Indonesian state-owned fund Danantara has partnered with GEM, the China-based green metallurgy and circular economy solutions firm, to develop a $1.42 billion high-pressure acid leaching (HPAL) smelter facility in Indonesia.
Danantara said in statement on last Wednesday that the duo have signed a head of agreement (HoA) for the facility.
The agreement establishes a framework for potential strategic co-investment in Indonesia’s fast-growing downstream sector, reflecting both parties’ commitment to advancing sustainable industrial development and capturing long-term value in the global energy transition.
The HoA establishes the framework for co-investment in the HPAL smelter facility with a planned capacity of 66,000 tons per annum of nickel in mixed hydroxide precipitate.
The project builds on the existing partnership between PT Vale Indonesia Tbk and GEM, with Danantara Indonesia now joining this collaboration alongside the potential involvement of other global partners.
Rosan Roeslani, Chief Executive Officer of Danantara Indonesia, stated that the partnership with GEM represents another milestone in Danantara Indonesia’s mission to catalyze strategic investments that accelerate Indonesia’s socioeconomic transformation.
“By joining forces with a global pioneer in green metallurgy, we are advancing the country’s downstream agenda while ensuring sustainability and innovation remain at the forefront,
“The integration of research & development, green energy, and closed-loop recycling reflects the kind of high-impact projects that will create long-term value for Indonesia and our investment partners,” he added.
It is noted that GEM has invested $30 million to jointly establish a state-of-the-art metallurgical research laboratory in collaboration with the Bandung Institute of Technology (ITB), pledging to reinforce Indonesia’s role as a hub for research and development. Within the next five years, the initiative at the Indonesia Green Industrial Park (IGIP) aim to create up to 80,000 new jobs, delivering broad-based economic benefits.
According to the statement, its long-term vision goes beyond nickel processing to encompass cathode materials, battery cells, high-quality nickel plate, and heavy equipment manufacturing.
Designed to run on green energy and anchored by a closed-loop recycling system, the project integrates sustainability at every stage of production while strengthening Indonesia’s long-term industrial competitiveness.
In Indonesia, GEM has made significant investments in nickel-based new energy materials, including the establishment of a high-tech nickel industrial park, a joint
innovation laboratory with Indonesian and Chinese top universities.
These initiatives reflect GEM’s vision of combining technology, culture, and sustainability, and further strengthen Indonesia’s position as a strategic hub for the global electric vehicle (EV) supply chain, said the statement.