of IDR 173 trillion or 58 percent of the total national non-tax state revenue (PNBP).Seeing the decline in heavy equipment production and non-tax revenue contribution, the Minister of Industry Agus Gumiwang Kartasasmita asked the Indonesian automotive industry to produce mining trucks that fit the mining conditions in the country.The Minister of Industry said industry players can start this by making assembly details that have specifications appropriate to mining conditions in Indonesia."We encourage the domestic industry to immediately prepare truck products that meet mining specifications. We ask them to at least make an assembly line first," explained the Minister of Industry after the P3DN Award Kick-Off event in Jakarta on Monday (12/2/2024).According to him, the reason for encouraging the production of mining trucks that have qualified specifications is that this sector continues to see growth every year.He assessed that the need for natural resources derived from mining is quite large, so the tools used must be suitable and also domestically made.By carrying out the assembly beforehand, the mining sector can also contribute to the value of the domestic component level."There is a domestic component value since the needs are very large. While coal is growing, other commodities in minerals are also growing. We have to make sure that our industry is ready," said the Minister of Industry.Image source: Suara.comSource: 
20 Feb 2024, 13:54 PM

Minister of Industry Requires Industry to Produce Mining Vehicles That Suit Local Conditions

ANTARA / Muzdaffar Fauzan
The Minister of Industry, Agus Gumiwang Kartasasmita, called on Indonesia's automotive industry to produce mining trucks that are suitable for mining conditions in the country.The Minister pointed out that industry players can start this by making assembly details that have specifications suitable for mining conditions in Indonesia."We encourage the domestic industry to immediately prepare trucks that are suitable for mining specifications. We urge them to at least make an assembly line first," the Minister of Industry said after the P3DN Award Kick-Off 2024 event in Jakarta on Monday.The reason the Ministry is encouraging the production of mining trucks that have qualified specifications is that the sector continues to grow every year.He assessed that the demand for natural resources from mining is quite large, so the tools used must be suitable and domestically made.By making the assembly in advance, the mining sector can also contribute quite highly to the value of the domestic component level."There is a domestic component value, as the needs reported are very large. As coal grows, other commodities in minerals also grow. At the same time, I agree that our industry must be ready," he said.Meanwhile, based on data from the Indonesian Heavy Equipment Association (Hinabi) in 2023, it was noted that heavy equipment production in Indonesia reached 8,066 units.Meanwhile, the highest number of heavy equipment was produced in 2022, with 8,826 units. Therefore, on an annual basis (year on year), heavy equipment production decreased by 8.61 percent.The Ministry of Energy and Mineral Resources (MEMR) said that the mineral and coal subsector in 2023 contributed to non-tax state revenue of IDR 173 trillion or 58 percent of the total national non-tax state revenue.Image source: ANTARA / Muzdaffar FauzanSource: 
20 Feb 2024, 12:38 PM

Inalum Aims to Operate Mempawah Alumina Smelter by the End of 2024

CNN Indonesia / Inalum
PT Indonesia Asahan Aluminum (Inalum) is optimistic that the National Strategic Project of Smelter Grade Alumina Refinery (SGAR) Mempawah will operate by the end of 2024.The Mempawah smelter became one of the National Strategic Projects in December 2023 as it is expected to help achieve the bauxite-aluminium downstream policy initiated by President Joko Widodo (Jokowi).Inalum Corporate Secretary Mahyaruddin Ende hopes that everything goes according to plan and continues to get support from all stakeholders."As a state-owned entity that is part of the Indonesian Mining Industry Holding, Inalum is optimistic that SGAR Mempawah can operate between the second semester of 2024 and 2025," Mahyaruddin said in a written statement on Thursday (15/2)The Smelter Grade Alumina Refinery in Mempawah is a strategic project run collaboratively by Inalum and PT Antam Tbk through a subsidiary, PT Borneo Alumina Indonesia (BAI).The construction of the Mempawah Smelter has reached over 80 percent and is scheduled to be completed in 2024.The Mempawah smelter project will connect the supply chain between bauxite ore minerals (West Kalimantan) and aluminum smelting plants (Inalum). Once in operation, the project expects to produce 1 million tons of alumina per year (raw material 3.3 million tons of bauxite per year)."It is planned to start production in 2024 and reach full production capacity in 2025," he explained.The Mempawah smelter project is divided into phases I and II, with an estimated investment value of around USD 1.7 billion or IDR 26.52 trillion (assuming an exchange rate of IDR 15,600 per US dollar). Image source: CNN Indonesia / InalumSource: 
20 Feb 2024, 12:00 PM

