A Snapshot of Sustainable Mining in Indonesia. Vol 132
On the 2nd and 3rd of November, 2021, the webinar “Moving towards sustainable development” was undertaken with a variety of sponsors, supported by several industry associations and media partners, including Petromindo.com. The two-day webinar was held in English with around 150 logged in participants. Ben Lawson (Vice-Chairman of Djakarta Mining Club & Coal Club Indonesia) undertook the moderator’s role and kept the webinar to a tight schedule.
Ellie Wang (Senior analyst – base metals, CRU) delivered a first-rate presentation with clear slides. The price of nickel is undergoing a strong rebound, with strong demand and concerns about nickel supply. Stainless steel is also experiencing strong recovery despite China stainless steel production cuts. Much of the growth in consumption of stainless-steel is driven by household appliances and such. Tracking of London Metal Market trends suggests that as prices rise, stockpiles of commodities are dropping. As nickel and coal prices rise, some China smelters are approaching production break even cash costs. China imports of nickel ore from the Philippines (typical grade 1.3%) is becoming less attractive, and compounded by wet season supply difficulties. Some power supply limitations in China is also having constraints on Nickel Pig Iron (NPI) production. However Indonesian nickel producers are continuing to construct more nickel smelters, wherein Indonesian nickel products are supplying a growing share of world increase in demand. Indonesian nickel smelters have continued to perform reasonably well, despite some difficulties of Covid limitations on foreign engineers, slow-down of supply of metallurgical and thermal coal, and the seasonal rains.
Webinar discussion touched on speculation of the Indonesian government placing restrictions on low nickel content metals exports, and speculation of various possible China import taxes on nickel metal products. Most Indonesian smelters import metallurgical coal or coke from China or Russia, and it seems there is no immediate intention to import more Australian coal.
Brian Letigio (Chief customer solutions ADEN group) presented on “Improving workplace environment and quality through facility management”. This clean presentation was largely about introducing the ADEN company that provides a range of services including camp sites, work force support systems, communication and community development.
Webinar discussion emphasized ADEN’s experience in dealing with remote mining communities, and in-particular, in overcoming resistance to adopt changes to new technologies etc.
Chandra (Senior VP project management IBC PT. Industri Bateral Indonesia, who spoke on “Indonesian Battery Corporation – Plan to develop EV battery industry”. Various figures show ambitious growth in battery demand. It is clear that power to recharge batteries will come from mixed sources. Indonesia is encouraged to promote EV motorbikes. There are many principal EV battery manufactures, each with their own mix of metals and performance factors. The Indonesian government has recently set up a new SOE entity called the Indonesia Battery Corporation (IBC), with equal 25% shareholders from Antam, MIND-ID, Pertamina and PLN. This entity shall have a vertical integrated development of the EV battery industry, from mining & refining metal, making batteries, distribution, charging stations and recycling etc. Partners and investors are sought to contribute towards the envisage capex of USD 15.3 billion. The operation of precursor cathode and cell plants is envisaged for 2025.
Web discussion confirmed that one of the reasons in setting up IBC is so that industry can deal with one SOE with cross ministerial links, rather than 4 separate SOE’s and separate ministries. Industry discussions of a possible minimum nickel content requirement for export, or tax is largely being addressed by IBC SOE partners, as they have a direct interest in such projects.
Tony Gultom (Director PT. Halmahera Persada Lygend [HPL]) presented on “Hydrometallurgy project in Obi Island”. Tony provided a number of maps and slides on Indonesian nickel reserves.
| Material | Ni Grade | Resources (Ton ore) | Reserves (Ton ore) | |||
| Inferred | Indicated | Measured | Probable | Proven | ||
| Limonite | <1.5% | 2,979,633,284 | 2,395,531,402 | 1,408,472,213 | 1,634,875,414 | 223,972,671 |
| Saprolite | >1.5% | 1,821,973,858 | 1,471,009,416 | 1,116,465.504 | 1,823,828,808 | 808,321,131 |
| Undefined | 177,028,742 | 133,699,214 | 60,793,095 | 50,561,850 | 53,031,220 | |
| Total | 4,978,635,844 | 4,000,240,032 | 2,585,730,812 | 3,509,266,069 | 1,085,325,022 |
Source Minerba ESDM, July 2020.
