Chinese electric vehicle battery firm GEM Co Ltd said on Monday it aims to double its stake in an Indonesian nickel project, becoming the majority investor to strengthen “strategic control” of the resources amid a nickel shortage.
Under a framework memorandum of understanding (MoU), GEM said in a statement, the firm’s Jingmen unit has agreed with partners in the project at Indonesia’s Morowali Industrial Park to increase its holding to 72% from 36%.
Financial terms of the MoU, which has yet to be finalised, weren’t disclosed. It wasn’t clear when the MoU might be implemented.
The plant, designed to produce chemicals used in batteries for electric vehicles with annual capacity at 50,000 tonnes, was expected to start production by end-2020, but was delayed due to the coronavirus pandemic.
An official at GEM’s investor relations office said part of the capacity will start production in 2022.
GEM had planned the project together with stainless and nickel maker Tsingshan Group, a unit of Contemporary Amperex Technology Ltd (CATL), Japanese trading house Hanwa Co Ltd and PT. Indonesia Morowali Industrial Park (IMIP) in 2018.
Alongside GEM unit Jingmen’s current 36% stake, the CATL unit holds 25%, Tsingshan has 21% and the remaining shares are held by IMIP and Hanwa.
Under the MoU, Jingmen will increase its stake in units of CATL and Tsingshan by 60% and 100% respectively, lifting its overall ownership of the Indonesia project to 72%. IMIP and Hanwa’s stakes will be directly affected by the deal.
