STX acquires 20 percent stake in Indonesian nickel mine

STX's office building in central Seoul [STX]

STX will acquire a 20 percent stake in a nickel mine in Indonesia, the local trading company said Tuesday.

The nickel mine, located on the island of Sulawesi, is estimated to have a nickel reserve of over 200 million tons, according to STX.

With the signing of the latest acquisition deal, the Changwon, South Gyeongsang-based company secured the distribution and sales rights to the nickel produced at the site. STX’s shareholdings in the nickel mine could be as high as 49 percent moving forward.

Nickel is a key material in batteries for electric vehicles.

STX plans to complete due diligence on the mine by the end of 2023 and begin production in the first quarter of next year.

The company currently holds partial ownership of the Ambatovy mine in Madagascar as well, which has a nickel reserve of 150 million tons.

The latest acquisition holds a particular significance, the company said, as the Indonesian government strictly regulates the development of new mines in the country.

STX share price rose 20.88 percent to 16,960 won ($12.90) in the Kospi bourse on Tuesday, up 20.88 percent from the previous trading day.

BY SHIN HA-NEE [shin.hanee@joongang.co.kr]