Obi nickel mining is a National Strategic Project (PSN) located in South Halmahera Regency in Eastern Indonesia. The mining is carried out in the concessions of PT. Trimegah Bangun Persada and PT. Gani Permai Sentosa. Initial production of ferronickel started in 2016, followed by construction of HPAL and RKEF plants. The mining of both limonite and saprolite is made complex due to the nature of the ore. PT. Megah Surya Pertiwi [MSP] processes high grade nickel (saprolite) with pyrometallurgy of the Rotary Kiln Electric Furnace (RKEF). PT. Halmahera Persada Lygend [HPL] processes low grade nickel (limonite) with hydrometallurgy of High Pressure Acid Leach (HPAL).
| Capex USD mill | Power MW | Line | Feed WMT/y | Product MT/y | Manpower | |
| MSP – RKEF | 361 | 170 | 4 | 2,400,000 | 240,000 | 2,340 |
| HPL- HPAL | 1,024.7 | 2 x 30 | 3 | 7,600,000 | 365,000 | 1,900 |
Web discussion included the urging of government to encourage the downstream industries to develop nickel metals into finished products. The problem of managing the smelter waste product requires further support from the government. The issue of reducing the carbon footprint of the mining and smelters is being studied. Coal sourced power is clearly straight forward and cheap, though in time other sources of energy may become more suitable. Preferred tailing management involves dry stacking and backfill of mined out areas to reduce land disruption. Feed for sulphuric acid will initially be imported.
Shane Boak (Business manager & general manager sales for Hexagon Mining) delivered a logical presentation on “Power of One”. Shane outlined the nature of Hexagon mining as a global leader in digital reality solutions, particularly as the mining industry develops towards greater automation. Each mine is unique, with many tools to support autonomous solutions that yield incremental gains in the various parts of exploration – mining industry.
Freddy Tamara (Act GM PT. Tekenomiks Indonesia) presented “A case study of using inorganic Fullerene-like Tungsten disulphide Nanoparticle [IFWS2]”. NIS Nanotech Industrial Solutions is a long-established company in Indonesia specializing on wear characteristics related to the oil industry. The presentation outlines the scientific studies relating to the use of molybdum or tungsten nanoparticles to reduce machine wear. The benefits of such oils include the potential to extend the time between oil changes resulting in more operational time and less oil usage.
Afdi Rahmandita (Mining consultant RPM Global) presented on “Demand chain optimization”. Many feasibility studies and mine production are tailored to producing one or two products to deliver to all customers. However, Demand chain optimization is designed to start with the coal specifications for the next arriving ship, and to direct the mining, stockpiling and coal transport accordingly. Furthermore, coal grade characteristics can be monitored during the loading process, where final blending can be undertaken to meet sales specifications. Thus on-ship blending may allow for some out-of-spec material (grade excursions) to be loaded while keeping to the overall supply specs, thereby optimizing coal reserves.
Sugeng Mujiyanto (Director of mining business development, Directorate general of mineral and coal, ESDM) spoke without slides on “The Government policy for accelerating downstream projects on mining and metal mining”. Sugeng outlined a number of mining laws and regulations that are seen to support the ongoing mining industry and national development. Synergy between the various government entities and the industry is encouraged. Internal government discussions are ongoing to possibly increase the number of smelters classified as National Strategic Development projects, and accelerate the licencing process. Smelter projects are encouraged to “find the right partners”. Concern for the increase in smelter products as feed for the growth of the domestic manufacturing industry. Must manage ore reserves to support national development. The government is now focussing on immediate smelting goals.
Discussion includes; –
- The ESDM recognizes that some ore deposits are not suited to provide justification to build smelters, such as complex base metal ores, and may regulate on these issues later.
- The flipside of the post 2009 mining policies is that greenfields exploration has largely stopped. It is essential that greenfield exploration be promoted to bring sustainability to the exploration, mining, smelting and manufacturing industries in Indonesia. The ESDM wants to promote greenfields and brownfields exploration, and has a number of projects ready for the bidding process, but is waiting to confirm legal certainty. It is likely some areas will be released next year (2022).
