Dirty Nickel, Clean Power: Making the Ocean Bleed Red

Dirty Nickel, Clean Power: Making the Ocean Bleed Red

Dirty Nickel, Clean Power: Making the Ocean Bleed Red

How the race for more efficient batteries is poisoning Indonesia’s coastal waters.


Ternate, Indonesia—The visitor emerges from the airport terminal here into a waft of clove cigarette smoke. Cloves made this island famous. Until the late 18th century, Ternate and the surrounding Maluku archipelago—known by Europeans as the Spice Islands—were the only places in the world that the small aromatic flower grew. In the 15th century, whoever controlled the Spice Islands was bound to make a fortune selling spices at highly inflated prices in Europe, where nutmeg and cloves were all the rage. When Columbus set out on his journey west from Spain, he was searching for a quicker way to get here. When the Dutch colonized the Malukus, they acquired the islet of Run from the British in exchange for another one of their overseas properties: Manhattan.

Now outsiders are once again rushing to these islands to seek a fortune. This time, they are looking beneath the soil for rich seams of metals that are key components of the batteries that power electric vehicles: nickel and cobalt. As countries attempt to address climate change by phasing out gasoline-powered automobiles, these minerals have become the new cloves, traded in complex, globalized markets for higher and higher prices. According to the global metals consultancy Roskill, nickel demand for batteries could rise from about 6 percent in 2022 to more than 36 percent by 2030; over the same period of time, the demand for cobalt is set to double.

Last August, the Indonesian government announced that it had signed a $5 billion contract to sell nickel to Tesla. Benchmark Mineral Intelligence, a specialist information provider for the lithium-ion battery supply chain, projects that Indonesia could become the world’s second-largest producer of cobalt by 2030, after the Democratic Republic of the Congo.

In their scramble to extract these metals crucial to the transition from fossil fuels, however, mining companies have torn up the landscape where these minerals are found and, according to activists and scientists, have polluted the water around the Maluku Islands. They have built coal-fired plants to power their mining and refining operations and have forced out families who have worked the land for generations. From this vantage point, what is being touted as the latest “Green Revolution” looks more like a displacement of pollution from wealthy cities to poor rural communities.

When I met Muhammed Aris on a recent evening in a biker bar on Ternate’s waterfront, he was wearing a blue polo shirt with “Save the Coral” emblazoned across the back. A burly man in his 40s with a penchant for slim cigarettes, Aris has been teaching aquaculture for 20 years at Khairun University. “I want to make sure that the ocean is clean for the long-term life of the marine ecosystem,” he told me. Before our meeting, Aris had spent the day in his lab working on a project to plant seaweed near the village of Jailolo—”it’s a technology transfer to the locals so they can have new ways of making a livelihood,” he explained. His obsession with fish and other aquatic life has also propelled him onto the front lines of the rush for battery metals.

The topic of our conversation was the fate of Obi, another island in the Maluku archipelago. On Obi’s southeastern coast and on the small adjacent island of Malamala, a huge nickel mining operation has stripped the hills of trees and gouged deep scars into the ocher earth. The sea—elsewhere in these islands a shimmering palette of turquoise, teal, and aquamarine—has turned a dull brown that residents call kemerahan (“reddish”). In a 2020 paper, Aris documented 11 different local species of fish that had an “accumulation of heavy metals” that was destroying their organs and that could cause health problems for humans who eat them.

Over the course of two weeks this winter visiting the Malukus and Southeast Sulawesi, another of Indonesia’s nickel-rich provinces, I interviewed over 30 fishermen, farmers, teachers, miners, activists, and other residents of the scruffy seaside villages that abut some of Indonesia’s largest nickel mining operations, as well as employees of and contractors for the companies. Many complained about how mining companies had grabbed land, forcibly displacing residents and providing them with inadequate reimbursements, and had polluted farms.

