Nickel Mines Ltd has signed a memorandum of understanding (MoU) with PT Sumber Energi Surya Nusantara (SESNA) to implement, if certain economic parameters are met, 200 MWp of solar capacity within the Indonesia Morowali Industrial Park (IMIP).
The MoU provides for SESNA to undertake the role of “Project Initiator” for developing, financing, constructing, commissioning, owning and operating a 200 MWp solar farm project to significantly scale up the supply of renewable energy to the company’s Hengjaya Nickel (HNI) and Ranger Nickel (RNI) nickel processing operations within the IMIP.
Under the proposed agreement, Nickel Mines will be the long-term offtake partner for SESNA and will not be required to contribute any capital funding. The indicative tariff for electricity is considered competitive with other similar scale solar projects, the company said.
SESNA is, Nickel Mines says, an established and leading solar development company in Indonesia, owning and operating a portfolio of solar feed-in-tariff (FIT) and microgrid projects as well as providing services and solutions such as engineering, procurement and construction (EPC) capabilities, solar financing and other technical development support to commercialise solar projects.
The potential 200 MWp solar project supplements the existing 396 kWp plus 250 kWh battery storage project which the company has entered into with SESNA for integration into the facilities at the Hengjaya mine (pictured), which is scheduled to commission this quarter. The Hengjaya mine, which hosts a JORC compliant resource of 185 Mt at 1.3% Ni and 0.08% Co, currently sources its power from diesel-powered generators. It is anticipated that the Hengjaya mine solar project will reduce diesel consumption by approximately 31 million litres over the 25-year projected project life.
Nickel Mines Managing Director, Justin Werner, said: “It is estimated this solar project could supply up to 20% of HNI and RNI’s current electricity requirements and, in doing so, account for a material reduction in annual CO2 emissions. This solar project marks an important first step in our ’Future Energy’ collaboration with our partner Shanghai Decent and our joint commitment to a more sustainable future for Indonesia’s nickel industry.”
The solar project may be implemented in stages with SESNA committing to finalise and deliver a project proposal within three months of signing the MoU, at which point the company may elect to proceed or terminate the MoU at its discretion.