Saribua Siahaan (Director of regional promotion facilitation Indonesian investment coordinating board [BKPM]) presented “Development of EV ecosystems in Indonesia”. The omnibus law encourages foreign investment and supports mining through streamlining administration, options on land clearance, less overlapping regulations etc. This law supports the development of the Electric Vehicle (EV) battery industry. Discussion included the BKPM open to discuss development, including supporting smelter development in industrial estates with the supply of power, water, gas etc. The BKPM will endeavour to provide further support in permitting coal fired power plants for smelter and their support operations.
Orestes Trifilo (chief operating officer Altilium group) presented on “The DNi process – Optimising nickel process technology”. After a short introduction to the Indonesian nickel mining industry, Orestes introduced the new DNi nickel leach extraction process. Feed ore includes both limonite and saprolite, that is leached at one atmosphere using nitric acid at 110 deg C. Some 30 – 80 kg of nitric acid per ton of processed ore is consumed, with over 99% of the acid is reused. The main products are mixed (Ni – Co) hydroxide product, with co-products of hematite, magnesia, aluminium hydroxide, manganese, scandium. The process generates around 200kg of residue from every 1,000kg of ore processed. The residue is inert and mainly consists of silicates and can be dry stacked and returned to the mine. This process is in the development stage, with a Feasibility Study plant being developed in Queensland.
Fabio Paris (Regional sales manager for SE Asia Diemme filtration – a brand of the Aqseptence group) presented on “ Tailings management – gold and nickel tailings dry stacking solutions with pressure filtration case studies in Indonesia and New Caledonia”. The dry cake targeted undrained strength of >30 kPa is desired for geotechnical stability of dry stacking. This is best achieved through pressurized filtration. The filter of tailings produces a dewatered cake of more than 800 Pa for fully sheared yield stress. The New Caledonia nickel tailings project has a feed rate of 25,000 ton/day equipped with 10 X GHT2500F filter press. Environmental regulations do not permit the expansion of the existing wet tailings pond, wherein these tailings are being filter pressed and dry stacked in reclaimed tailing pond areas. This program will allow the mine to significantly extends it life. The Indonesian Martabe gold mine has a feed rate of 470 tph with dewatering of tailings to install 2 X GTH2500 to produce cake moisture at 14%. There is an extensive > 6-month program of testing the ores, tailings, including susceptibility to rehydrate, erode and geotechnical stability etc. A pilot unit is to be developed, and shall stay in Indonesia. The filter press is imported from Italy, though ancillary tanks etc are likely to be built locally.
Romy Ramadhani (VP PT. Hydrotech Metal Indonesia) presented “The current development of nickel processing (Smelter) in Indonesia – Where are the next investment opportunities?”. Following an introduction to the Indonesian and global nickel industry, Romy warned that if nickel production is outstripped by demand, then competitive nickel substitutes may evolve. The new Step Temperature Acid Leach process of STAL Technology was introduced to compete with RKEF and HPAL processes. STAL technology was developed in Indonesia and patented in 2020. Public listing on the Canadian stock exchange is scheduled for November 2021. Step Temperature Acid Leach (STAL) is to receive feed from both limonite and saprolite with one line capacity at 600 dmt ore/day, treated with sulphuric acid at a temperature of 300 – 700deg C at a pressure of 101.3 kPa (1 atmosphere), with 2.1 MWh electricity to produce MHP, MgSO4 and other by-products. STAL claim this technology produces the lowest carbon emissions [17 – 22 kg CO2/kg Ni] compared to RKEF and HPAL. The STAL technology may be suitable for the more than 300 small nickel IUP’s in Indonesia. STAL technology has module lay out for 1,800-ton Ni/annum that is estimated to require 9 months for commissioning and 12 months ramp up to full production, with a comparatively low capex of around USD 20k per ton capacity. Discussion implied this technology is not yet installed in Indonesia or elsewhere.
Prihadi Santoso (Chairman of the Indonesian smelter enterprises association [AP3I]) presented on “Protection of Indonesia’s strategic mineral supply chain”. The government and defence department are considering options for the security of Indonesia’s mineral industry. The National Geological Council is under the coordinating ministry of maritime affairs and investment, and consists of 6 ministries; – Energy & mineral resources, Environment & forestry, Industry, Trade, Finance and Investment / BKPM. Duties include to: 1) Male a road map of short- & long-term planning for the mineral sector to ensure the development of Indonesia. 2) Develop policies and regulations including the downstream development of the 6 strategic minerals of nickel, copper, gold, silver, cobalt, aluminium, tin and rare earths, that will include financing and the development of special economic zones etc.
