Korea’s STX acquires 20% stake in Indonesian nickel mine

STX Corp. headquarters in Seoul. [Photo by Lee Seung-hwan]

South Korea’s general trading company STX Corp. has acquired a 20 percent stake in a nickel mine in Indonesia.

STX said on Tuesday that its board of directors approved the stake acquisition in a meeting held on Monday. The mine is expected to begin production in the first quarter of next year.

Following the deal, STX has established a nickel supply value chain in Indonesia, ranging from nickel ore mining to transportation and sales.

Nickel is used as a raw material for cathode materials, a crucial component for electric vehicle batteries.

The nickel mine, located on the island of Sulawesi, is estimated to have a nickel reserve of over 200 million tons, according to STX.

The projected annual production capacity is up to 400 billion won ($303.75 million), which is worth 80 billion won for STX, which holds a 20 percent stake.

STX has also secured the right to transport and sell all of the nickel ore mined from the mine.

The company also has the option to increase its stake in the mine by 29 percentage points to up to 49 percent.

“Through the investment, we will strengthen our position as a specialized company in the secondary battery material industry,” said an STX official. “We will lead the way in building a stable supply chain.”