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The promise of nickel: Power and prosperity in Indonesia

(Graphic by Bruce Crocker/WBUR)
(Graphic by Bruce Crocker/WBUR)

To electrify our economy, the world needs more nickel. And Indonesia has it.

Can nickel pave the road to prosperity?

Today, On Point: In part four of “Elements of Energy,” hear how the rush for metals is shaking up global geopolitics.


Cullen Hendrix, senior fellow at the Peterson Institute for International Economics.

Also Featured

Mari Pangestu, former trade minister of Indonesia.

Habib Nadjar Buduha, founder of Tolitoli Labengki Giant Clam Conservation.

Elina Noor, senior fellow, Asia Program at the Carnagie Endowment for International Peace.

Christopher Pollon, author of “Pitfall: The Race to Mine the World’s Most Vulnerable Places.

Jose Fernandez, U.S. Under Secretary of State for Economic Growth, Energy, and the Environment.

Additional reporting by Leo Galuh.


Part I

MEGHNA CHAKRABARTI: Episode four. The promise of nickel.

ERNEST SCHEYDER: Nickel is a grayish metal commonly used as an alloy to make stainless steel.

In an electric vehicle battery, it can increase energy density and storage capacity, thus allowing the vehicle to move farther on a single charge. Indonesia, Australia, and the Philippines are the world’s largest nickel producers. Indonesia’s nickel production has nearly tripled since 2020, and the country now accounts for more than 50% of global supply.

Controversially though, the nickel production methods in Indonesia have not been at the same standards expected of Western miners, fueling controversy across global nickel markets. The only U.S. nickel mine will be depleted by 2025.

CHAKRABARTI: That nickel primer provided, as he has all this week, by Ernest Scheyder, author of “The War Below: Lithium, Copper, and the Global Battle to Power Our Lives.”

As Ernest says, the nickel story is an Indonesian story. In 2022, global production of nickel hit approximately 3.3 million tons. And fully half of that came from Indonesia.

Nickel plays a critical role in the clean energy future. It’s so essential to the development of electric vehicle batteries, the element was a frequent point of discussion from Tesla executive Andrew Baglino at Tesla Battery Day 2020.

ANDREW BAGLINO: And that’s what we have on the chart here. Dollar per kilowatt or a cathode of just the metal. And you can see nickel is the cheapest and the highest energy density. And that’s why increasing nickel is a goal of ours and really everybody’s in the energy and in the battery industry. 

CHAKRABARTI: Indonesia’s most important nickel reserves are on the islands of Halmahera and Sulawesi. And It’s on jungle-capped Sulawesi where we met Habib Nadjar Buduha.

Buduha is multi-talented. He’s made a living as a journalist, as a tour guide, and as a scriptwriter for Indonesian soap operas. But in 2009, Buduha found his true calling in marine protection. He’s founder of the Toli Toli Labengki Giant Clam Conservation project.

(TRANSLATION): The largest one ever found was 137 centimeters. Around here though, they’re only around 90 centimeters. 

CHAKRABARTI: That’s almost three feet across. The largest are known to grow to more than four feet. So, yes, Tridacna gigas are gigantic. They can weigh hundreds of pounds and live for more than 100 years.

Giant clams were once common in the turquoise shallows off the Sulawesi coast. But starting in 2014, Buduha discovered they were getting harder to find, because they were being buried alive. Thanks, in part, to nickel mining.

(TRANSLATION): Poor mining management causes soil and mining waste to enter the sea. It’s killing the clams. The sediment buries them. We found one area where the sediment exceeded one meter in the year 2021 alone.

CHAKRABARTI: Buduha’s 2014 discovery came precisely the same year that then-Indonesian president Susilo Bambang Yudhoyono approved a total ban on mineral ore exports out of the country. It shook up the global nickel industry, and since then, the hills and rainforests surrounding Sulawesi’s coastline have been razed for new nickel mines and processing facilities.

For Indonesia, the nickel export ban wasn’t simply a powerplay to control global mineral supplies. It was a central part of the government’s long-term plan to leverage nickel’s importance in the clean energy future to bring greater development and prosperity to Indonesia now.