Discussion identified the inter-rivalry between many of the ministries, wherein greater harmony is sought by combining the ministries of ESDM and Industry both into Commission 7. The President has emphasized to the ministry of finance / BKPM and other ministries to reach set development targets by 2023. This includes the proposals on smelter program export allocations to be set in the next 2 years. Discussion recognized the need to expand government incentives and finance options (BI) to stimulate the exploration, mining and smelting industries. It is recognized that some ores are simply not viable (complex minerology, or reserves too small) for building a specialized smelter, wherein this option should be resolved in the next 2 years to bring further benefit to the people of Indonesia.
Daniel Madre (Managing director PT. Danmar Explorindo) presented on “Indonesian underground mining for coal and minerals”. Indonesia has a long (130 year) recorded history of underground mining. There are several current modern large underground mineral mines. A number of gold and coal mines are now looking at the transition from open pit to underground. The potential for underground coal mining could extend the coal industry for many decades. Preferred underground coal conditions of seam thickness, structure and coal quality favours older geological age deposits in Kalimantan and parts of Sumatra. Drilling and underground development work is being undertaken to develop a number of gold, copper and base metal deposits. Underground mining will ensure the ongoing extraction of vital natural resources with less impact ion the environment, greater efficiency and potential lower costs. The skilled manpower to drive a future of underground mining is being developed.
James Newton- Thomas (Head of research and development, Jacon equipment) presented on “Towards shotcrete automation”. Underground mine openings are traditionally spray coated with a concrete like substance to provide additional geotechnical protection against scaling and water etc, plus make smoother walled work ways for air flow and equipment etc. James explained the automation development process through the steps of 1) inception, 2) adaptive, 3) assistive, 4) displacive, with numerous great images. Full automation can now largely replace the underground dangerous working conditions with robots, with greater QA/QC controls.
Sasha Kmeta (TruScan product manager – principal geologist Boart Longyear). Boart Longyear now provides drilling, drill products and geological data services. TruScan is a field deployed fully automated XRF geochemistry and imaging core scanning system, that includes matrix matched calibrations for superior accuracy for more elements. This system can work on core and cuttings, and can deliver most results in about half a day. The scan is useful for recording structure from core, indicative mineral content, drill & logging optimization and metallurgy characterizations.
Discussion indicated the TruScan is typically not suitable for JORC / KCMI ore estimations, though it can be a good check on low quality assay laboratories. One unit is on stand by in Jakarta, and typically is run by one geologist. Indicative costs are in the order of $15- 25 per meter scanned. Throughput can be 100m core or 360 – 410 chip samples per day.
Stefano Pramono (Project manager, Modular mining Indonesia) presented the first part of “Digitization projects in PT. Kaltim Prima Coal – drill & blast”. The ProVision Drill Project is applied to 10 blast hole drill machines to increase the accuracy and compliance to drill plan for location and down hole performance.
Untung Pramana (Superintendent – Technical drill & blast PT. Kaltim Prima Coal) presented the second part of “Digitization projects in PT. Kaltim Prima Coal – drill & blast”. The Excellent Blast Charging Project links digitization of the mobile mixing unit to improve operational productive & efficiency. This allows for rapid adjustment of the explosive charging quality, according to the rock hardness from drilling torque penetration rate data.
Justin Lim (General manager Sharpmapping) presented “IoT sensors – an implementation of monitoring sump dewatering”. Traditional monitoring of sump dams involving rain gauge, water level and outflow rate are now automated with high quality GPS and communication tools for remote monitoring on-site conditions that can allow faster response times. Other environmental sensors are available, along with a separate drone mounted sensors to measure the sump bottom profile. Future improvements are working on turning pumps on & off remotely. The weather and sump water data, and some pump technical data can be updated every 10 minutes or so. Discussion suggested typical industry mine pumping costs are around 8c/t water for a stage 1 pump & 14ct for 2 stage pumping. Pumping costs relate to pump height, multi stage pumping etc.
Conclusion. This webinar follows the growing trend to provide a platform for updates on the mining industry.The strong industry support, plus the diversity and depth of topics is a reflection on the success of this webinar and transparency of the industry.