MIND ID Group's Reclamation Program Implements Good Mining Governance

The State-owned Mining Industry Holding Company comprises PT Aneka Tambang Tbk, PT Bukit Asam Tbk, PT Freeport Indonesia, PT Inalum, and PT Timah Tbk. MIND ID Group is a natural resource management company aware of the landscape changes in mining and mineral processing activities.Reclamations and biodiversity are, therefore, key material aspects of MIND ID Group's concerns. Precautionary principles are applied in every activity to minimize operational impacts.According to MIND ID Corporate Secretary Heri Yusuf, MIND ID's reclamation is a form of commitment to implementing good corporate governance and operational practices. "The reclamation is part of the MIND ID Group's mining operational cycle and will continue throughout the operational activities," he said. MIND ID conducts reclamation as part of the implementation of the company's sustainability concept.  Reclamation is a concrete step taken by MIND ID Group in applying Environmental, Social, and Governance (ESG).Heri explained the reclamation that MIND ID Group carried out has been going on since long ago. PT Timah Tbk, a member of the MIND ID Group, has consistently carried out some reclamation programs on land and sea."PT Timah carried out a marine reclamation program in 2023, such as artificial reef submergence, installation of abrasion barriers, and mangrove crab restocking," said Heri.The reclamation programs were done in Bangka Belitung Islands Province and Riau Islands Province. PT Timah synergizes with the community living around the company's operational areas in the reclamation program.PT Timah has successfully sunk around 1,920 artificial reef units in the waters of Bangka Regency, Central Bangka Regency, West Bangka Regency, and South Bangka Regency. The marine reclamation activities that have been implemented since 2016 are the company's efforts to maintain marine and coastal ecosystems. "The artificial reef can change the topography of the seabed and the flow of currents that carry food nutrients for fish, which in turn becomes a home for fish to breed," he said.In addition, the reclamation program aims to support the development of underwater tourism in Bangka Belitung Islands Province.Meanwhile, the reclamation in Riau Islands Province includes 1,000 mangrove crabs restocking and building a 200-meter-long abrasion barrier. The abrasion barrier is part of the company's efforts to maintain coastal ecosystems and prevent abrasion.Amran, one of the fishermen of Sawang Laut Village, admitted that he was very happy with the mangrove crab restocking program organized by PT Timah Tbk, a member of the MIND ID Group. He said it was directly beneficial for the fishing community and the environment."I strongly support these activities because we, the fishermen, will also feel the results with the presence of many crabs, of course, our income will also increase," he said.Another reclamation effort by MIND ID Group member PT Freeport Indonesia (PTFI) is planting and reforesting the former Grasberg open pit mine area. As of 2023, PTFI has planted 35 hectares of land in the former Grasberg excavation, precisely in the Wanagon area - west of the Cartenz peak at 3,800 meters above sea level - and in the Kaimana area - west of 4,300 meters above sea level."PTFI is targeting to revegetate and land stewardship in the former mining area of 65 hectares by 2024. The total land area to be reclaimed until operational closure in 2041 is 900 hectares," said Heri. Up until 2023, PTFI has reclaimed 507 hectares of ex-mining land. PTFI's reclamation process initially involved land sloping. This was to cover the former mining excavation using limestone or limestone as thick as 5 meters.This closure also serves as an effort to prevent water seepage. The slope of each stretch is also adjusted to a slope level of about 25 degrees.As for revegetation activities, PTFI uses local native plants, namely Deschampsia endemic grass that only grows in the Grasberg area. PTFI also has a nursery house to cultivate Deschampsia endemic grass seedlings.Approximately 10,000 Deschampsia grasses can grow on an area of 1 hectare. PTFI also conducts hydroseeding or fertilization with a sow and spray system. "MIND ID Group's reclamation efforts show the company's commitment to safe and sustainable production activities," Heri said. Image source: KONTAN / Doc. MIND IDSource:
20 Feb 2024, 10:57 AM

