Nickel Industries (ASX:NIC) Locks Down EV Future with Two Massive HPAL Expansion Plays

Key Highlights

• Nickel Industries (ASX:NIC) secures exposure to more than 16,900 tonnes of annual battery-grade nickel production through two major HPAL transactions
• US$169 million investment into the TMI HPAL project alongside Korean and Japanese industrial giants
• Zero-cash share swap boosts downstream exposure while avoiding shareholder dilution
• Expansion comes amid Indonesia’s tightening approval environment for new HPAL developments
• Existing HPAL operations continue to generate strong margins as demand for battery-grade nickel grows

The global race to secure battery metals has entered a new phase, and Nickel Industries (ASX:NIC) is making sure it has a seat at the table.

The company has unveiled two major transactions that deepen its position in Indonesia’s fast-growing electric vehicle supply chain, adding significant exposure to battery-grade nickel production without tapping shareholders for fresh capital.

At a time when many resource companies are raising equity to fund expansion, Nickel Industries has opted for a different path. The company is leveraging existing assets, strategic partnerships and corporate restructuring to strengthen its downstream battery materials business.

The result is a move that further shifts Nickel Industries away from its roots as a stainless-steel nickel producer and toward becoming a major supplier of critical materials used in electric vehicle batteries.

At the time of writing this article, NIC shares were up by 1.07%, trading at A$ 0.945. Source: MarketIndex 

Two deals, one strategy

The first transaction sees Nickel Industries commit US$169 million for a 17.5% stake in the PT Teluk Metal Industry (TMI) High Pressure Acid Leach (HPAL) project.

The project sits within Indonesia’s Morowali Industrial Park and is backed by a powerful Korean and Japanese consortium including LS MnM and Hanwa.

Once operational, TMI is expected to produce 38,640 tonnes of nickel annually in Mixed Hydroxide Precipitate (MHP), a key feedstock used in electric vehicle battery production. Nickel Industries’ attributable share equates to approximately 6,775 tonnes per year.

Importantly, the project includes a construction guarantee that caps total development exposure at US$965 million while targeting nameplate production by September 2027.

The second transaction is arguably even more intriguing.

Nickel Industries has agreed to exchange an 18% minority stake in its Sampala Mine Project for a 36% stake in the downstream CNE HPAL project.

The deal requires no cash payment.

Under the arrangement, Nickel Industries retains 42% ownership of Sampala and remains operator, while gaining access to an additional 10,208 tonnes of annual attributable nickel production through CNE.

The transaction values Sampala at US$1.342 billion and CNE at US$671 million, allowing Nickel Industries to crystallise what management describes as a significant uplift in value from its original investment.

Why battery-grade nickel matters

The announcement comes as the nickel market continues to split into two distinct camps.

Traditional nickel products used in stainless steel remain challenged by oversupply and volatile pricing. Battery-grade nickel, however, remains strategically important as governments and automakers seek secure supply chains for electric vehicle production.

HPAL technology converts laterite nickel ore into Mixed Hydroxide Precipitate, one of the preferred feedstocks for producing high-purity nickel used in lithium-ion batteries.

By increasing exposure to HPAL operations, Nickel Industries is positioning itself further downstream in the value chain where margins can be materially higher.

The company’s existing HNC HPAL operation generated adjusted EBITDA margins of nearly US$10,000 per nickel tonne during the first quarter of 2026 while operating above design capacity.

Timing may prove crucial

The transactions also arrive as Indonesia tightens its approach to new HPAL developments.

The Indonesian Government has recently indicated restrictions on new HPAL approvals, making existing expansion opportunities increasingly valuable.

Because both TMI and CNE are linked to established industrial infrastructure within Morowali, they are viewed as expansion pathways rather than entirely new developments.

That distinction could prove important as competition intensifies for access to battery-metal processing capacity.

Management focuses on disciplined growth

Managing Director Justin Werner said the transactions demonstrate how the company can continue expanding while preserving shareholder value.

“The share swap allows Nickel Industries to grow whilst maintaining fiscal discipline and removing the requirement for any external equity capital. Through these transactions we have secured capital-light downstream exposure at a fraction of the cost of our Indonesian HPAL peers.”

In a sector where billion-dollar processing facilities often require repeated capital raisings, Nickel Industries is attempting to expand production capacity while keeping its share count intact.

What comes next?

The TMI investment remains subject to development milestones, while the CNE transaction requires shareholder approval because of related-party considerations.

If completed, the two deals would significantly increase Nickel Industries’ exposure to battery-grade nickel production at a time when automakers and battery manufacturers continue searching for long-term supply security.

For a company already valued at more than A$4 billion, the announcement is less about exploration upside and more about building scale in one of the world’s most strategically important battery-metal regions.

As the electric vehicle industry evolves, Nickel Industries is making a clear statement: the future of nickel may not be stainless steel, but batteries.

Source: Nickel Industries ASX announcement dated 24 June 2026, company disclosures and market data.