Nickel Industries Ltd.

Nickel Industries Ltd. is a mid-tier nickel producer headquartered in Sydney, Australia, operating primarily in Indonesia. The company's portfolio consists of 3 projects, comprising 1 operating mine and 2 advanced exploration projects. Key assets include Hengjaya and Sampala. The business model centers on being a low-cost, diversified producer through a vertically integrated operational structure. This integration is achieved via a strategic collaboration with a key industrial partner, which provides unique capabilities in funding, construction, and project execution, enabling the enterprise to operate effectively through commodity cycles. The organization has diversified its processing capabilities from rotary kiln electric furnace technology, primarily for the stainless steel supply chain, to include high-pressure acid leach processing to produce inputs for the electric vehicle market. This product diversification is designed to access different end-markets and pricing mechanisms, enhancing revenue stability. A core competitive advantage stems from the ability to control large ore resources and integrate them with downstream processing facilities, which provides significant operational and strategic benefits. This structure aims to insulate the business from input cost volatility and consolidate its position as a globally significant producer.

Strategic focus centers on achieving self-sufficiency in ore resources to mitigate exposure to input price fluctuations, which represent the largest operational cost. The organization is expanding its production profile to include higher-margin products like cathode and sulphate, which is also expected to materially reduce the carbon footprint per unit of metal produced. A key long-term objective is to achieve net-zero emissions by 2050, supported by proactive investment in renewable energy and the adoption of low-carbon technologies. The business strategy involves growing mining and processing capacity during periods of compressed margins, positioning the entity to capitalize on future price improvements. Capital allocation is directed towards completing and commissioning new high-pressure acid leach facilities, with construction progressing on key infrastructure. Management approach involves continually seeking to protect the business from external shocks while promoting responsible and sustainable operating practices.

Executive leadership includes an Executive Chairman with over 40 years of experience in the management of natural resource companies and a Managing Director with 20 years of industry experience, including leading turnaround projects for major global mining companies. The board of directors is committed to maintaining high standards of corporate governance, with its practices reviewed against the 4th edition of the ASX Corporate Governance Council recommendations. Governance framework includes a Sustainability Committee that oversees climate-related risks and opportunities, reporting to the board quarterly. This committee is authorized to conduct evaluations and retain external consultants to ensure transparency and accountability. The board held 7 meetings during the 2024 financial year. Key committees, including Audit, Remuneration, and Sustainability, provide specialized oversight, with non-executive directors receiving additional fees for their service on these committees.

The organization has committed to a 50% reduction in carbon intensity by 2035 and achieving net-zero emissions by 2050, using 2022 as a baseline. Decarbonization initiatives include the phased transition to an EV haul truck fleet, supported by a battery charging and change-out facility, following a successful trial in 2023. Renewable energy adoption is underway, with a solar installation supplying approximately 20% of one mine's electricity demand, complemented by a 250kWh storage system. The company also transitioned to electric loaders from diesel models at certain operations. Social development programs include a university scholarship initiative established in partnership with Hasanuddin University, providing full financial support for 10 local students annually to pursue degrees in metallurgical, environmental, and mining engineering. Environmental stewardship is demonstrated by the formal endorsement from a conservation agency to develop a 197-hectare high-conservation biodiversity area within a mining concession.

The corporate structure is defined by a foundational collaboration agreement with a key industrial partner, Shanghai Decent, which is also a substantial shareholder. This partnership underpins the development, construction, and operation of the company's processing facilities and includes offtake agreements for all NPI production. In 2024, the company increased its equity interest in the Excelsior Nickel Cobalt project to 44% through cash payments totaling $695.8M. The organization also signed definitive agreements in August 2024 for the acquisition of the Sampala Project, which consists of 3 contiguous mining licenses, to advance its strategy of ore self-sufficiency. In September 2024, the company completed the acquisition of an initial 51% interest in the Siduarsi Project through a share issuance and meeting expenditure earn-in requirements. Major shareholders include PT Danusa Tambang Nusantara, which acquired its stake through a placement in 2023, and various entities associated with the primary collaboration partner.