MIND ID, Indonesia’s Mineral Industrialization Driving Force, Through Injection of SGAR Initial Bauxite

Mempawah, 24 September 2024 – Phase 1 of the Smelter Grade Alumina Refinery (SGAR) in Mempawah, West Kalimantan, succeeded in injecting its first bauxite, signaling the initial driving force of the integrated aluminium industry ecosystem from upstream to downstream. The success of MIND ID, Indonesia’s Holding State-Owned Enterprise for the Mining Industry, will have a significant, positive impact on the growth of Indonesia’s economy in the future.

President Joko Widodo inaugurated the first bauxite injection of Phase 1 SGAR on Tuesday (24/9), accompanied by Minister of State-Owned Enterprises, Erick Thohir; Minister of Energy and Mineral Resources, Bahlil Lahadalia; and welcomed by the management of the MIND ID Group, such as MIND ID President Commissioner, Fuad Bawazier; MIND ID President Director, Hendi Prio Santoso; President Director of PT Indonesia Asahan Aluminium (INALUM), Ilhamsyah Mahendra; President Director of PT Aneka Tambang Tbk (ANTM), Nico Kanter; as well as President Director of Borneo Alumina Indonesia (BAI), Leonard M. Manurung.

This project has entered its commissioning phase with the first alumina production target in November 2024 and is expected to fulfill domestic needs as well as support industry downstreaming efforts.

In his speech, President Jokowi said that the process to build and complete the Phase 1 SGAR project constituted a national struggle. Although the project was delayed, the Management of the MIND ID Group was able to remain committed to building the project to the extent that it was acknowledged as a national strategic project, and completed according to schedule.

“This is not an easy struggle. I know the project was delayed but with the strong spirit and vision, we managed to complete it today. This constitutes the industrialization footprints of our country, Indonesia,” he said.

The President said that Indonesia’s need for aluminium reached 1.2 million tons, 56% of which comes from imported products. SGAR has the potential to stop the 56% import of aluminium and assist the government in saving foreign exchange of about US$3.5 billion each year.

“I am happy to see that the integrated aluminium industry upstream-downstream ecosystem has completed Phase 1. Raw material from Tayan is sent to Mempawah to become alumina, then sent through Kijing to Kuala Tanjung and processed by INALUM,” he said.

Erick explained that through SGAR, the government ensures that mineral downstreaming is occurring in Indonesia, enabling a more optimal, positive impact of the economic effect multiplier.

The government is also committed to reducing imports, thereby eliminating foreign exchange and making future economic stability even better.

“We understand that downstreaming is not a choice but an obligation to boost the growth of the nation’s economy in order to promote the welfare of the people,” he added.

Hendi said that the operation of Phase 1 SGAR is an important achievement in the mineral mining sector in Indonesia. The MIND ID Group is capable of integrating the upstream to downstream sector, thereby providing a higher added value and optimal contribution to Indonesia’s economy.

Hendi explained that after the full operation of Phase 1 SGAR, the MIND ID Group will immediately continue with Phase 2 SGAR. Particularly as the MIND ID Group presently has a land permit that can be used to raise the capacity of the alumina production, while simultaneously building an aluminium processing smelter.

“The design of Phase 1 SGAR occupies 100 hectares, and we still have 500 hectares for Phase 2 SGAR. There will also be an aluminium smelter so that its competitiveness is higher,” he said.

Hendi said that SGAR has a sustainable positive impact on the economy while simultaneously, the social and environmental effects in the operational area as well.

The momentum of the factory infrastructure development and operations is able to absorb labor and activate related economic sectors.

The operations of the mining and industry will also follow the sustainable principle thereby mitigating and reducing the social and environmental impact.

“SGAR is a project we can be proud of, to move the future. Of course, all operations will be maintained in accordance with sustainable mining standards, thereby able to give optimal positive impact in the long term,” he concluded.