Building an Integrated Smelter, MIND ID Could Cut Indonesia's Aluminium Imports
Jakarta — CNBC Indonesia: The Assistant Deputy for Mineral and Coal Development at the Coordinating Ministry for Economic Affairs, Herry Permana, said that intensified downstreaming in recent years could curb Indonesia’s imports. He stressed that downstreaming, tied to natural resources governance, can deliver greater added value.
He cited the downstreaming of bauxite-aluminium undertaken by MIND ID through Inalum and Antam in Mempawah, West Kalimantan, where the groundbreaking ceremony has already taken place.
‘That means, because our aluminium supply chain is robust, in order to reduce imports and allow the industry to grow domestically, it is not easy but we must do it,’ Herry said at the CNBC Indonesia Mining Forum 2026 on Friday, 6 March 2026.
He emphasised that if downstreaming is not pursued now, given the currently buoyant global conditions, Indonesia could miss an opportunity. This situation could also be a lever for the government to push downstream development more quickly.
‘There is no alternative if natural resources are to be optimised; for example, coal must undergo downstreaming. Otherwise we would simply sell raw commodities, which, although it takes time, we must add value to,’ he said.
In early February 2026, MIND ID commenced construction of an integrated bauxite-aluminium downstream project in Mempawah, West Kalimantan. This was marked by the groundbreaking for the Smelter Grade Alumina Refinery (SGAR) Phase 2 and Inalum’s second aluminium smelter on Friday, 6 February 2026.
MIND ID’s President Director Maroef Sjamsoeddin said the groundbreaking signals the creation of a fully integrated supply chain for the aluminium industry. The facility is not merely production but an integrated national industrial ecosystem, spanning raw materials, energy, infrastructure, and human resources.
He disclosed that the total investment in this integrated project, including SGAR Phase 1 already in operation, SGAR Phase 2, Inalum’s second aluminium smelter, and the power plant in Mempawah, West Kalimantan, is projected to reach Rp 104.5 trillion.
‘The construction and operation of the facilities and alumina smelting are a strategic programme with an investment value of Rp 104.55 trillion, or about US$6.23 billion,’ he said.