China’s largest battery producer Contemporary Amperex Technology (CATL) [300750:CH] signed an agreement with Indonesia’s state-owned PT Aneka Tambang (ANTAM) and PT Industri Baterai Indonesia (IBI) to jointly develop a USD5.97bn mining-to-batteries complex in Indonesia, as reported by Bloomberg on April 15. Specifically, the integrated project will cover nickel mining, battery materials, recycling, and an electric vehicle (EV) batteries factory. The agreement is of vital importance to Indonesia as the country seeks to build an EV ecosystem, according to Minister for Maritime Affairs and Investments, Luhut Binsar Pandjaitan.
Indonesia aims to become a major participant in the EV supply chain by leveraging the island country’s abundant reserves of nickel, a substantial material for EV battery cells. In March 2022, German automaker Volkswagen [VOW:GR] also formed a joint venture (JV) with China’s mining giants Huayou Cobalt [603799:CH] and Tsingshan Group to exploit nickel resources in Indonesia. As for CATL, it aims for a steady nickel supply, lowered manufacturing costs, and the development of battery recycling businesses through expansion in Indonesia. In March 2022, CATL’s battery plant in China’s Sichuan Province was certificated as the world’s first zero-carbon factory in the new energy industry by Swiss testing, inspection, and certification agency SGS. Moreover, the company plans to realize zero-carbon operation for all its ten manufacturing bases across the world.