Indonesia halts deep-sea mining disposal of nickel for environment concerns

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Indonesia will no longer permit mining waste to be disposed in the ocean to allay concerns about the environmental impact of processing nickel used in electric vehicle (EV) batteries, a government official and a corporate mining source said.

The Southeast Asian nation, the world’s biggest nickel producer, has not officially banned so-called deep sea tailings (DST) but by not issuing new permits it could delay planned projects and complicate efforts to dispose of waste.

Proponents of DST say it is cheaper and less harmful to pipe waste into the sea, especially on tropical islands where earthquakes or heavy rain limit storage, but critics says the impact of such marine disposal is poorly understood.

“There is no written regulation yet, but the policy is to not issue permits for deep sea tailing for any future projects,” Jodi Mahardi, a spokesman for the Maritime and Investment Affairs Coordinating Minister, told Reuters.

Up to now only one nickel mine in Papua New Guinea is using DST, according to global producer association the Nickel Institute. Indonesia currently uses the disposal method at its second-largest copper mine, run by PT Amman Mineral Nusa Tenggara.

Indonesian nickel projects seeking permission for DST did not receive an outright rejection, but a lengthy wait meant that land tailings eventually become “the only option”, according to a corporate mining source familiar with the matter.

Once the world’s biggest exporter of nickel, Indonesia banned ore exports last year amid efforts to develop a full nickel supply chain, starting from extraction, processing into metals and chemicals used in batteries, all the way to building EVs.

At least four high-pressure acid leach (HPAL) plants, which process nickel laterite into chemicals used in batteries, are being constructed in Indonesia led by Chinese investors. Most planned to dispose waste in the sea. Despite obstacles, Indonesia is expecting investment in nickel processing to double from 2020 to $35 billion by 2033, led by Chinese stainless steel producers and battery makers. The country also signed a $9.8 billion EV battery deal with South Korea’s LG Energy Solution in December.

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