Asia Mangan Group, a manganese producer, held the ground-breaking ceremony for its new smelter in Belu, East Nusa Tenggara, on Saturday, the company said in a statement.
The Indonesian incorporated company, part of Asia Minerals, has been working over the past two years to develop the first manganese alloy smelter in the country.
The smelter, built on the island of West Timor, will include an integrated mining and processing facility for manganese ore.
“The purpose of building the alloy smelter is to support Indonesia’s mining law and to create a sustainable industry in the regions that will provide long term export revenue for the country and promote job growth and other benefits for the people of East Nusa Tenggara [NTT]” Asia Mangan Group president director Michael Kiernan said in the statement released on Saturday.
He did not specify the value of the investment in the smelter, but Bisnis Indonesia reported on Sunday, citing Sukhyar, the newly appointed director general of minerals and coal at the Ministry of Energy and Mineral Resources, that the value of investment in the smelter was Rp 1.7 trillion ($139 million).
“The Asia Mangan Group smelter project requires the company to commit to building a whole new supply chain for ore while building a smelter for a commodity that is completely underdeveloped in Indonesia.
“This will create new revenue for the economy and have a dramatic impact on the welfare of the people of NTT,” the statement said.
Asia Mangan said the project would create up to 1,000 jobs for people near the site and is expected to help boost per capita income in the region, currently among the lowest in the country.
Manganese is typically used in the production of steel as an alloying element. According to Asia Mangan, the quality of manganese ore in East Nusa Tengara is the world’s top commercial grade.
Asia Mangan plans to build eight electric arc furnaces that will have a combined annual production capacity of 128,000 metric tons of ferro-manganese alloy, according to the firm’s managing director, Sean McDaniell.
In addition to that, the company is also building its own 75-megawatt power plant to support the project.
The company said it would take three years for the smelter to begin operating at full capacity.
Asia Mangan began its business in Timor in 2011 and is the only approved trading exporter of manganese ore in Indonesia.
Also attending the groundbreaking were East Nusa Tenggara Governor Frans Lebu Raya and Belu district head Joachim Lopez.