(Refiles to correct source in paragraph 6 to official companystatement, not spokeswoman) JAKARTA, Jan 19 (Reuters) -
Germany's BASF and French miner Eramet are finalising a $2.6 billion partnership deal to invest in afacility in Indonesia to process nickel for use in batteries forelectric vehicles, Indonesian officials said.
The Indonesian announcement comes as Southeast Asia'sbiggest economy has been courting global companies to buildfacilities to produce EV batteries and electric cars to exploitthe country's rich nickel resources.
In separate emailed responses, the companies confirmedthey were assessing a hydro-metallurgical project to producebattery-grade nickel and cobalt from Eramet's mine inIndonesia's Weda Bay, but did not confirm the proposedinvestment.
Indonesia's investment ministry cited BASF chief executiveMartin Bruderm? 1/4 ller as saying the project investment would beworth around 2.4 billion euros ($2.59 billion).
"We would like to convey that our agreement with Erametis at the final stage. It is likely that our decision will betaken in the first half of 2023," the ministry quotedBruderm? 1/4 ller as saying.
Eramet said in a statement the project was subject to afinal investment decision and further details would be disclosedif a decision was made.
BASF spokesman Paul Warkentin also said more detailswould be given once an assessment had been concluded.
The planned plant would produce mixed hydroxideprecipitate (MHP) from nickel through a high-pressure acid leach(HPAL) plant. MHP is used in electric vehicle batteries.
Eramet said the plant could start production in early2026 investment decision subject to a final investment decision,with an output capacity of up to 67,000 tonnes of nickel and7,000 tonnes of cobalt contained in MHP per year.
BASF and Eramet's investment plan was in line with thegovernment's "aspirations to set up Indonesia as world-class EVplayer," said Indonesian Investment Minister Bahlil Lahadalia.
Indonesia
is also finalising agreements with Chinese automaker BYD Group and Tesla toinvest in EV production facilities, a senior cabinet ministersaid on Tuesday.
Once the biggest supplier of nickel to the globalstainless steel industry, nickel producers in Indonesia havebeen retooling so they can take advantage of the growing demandfor nickel in batteries.
While overall battery demand for nickel makes up a smallportion of the 3 million tonne market, Indonesia is primed tobecome the world's biggest supplier as it builds out some 4.5million tonnes of capacity that can supply both markets over thenext five years, analysts estimate.
Investment into MHP production in Indonesia has so farbeen dominated by Chinese companies such as Zhejiang HuayouCobalt and Tsingshan Holding Group.
Separately, Australia's Nickel Industries saidon Wednesday it will raise $471 million in capital to help fundthe acquisition of several nickel projects in Indonesia. To develop battery nickel, the company will also look tocollaborate with Shanghai Decent Investment (Group) Co Ltd, aunit of the Tsingshan Group. ($1 = 0.9270 euros) (Reporting by Bernadette Christina in Jakarta, RishavChatterjee in Bengaluru and Melanie Burton in MelbourneEditing by Ed Davies)
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