EcoPro, a South Korean battery materials holding company, said Monday that it had invested $11 million for a 9 percent share in Green Eco Nickel, an Indonesian nickel smelter operated by Chinese battery materials firm GEM, to expand the supply of nickel, a crucial raw material for lithium-ion battery production.

The Green Eco Nickel smelter, situated on Sulawesi Island in Indonesia, boasts annual production of approximately 20,000 tons of nickel. The investment will allow EcoPro to gain additional nickel proportional to its shareholding. Indonesia is known for holding the largest reserves and production capacity for nickel worldwide.

The company will gradually increase its ownership in the Green Eco Nickel smelter, aligning with the incentives of the US Inflation Reduction Act.

EcoPro Materials, a subsidiary of EcoPro that specializes in producing precursors for anode materials, is on track to produce around 200,000 tons of precursors by 2027. To meet this production target, EcoPro needs to secure approximately 100,000 tons of nickel.

Previously, EcoPro expanded its nickel supply chain through investments in QMB 1 and QMB 2, two other nickel smelters operated by GEM in Indonesia's Morowali Industrial Park. These facilities together produce 50,000 tons of nickel annually.

The nickel obtained from the Indonesian smelters is processed into nickel sulfate by EcoPro Materials. This nickel sulfate serves as a raw material for precursors, which is subsequently used for cathode production by affiliates EcoPro BM and EcoPro EM.

During a shareholders meeting in March last year, EcoPro officially updated its company charter to include the exploration, extraction and development of resources and materials, both at home and abroad.

“EcoPro committed to further investments in nickel smelters, essential for secondary battery production. Additionally, we plan to expand our presence in Indonesia with another investment, aligning with the demands of the IRA," said Jang In-won, head of global resources development at EcoPro.