Minister of Energy and Mineral Resources: MIND ID and Vale Agree on Divestment Value

KONTAN / Arfyana Rahayu
PT Mineral Industri Indonesia (MIND ID) and PT Vale Indonesia Tbk (INCO) have reached an agreement for the divestment of 14% of their shares. Minister of Energy and Mineral Resources (ESDM) Arifin Tasrif revealed that the price for the transaction of 14% of the shares to be divested has been agreed upon. The agreed value is said to be around IDR 3,000 per share. "(The deal) has been done. Hopefully, in a few days, we will just need the administration," Arifin explained at the Directorate General of Oil and Gas Office of the Ministry of Energy and Mineral Resources, on Friday (16/2).Arifin continued, that the agreement is expected to be finalized in the coming days. In addition, the government will get a discount for this transaction through MIND ID. "(Vale's current share price) is below that. A little over IDR 3,000.  We are waiting for the official announcement," Arifin continued. Minister of State-Owned Enterprises (BUMN) Erick Thohir revealed the progress of the divestment of PT Vale Indonesia Tbk (INCO) shares. Erick said that there was already a breakthrough in the negotiation process. The government, through the state-owned mining holding company MIND ID, managed to agree on the price of the shares to be purchased from Vale. "Vale has agreed, but we will announce it later with an official signing," Erick explained to the media crew after the BUMN Gen event at PIM 3, Jakarta, Tuesday evening (13/2).However, Erick did not want to disclose the exact figure the government had obtained. He emphasized that there has been a price comparison process to find the best offer or price comparison in acquiring Vale. "What is certain is that back when I negotiated with Vale, there had to be a price comprising discount. Otherwise, they will relinquish or disinvest," Erick explained. Image source: KONTAN / Arfyana RahayuSource: 
13 Feb 2024, 09:00 AM

BRMS Gold Production Potentially Boost 2024 Revenue

Bisnis / Bloomberg - Stefan Wermuth
PT Bumi Resources Minerals Tbk (BRMS), has increased its gold production target for 2024. Analysts said the increase in production and the average selling price of gold above USD 2,000 per troy ounce will boost BRMS' revenue in 2024.  BRI Danareksa Sekuritas analyst Hasan Barakwan said BRMS' gold production target, which rose 40% in 2024, will increase BRMS' revenue. It is in line with the increase in gold prices above USD 2,000 per troy ounce compared to 2023, which reached USD 1,943 per troy ounce."We expect the increase in gold production along with the increase in the current gold price of USD 2,037 compared to the 2023 average of USD 1,943 per troy ounce will increase BRMS' revenue," Hasan said, quoted on Sunday (11/1/2024).  Furthermore, Hasan explained that the production will also be supported by an increase in the production rate of the second mill in 2024 to 3,000-4,000 tons per day. In addition, BRMS discovered additional mineral resources and reserves in Block 1 Poboya in Palu, Central Sulawesi. The additional resources came from the River Reef prospect, Hill Reef 1 prospect, and a new prospect at Watuputih, which is in the west of River Reef. These discoveries increased CPM's total mineral resources by 50% to 42.7 million tons from 28.4 million tons, with an average gold grade of 2.6 grams per ton.  Total mineral reserves managed by CPM also increased by 38% to 31.5 million tons from 22.8 million tons produced, with an average gold grade of 2.4 grams per ton.In the previous news, BRMS Director Herwin Hidayat targeted gold production in 2024 to exceed 35,000 troy ounces, exceeding the 2023 production projection of 25,000 troy ounces.  "We hope that gold production can exceed 35,000 oz during 2024," Herwin told Bisnis on Monday (5/2/2024).Herwin also expressed optimism that BRMS' ASP gold price will remain above USD 2,000 per troy ounce throughout 2024, given the continuous upward trend in gold prices. Meanwhile, for 2023, BRMS projects gold production of around 20,000 to 25,000 troy ounces. This marks a significant increase of 270% to 362% from the total production in 2022, which reached 5,400 troy ounces. Previously, Herwin had indicated the possibility of gold prices reaching or even exceeding USD 2,000 per troy ounce throughout 2024. This belief is based on an evaluation of geopolitical conditions as well as potential interest rate cuts by The Fed.Image source: Bisnis / Bloomberg - Stefan WermuthSource: 
13 Feb 2024, 08:00 AM

