* Battery chemicals plant to start next year -president
* Tailings dam will add to initial budget of $700 million
* GEM to need 36,000 tonnes of cobalt for battery ops in
2025
(Adds details on nickel and cobalt needed by GEM, quotes,
details on plant output targets)
By Tom Daly
YICHANG, China, Nov 5 (Reuters) - Chinese battery firm GEM
Co Ltd 002340.SZ expects to start trial production at its
Indonesian nickel and cobalt plant in August 2020, with the
first phase of operations up and running by the end of the year,
its president said on Tuesday.
The plant, Indonesia's first to produce chemicals for use in
batteries for electric vehicles, has attracted attention for its
ambitious timeline as well as its low budget.
GEM and its partners - which include stainless steel and
nickel maker Tsingshan, a unit of Contemporary Amperex
Technology Ltd 300750.SZ , and Japanese trading house Hanwa Co
Ltd 8078.T - started work on the facility this past January.
Such plants normally take four years to complete, sources
have told Reuters. But GEM president and board chairman, Xu
Kaihua, told reporters at an industry event that 30,000 tonnes
of production capacity will be online by end-2020, with 20,000
tonnes of annual capacity being added the following year.
"It is progressing very smoothly," Xu said.
He said the $700 million budget for the plant was "no
problem", although he added that a tailings dam, currently going
through an approval process, would raise the overall cost.
He gave no further details but said the dam would need to be
about 30 metres high to meet requirements for tailings.
Sources told Reuters in July the price tag for the plant
would eventually rise to more than $1 billion.
The plant, sited in Indonesia's Morowali Industrial Park,
will eventually have the capacity to treat 50,000 tonnes a year
of nickel ore, to produce 20,000 tonnes of mixed hydroxide
precipitate and 30,000 tonnes of nickel sulphate, GEM said.
The company, which claims to be the world's top purchaser of
cobalt raw material, expects to need 36,000 tonnes of cobalt
annually for battery production by 2025, up from 21,000 tonnes
this year.
But the portion it needs to purchase will fall as its
Indonesia plant comes online.
GEM's annual nickel demand will grow to 76,000 tonnes by
2025, from 25,000 tonnes now.