The divestment is a key condition for PTVI’s permit extension.

MIND ID, Indonesia’s mining industry holding company, agreed to acquire an additional 14% share of PT Vale Indonesia (PTVI) from Vale Canada and Japan’s Sumitomo Metal Mining (SMM) worth US$268M. The share sale and purchase agreement for the divestment is a continuation of the Heads of Agreement signed on 17 November 2023.

The divestment means that MIND ID will become the main shareholder of the integrated nickel matte production facility located in Sorowako on the island of Sulawesi. MIND ID’s share in PTVI will rise to 34% from 20%, while Vale Canada will own 33.9% and SMM 11.5%, previously 43.79% and 15.03% respectively. The divestment represents a key condition for PT Vale to fulfil its divestment obligations, as required by Indonesia’s Mineral and Coal Mining Law and is a prerequisite for extending PTVI’s mining permit beyond 2025. Under the law, foreign investors are required to transfer 51% of their combined stakes to local buyers after a certain period of operation. A senior mining industry official confirmed that the Indonesian government will work on issuing the new mining permit for Vale within ten days after signing the agreement.

PTVI processes laterite ore from the Sorowako mine into a nickel matte containing 78% Ni, which undergoes further processing at Vale’s refinery in Japan and SMM’s operations in Japan. The smelter’s annual capacity stands at 80ktpy Ni, but Vale is progressing with a plan to increase this to 90ktpy Ni over the next few years.