Harum Energy, the coal mining, minerals and logistics company owned by Indonesian billionaire Kiki Barki, is planning capital expenditure of $687 million this year, primarily for expanding its nickel business. This is more than 13 times its capital expenditure allocation of $52 million in 2023.
According to a disclosure filed on IDX, the company said it spent $17.4 million on mining property and vehicles as of the end of March.
Tanito Harum Nickel (THN), Harum Energy’s main nickel subsidiary, obtained a syndicated loan facility of $620 million from 12 commercial lenders in April including United Overseas Bank, Oversea-Chinese Banking Corporation, DBS Bank, Bank Permata, and Bank CIMB Niaga. Apart from capital expenditure, that borrowing will be used for working capital and debt repayment.
Harum Energy expanded into nickel mining in 2020 by establishing THN. That company operates three nickel ore mines in East Halmahera, Central Halmahera and Central Sulawesi. Apart from nickel mines, it also owns a nickel refinery, processing facilities and the Indonesia Weda Bay Industrial Park in Central Halmahera, North Maluku Province.
The company has been increasing its investments in the nickel business due to booming demand for electric vehicles. In April, Harum Energy signed a memorandum of understanding (MoU) on strategic cooperation with Hong Kong-based Eternal Tsingshan Group, owned by Chinese billionaire Xiang Guangda.
According to the MoU, in the third quarter of this year, THN and holding company Harum Nickel Perkasa will issue mandatory convertible notes subscribed to by Eternal Tsingshan. Following the conversion, Eternal Tsingshan will own up to 49% in the two companies.
Also in April, THN acquired a 51% stake in Blue Sparking Energy for $206 million. Blue Sparking Energy is developing a high-pressure acid leach facility in the Indonesia Weda Bay Industrial Park, which is expected to start operations in early 2026. The facility will have the capacity to refine 67,000 tons of nickel and 7,500 tons of cobalt per year, both used for making EV batteries.
Last January, another subsidiary, Harum Nickel Industry, increased its stake in Westrong Metal Industry (WMI) from 20% to 80.7% for $215.2 million. WMI has nickel ore processing and refinery plants in the industrial park. Starting operations in March, WMI has a production capacity of between 44,000 and 56,000 tons of nickel pig iron per year.
Kiki founded Harum Energy in 1995 and listed the company in 2010. Kiki also owns a privately held coal mine, Tanito Harum. His grandson Nathan Barki is a minority shareholder in Indonesian oil and gas company Medco Energi Internasional and gold and copper mining company Amman Mineral Internasional. On Wednesday (5/6), Kiki had a fortune of $1.4 billion according to Real Time Net Worth.
