Vale and Zhejiang Huayou Cobalt are joining forces to build a high-pressure acid leaching (HPAL) processing plant in the Indonesian province of Southeast Sulawesi with an aim to produce up to 120,000 tonnes of nickel per annum.
In this regard, Vale’s subsidiary Vale Indonesia and the Chinese mining firm have signed a framework cooperation agreement (FCA).
The HPAL processing plant is planned to be built in Pomalaa, Kolaka.
Vale president commissioner Deshnee Naidoo said: “This is a significant milestone that reflects our longstanding commitment to developing Indonesia’s world-class nickel resources.”
Under the FCA, Zhejiang Huayou will be responsible for constructing and implementing the Pomalaa project. Vale will hold the right to acquire up to a stake of 30% of the project.
Zhejiang Huayou’s HPAL process, technology, and configuration will be adopted and applied by the project. This will enable the processing of limonite ore and low grade saprolite ore from Vale’s mines in Pomalaa to produce mixed hydroxide precipitate (MHP) product.
Vale CEO and president director Febriany Eddy said: “We appreciate that our partner comes along with our low carbon agenda, not to use coal fired power plant. This FCA is evidence of alignment of our sustainability commitments which are extremely important for PT Vale.
“Huayou has proven track records in HPAL construction and operations in Indonesia. We are confident that the two parties can serve as good complement for each other.”
Vale said that the partners will work together for minimising the carbon footprint of the project. They have also agreed further not to use captive or dedicated coal-fired power plants for any power source for the purpose of the HPAL project.
The parties expect to sign definitive agreements within six months of the FCA.
The project’s construction has already begun with early works being carried out by Vale. It is expected to be completed within a period of three years.
In a separate development, Vale had signed a binding agreement earlier this month to sell its manganese and iron ore mines in Brazil for an enterprise value of $1.2bn.