NICKEL AD: Amidst the world slowdown, we stand firm as home to a fifth of global nickel reserves. Indonesia is poised to lead the global EV battery industry. 

CHAKRABARTI: In fact, nickel is so valuable to Indonesia the government touts it, in television ads like this one, that air around the world. Or, as current president Joko Widodo told the Economist when Indonesia hosted the G-20 back in 2022:

PRESIDENT JOKO WIDODO (TRANSLATION): Yes, we want to build a large ecosystem for EV batteries. And this will provide added benefit for Indonesia. That’s what we’re after.

NICKEL AD: Committed to environmental protection, enhancing investment climate through digital licensing. Indonesia, you are better tomorrow. 

CHAKRABARTI: In Sulawesi, Habib Nadjar Buduha says the nickel hasn’t bettered the tomorrow for many island residents or the environment. In the dry season, winds whipping through the strip mines kick up dust storms. In the rainy season, mud from the mines pours through local villages and into the ocean, burying the adult giant clams.

BUDUHA (TRANSLATION): The seawater used to be clear. Now it’s like a river, especially during the rainy season. You can’t see anything in the water. It’s murky. Very murky. The color is reddish brown.

CHAKRABARTI: The mines themselves aren’t the only problem. Sulawesi’s air and water are further polluted by a new, closely related industry. One that seemed to spring up almost overnight along the Sulawesi coast. In 2021, Chinese-owned companies began setting up sprawling smelting plants that turn raw nickel ore into EV grade battery metal.

BUDUHA (TRANSLATION): This is a very sad situation. Very, very, very sad.

CHAKRABARTI: And this past December, 21 people died when a fire broke out at one of those smelters, owned by a division of China’s Tsingshan Holding Group.

Buduha says coral reefs are also being buried in pollution. Some fish are disappearing from nearby waters. That forces local fishermen further out to sea to pursue their catch at greater expense and risk. So while Indonesia’s national economy may be growing, mining and smelting are creating existential challenges for communities that rely on healthy oceans and forests.

BUDUHA (TRANSLATION): The forest is already cleared. It will become barren land. Imagine how difficult it would be to survive in a place like that.

CHAKRABARTI: There are few signs that Indonesia will veer away from its plans for national prosperity via nickel mining. When President Widodo says he wants to create an entire eco system for EV batteries, he has in mind things like this:

ELON MUSK: Saying how do we get from the nickel ore in the ground to the finished nickel product for a battery. And so we’ve looked at the entire value chain and said, how can we make this as simple as possible?

CHAKRABARTI: Tesla Founder and CEO Elon Musk in 2020. In 2023, Tesla hinted that it was close to finalizing plans to build a battery plant in Indonesia. That summer, though, Musk snubbed the Indonesian government by announcing Tesla would focus its Southeast Asia efforts out of Malaysia instead. And there are signs that the global EV market is trying to move away from nickel-based batteries – which we’ll hear about later.

These are setbacks, but not permanent ones in the eyes of the Indonesian government.

They already claim major changes. For example, per capita income is up. It reached $4,580 in 2022. But to get into the top five economies, Indonesians’ incomes will have to quadruple. As such, President Joko Widodo promised major reforms of the nation’s educational and vocational systems.

Indonesia proclaimed independence from Dutch colonial rule on August 17, 1945. Today, the government is unwavering in its stated goal to transform the world’s fourth most populous nation into one of the world’s largest economies. And it wants to do it by Indonesia’s 100th birthday, which the government is calling “2045 Golden Indonesia.”

President Widodo is term-limited and will leave office this October. He is resolute in his belief that nickel and other elements essential for clean energy will pave the way to a new Indonesia. His own path may be evidence of that. Widodo is the nations’ first president who does not come from Indonesia’s political or military elite. He used to run a furniture factory.

 (TRANSLATION) “There is a change in mindset. A change in the way of working,” Widodo says. “I believe with the power of natural resources and the strength of human resources, I believe it is true that this country will be able to leap forward.” 

CHAKRABARTI: When we come back —

We were colonized for 350 years. In the next 70 years, we are just still producing commodities, which was the reason why we were colonized. Something has to change.

CHAKRABARTI: Episode four of our series “Elements of energy” continues in a moment. This is On Point.

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