Indonesia has signed a Memorandum of Understanding (MoU) with LG Energy Solutions, a subsidiary of LG Chem, on December 18, 2020 on a $9.8 billion investment agreement for electric vehicle batteries, Bahlil Lahadalia, head of Indonesia's Investment Coordination Board, said at a press conference.
An official at LG Energy Solutions confirmed the fact to Reuters but could not provide details or the amount of the transaction.
According to Bahlil, under the MoU, at least 70% of LG Energy Solutions' nickel ore, which is used to make electric car batteries, must be processed in Indonesia.
He said the deal would make Indonesia the first country to successfully consolidate the battery industry.
"We signed a memorandum of understanding to build an integrated battery plant from upstream to downstream.
Everything from mines, smelters, precursors, positive electrodes, cars (manufacturing) to recycling facilities will be built in Indonesia."
The projects will be built in Indonesia's North Maluku province and central Java island, he said.
At present, "high nickel and low cobalt" has become the consensus in the battery industry. Indonesia, which has rich nickel mineral resources, has long become a battle field.
Earlier, it was reported that Tesla would send a delegation to Indonesia in January to discuss potential investments in its electric vehicle supply chain.
Later, Indonesia's Ministry of Ocean and Investment said that China's leading power battery company Ningde Times also had an interest in Indonesia and planned to invest $5 billion to build a lithium-ion battery plant in Indonesia, and the two sides agreed to ensure that 60% of the nickel would be processed into batteries in Indonesia.
