Indonesian Mining Ministry officials say Central Sulawesi will host the beginning construction phases of a $1 billion nickel pig iron smelter—one of few outside the Chinese mainland—by PT Sulawesi Mining Investment by Q4 2014.

This comes after the world’s No. 1 nickel ore exporter announced a raw mineral exports ban by Q1 2014 in lieu of smelters to boost state revenue and domestic unemployment. The rule, however, has come under fire from miners and Indonesians alike, who say smelters are unrealistic for all Indonesia’s vast—and diverse—mineral exports.

Phase one, by SMI, a joint venture between Indonesia’s PT Bintang Delapan Group and China’s Tsingshan Group, is 30% complete, according to the mining ministry. Initial investment is at $320 million, with expected annual nickel pig iron production at 300,000 mt, mostly for Chinese export.

Phase two, projected to cost another $640 million, is slated begin in Q3 2013 and is forecast to add a further 500,000 mt of output capacity, along with a 450-megawatt power plant; stainless steel will also be produced. The SMI plant will be among the first nickel pig iron smelters outside China, Indonesia’s top consumer of nickel laterite ore.

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