Jakarta. The government dropped Thursday more hints about the planned smelter project involving European investors, saying that unnamed French and British businesses had shown interest in building such a facility in Indonesia.

The Foreign Affairs Ministry not long ago revealed that several European businesses were already serious about making a “quite huge investment” in Indonesia's nickel downstream sector. This includes building a smelter in the country. However, the ministry refused to reveal which part of Europe these interested investors came from. Nor did they unveil the potential location of the smelter. 

Nurul Ichwan, a deputy at the Investment Ministry, confirmed Thursday that negotiations related to a nickel project were in fact underway.

"Yes, it is true about the nickel smelter [investment plans]. Our ministry is in the process of facilitating this investment. It is not just a partnership between European businesses, but it will also have Indonesian partners as well,” Nurul told reporters in Cikarang.

But again, Nurul refused to disclose the names of the interested companies.

"But they come from France and the UK,” Nurul said while hinting that there might be more than two European firms that Indonesia was engaging the talks with.

Indonesia has the world's largest nickel reserves as its leverage. The country’s nickel reserves stand at a whopping 21 million metric tons, on par with Australia’s. And Jakarta has stopped exporting raw nickel ores. So if countries wish to exploit Indonesian nickel, they may build a refining facility in Indonesia. 

"Let's not forget that Indonesian businesses own over 80 percent of the nickel mining business licenses in the country. But the smelters in Indonesia are mostly owned by foreign businesses because we don't have the technology," Nurul said.

Indonesia’s abundance of nickel --which is a mainstay ingredient for electric vehicle (EV) battery manufacturing--has caught the attention of many European businesses, according to Nurul. 

“You all [reporters] are also aware of how interested Europe is in harnessing our nickel to produce EV batteries,” he said, while listing some of the already announced European investment plans such as French miner Eramet and German chemical producer BASF.

Earlier this year, Investment Minister Bahlil Lahadalia said that BASF would partner with Eramet on a $2.6 billion nickel-cobalt refinery in North Maluku. 

According to government data, the UK and France ranked the 11th and 12th largest foreign investors in Indonesia throughout the first nine months of 2023. British FDI totaled $290.4 million over the same period, while France invested approximately $244.7 million.

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