China's GEM eyes majority stake in $700M Indonesian nickel project – Reuters

Chinese battery company GEM Co. Ltd. signed a memorandum of understanding to double its stake in a $700 million battery-grade nickel project in Indonesia to 72%, Reuters reported Jan. 4.

In September 2018, GEM subsidiary Jingmen Gem Co. Ltd agreed to join a consortium that would construct the 50,000-tonne-per-year plant located in the Morowali Industrial Park. The project had been expected to start production by end-2020 but was delayed due to the coronavirus pandemic. A GEM representative told Reuters that the plant will start production at limited capacity in 2022.

Under the MOU, Jingmen will take over Tsingshan Holding Group Co. Ltd.'s 21% interest in the project. Reuters reported on the same day that Tsingshan and Xuzhou Construction Machinery Group Co. Ltd. agreed to spend 5.5 billion yuan on a project in Xuzhou city that will focus on the development and production of new energy vehicles, batteries and other auto parts.

Jingmen will also acquire a 15% stake held by Guangdong Brunp Recycling Technology Co. Ltd, a subsidiary of Contemporary Amperex Technology Co. Ltd., reducing its interest to 10% from 25%. Pt. Indonesia Morowali Industrial Park, a joint venture between Tsingshan and Indonesia PT Bintangdelapan Group, will retain a 10% stake and Hanwa Co. Ltd. will keep an 8% stake.

The deal's financial terms were not disclosed and it was unclear when it would be implemented, Reuters added.

Tsingshan and a spokesman for the Morowali Industrial Park declined the newswire's request for comment while Contemporary Amperex and Hanwa did not respond to calls seeking comment.

As of Jan. 1, US$1 was equivalent to 6.53 Chinese yuan.