Vale Indonesia (INCO) Matte Nickel Production Increases 18% Throughout 2023

Antara Foto / Jojon
PT Vale Indonesia Tbk (INCO) reported an increase in operational performance throughout 2023. INCO produced 70,728 metric tons of nickel in matte in 2023. The production increased by 18% from 2022's production of 60,090 tons of nickel matte."Despite facing various challenges throughout the year, we managed to exceed our production target for 2023," explained Febriany Eddy, CEO and President Director of Vale Indonesia in information disclosure on the Indonesia Stock Exchange (IDX), Sunday (11/12).The production in the fourth quarter of 2023 reached 19,084 tons of nickel in matte. This amount was 6% higher than the production volume recorded in the third quarter of 2023 which amounted to 17,953 tons of nickel matte. The realization was also up 18% year-on-year (YoY) at 16,183 tons in the fourth quarter of 2022.According to Febriany, the production increase was the outcome of an effective maintenance strategy and improved performance at the mine area and processing plant throughout 2023. This led to higher production quarterly.INCO estimates nickel matte production this year at 70,000 tons. This figure is unchanged from last year's production estimate.Bernardus Irmanto, Chief Financial Officer of Vale Indonesia, said that there are two factors why production tends to be similar. First, the maintenance level of mining equipment, in which the number of days used for equipment maintenance will increase this year. This condition will affect the equipment availability for mining production.Second, the levels of production also consider the nickel grade in the mining area affecting the output. "[If normalized,] we have the chance to produce more. But given these two factors, the feasible production level is at 70,000 tons," explained Irmanto.Irmanto claimed that INCO is striving to maintain its equipment optimally to increase the utilization rate of its equipment, which will lead to higher production in the coming year. INCO also strives to obtain better nickel ore grades for better production output.Mirae Asset Sekuritas Indonesia analyst Rizkia Darmawan gives a buy trading recommendation on INCO shares with a price target of IDR 4,900 per share. Such a target price implies an 11.7 times price-to-earnings (P/E) ratio for 2024.Rizkia sees INCO's upside potential to be limited in the short term until the completion of its smelter projects in 2026. However, Rizkia is positive about the development of INCO's projects, which will meet the needs of Indonesia's downstream nickel industry and will support the electric vehicle (EV) supply chain.Mirae Asset Sekuritas estimates nickel prices will remain high, although they will not rise higher. According to the firm, Indonesia has a large supply of grade II nickel, and global economic activity is still slow, mainly in China.The average selling price (ASP) historically reflects around 75% of the London Metal Exchange (LME) benchmark price. Therefore, Mirae Asset assumes that INCO's ASP will be around USD 13,850 per ton this year.However, risks are looming over this recommendation, including delays in project implementation, further nickel price declines coupled with rising fuel and energy prices, and changes in government regulations.Image source: Antara Foto / JojonSource: 


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