PT Vale Indonesia commenced construction of a nickel processing plant, or smelter, in Pomalaa, Kolaka, Southeast Sulawesi, in November 2022.
According to Luhut Pandjaitan, the Coordinating Minister for Maritime Affairs and Investment, once the project is completed, Indonesia will possess the world's largest nickel smelter.
"In Halmahera, there's (a nickel smelter with a capacity of) 20,000 tons, already exporting. In Morowali, 30,000 tons, and in Pomalaa, 120,000 tons. So we're the biggest in the world," said Luhut, as reported by *Katadata.co.id*, Monday (November 28, 2022).
Based on data from the Ministry of Energy and Mineral Resources (ESDM), Indonesia currently has 15 nickel smelters. There are also 2 bauxite smelters, 2 copper smelters, 1 iron ore smelter, and 1 manganese ore smelter.
"Currently, Indonesia has 21 smelters, and it is planned that 7 more smelters will be added this year," stated the Ministry of ESDM in its *Daily Strategic Information Review of Energy and Minerals*, Monday (November 28, 2022).
According to the Ministry of ESDM, Indonesia needs smelter development to enhance national self-reliance in the downstream sector or processing of raw mining materials.
"Downstreaming has good objectives, namely to provide added economic value to natural resources, create many jobs, and increase state revenue," said the Ministry of ESDM.
"Besides nickel, other mining commodities are also known to have a multiplier effect on the economy when undergoing downstream processing. For example, bauxite processed and refined into alumina will be worth 8 times more. Alumina upgraded into aluminum will be worth up to 30 times more compared to when it was still in the form of bauxite ore," it continued.
The Ministry of ESDM also stated that downstream processing will continue to be developed for commodities other than nickel, such as bauxite, copper, tin, and gold.
"The economic foundation, one of which is downstreaming, must continue to be strengthened so that Indonesia's competitiveness continues to increase," it concluded.