U.S. carmaker Ford Motor Co signed a final investment agreement with PT Vale Indonesia, and China's Zhejiang Huayou Cobalt on Thursday to build nickel processing plant, valued at around $4.5 billion.
The high-pressure acid leaching (HPAL), located in Pomalaa, Southeast Sulawesi where Vale operates a nickel mine, is expected to produce 120,000 tonnes per annum of mixed hydroxide precipitate, material extracted from nickel ore that would be used in batteries for electric vehicles.
Indonesia, which has the biggest nickel reserve in the world, has been trying to develop downstream industries for the metal, with ambitions to eventually produce batteries and electric vehicles.
Vale and Huayou commenced construction of the plant in November.
Thursday's signing was a follow up to a non-binding memorandum of cooperation for the plant that the three companies had signed last year. At the time, they said the project was expected to be completed in 2025.
Indonesia's government has from 2020 banned export of unprocessed nickel ore to ensure supply for existing and potential investors.