Indonesia has been invited to become a member of the International Nickel Study Group (INSG), an offer that the Indonesian Mining Experts Association (Perhapi) views as beneficial. Joining the INSG could help domestic nickel mining companies enhance their Environmental, Social, and Governance (ESG) standards and practices.
The chairperson of Perhapi, Rizal Kasli, mentioned to CNBC Indonesia that INSG is all about promoting ESG in the nickel industry, and by joining, Indonesia could improve its ESG compliance, which is good news for the nation’s nickel mining businesses.
Currently, Indonesia is a significant player in the global nickel market, contributing over 60% of the world’s production. Rizal Kasli believes that being part of INSG would establish Indonesia as a key indicator for the world’s nickel mining sector, ensuring sustainable operation principles are followed and changing the perception that Indonesian nickel is environmentally unfriendly.
According to Irwandy Arif, Special Staff to the Minister of Energy and Mineral Resources for Mineral and Coal Governance Acceleration, multiple nickel-producing countries have asked Indonesia to rejoin INSG. INSG is an intergovernmental organization established in June 1990, and Indonesia was a member when the organization was first formed.
Indonesia, recognized for holding the world’s largest nickel reserves with production reaching 1.8 million metric tons—50% of the global output—is considering this invitation. Supporting the importance of this move is the country’s high domestic nickel consumption, both high-grade nickel known as saprolite and low-grade nickel called limonite, processed through local smelting facilities. In 2023, the consumption of nickel ore in Indonesia was predicted to reach 145 million tons.
Recognizing the abundant nickel reserves and consumption levels, the Indonesian government is continuously promoting the importance of downstream industry development, including building smelters on the home turf to enhance the added value of products and spur economic growth at both regional and national levels.
Indonesia already has advanced nickel smelter facilities in several areas, such as the Morowali Industrial Park, Stardust Estate Investment in North Morowali, and Virtue Dragon Industrial Park in Konawe—signaling the country’s commitment to strengthen this sector.