In the Malukus and in Sulawesi, most of the largest mines are majority-owned by Chinese groups, and the people I spoke with complained about the employment of Chinese nationals over Indonesians. Almost without exception, my interviewees told me that the mining operations had turned the sea kemerahan and that it had become nearly impossible to fish in the vicinity. “The fish don’t come near here any more,” said Lisman Musahati, a 27-year-old fisherman from Soligi, a village about four miles from the main mine site on Obi. “The waste from the mines is destroying the coral reefs, and we can’t fish in this area anymore. We have to go farther out to catch anything—
20 miles out and further in small boats.”

In response to such charges, Anie Rahmi, the corporate communications manager of Harita, wrote in a letter to The Nation that Harita contributes to local prosperity, that more than 85 percent of its workforce is Indonesian, and that the company upholds strict environmental standards. “The presence of Harita Nickel has been contributing to the national and regional development since 2010,” Rahmi wrote, “and economic growth in North Maluku Province has increased since the existence of the smelter industry.”

In the centuries after Dutch colonization, the cultivation of cloves and nutmeg was introduced elsewhere—Mauritius, Zanzibar—and the Malukus became a sleepy backwater. A secessionist movement emerged in the wake of Indonesian independence in 1949, but it was quickly crushed, and the islands returned to somnambulance. It wasn’t until Indonesia began issuing nickel mining permits in the 1990s that the Malukus’ reawakening began.

In past decade, Indonesia’s nickel industry has boomed and investments have poured in. One of the catalysts of this growth was the development in the early 2000s of a lithium-ion battery that uses NMC, a compound made of lithium, nickel, manganese, and cobalt, in its positive electrode, or cathode. (Pure lithium is avoided in batteries because of its tendency to catch fire.) NMC batteries allow electric vehicles to go farther and faster than previous technologies, and they are especially popular in the United States and Europe, where they have been adopted by companies like Audi, Ford, and Tesla. Indonesia, the world’s largest producer of nickel, contributes more than a third of the global supply.

As demand for the batteries has risen, so has demand for the other metals that constitute them. In the Democratic Republic of the Congo, a boom in copper and cobalt mining has led to rampant corruption, with government officials being paid off by mining companies, and there have been allegations of child labor in some mines; in Chile, where lithium is extracted from salty underground lake water, Indigenous groups have accused lithium producers of pumping too much brine out of a delicate ecosystem.

And in almost every nation that is a major source of battery metals, Chinese companies have made strategic investments that now give Beijing an unprecedented level of control over the global supply chain. A large part of the reason for this is that Chinese policy-makers hope the adoption of electric vehicles will alleviate the pollution in that country’s cities. Critics, however, have ascribed more sinister motives to Beijing’s quest for superiority in the battery industry, likening it to an “arms race” and even suggesting that China could destroy the electric vehicle industry in other countries by cutting off the supply of critical metals. As the mining financier Robert Friedland put it at a commodity summit in 2018, “This disruption is coming to a theater near you, but you don’t know about it, because you’re not a member of the Chinese Communist Party. You’re too far away from Beijing, where there’s a command economy and this man who is president for life is absolutely on a jihad to convert the world to electric vehicles.”

China and Indonesia already had bumpy relations in the decades after Indonesian independence, mostly because of Jakarta’s rabidly anti-communist policies under Suharto (during the 1960s, for example, some 500,000 Communists were killed by the military and religious groups) and its persecution of the country’s ethnic Chinese. After the Indonesia-China Strategic Partnership was signed in 2005, however, China began to dominate Indonesian industries, and China’s Xi Jinping forged a close relationship with Joko Widodo, the current Indonesian premier. Chinese companies invested heavily in Indonesia’s mining sector and built more coal power plants there than in any other country.

Shortly after the rapprochement between China and Indonesia, the Harita Group applied for a mining permit on Obi Island. Harita began in 1915 as a grocery store started by a Chinese immigrant to Indonesia. By the first decade of this century, the company had expanded into timber, palm oil, gold, and nickel mining, making its owner, Lim Hariyanta Wijaya Sarwono, a billionaire. In 2008, mining operations began at a site on Obi that would eventually come to resemble a miniature city. Four years later, Harita announced plans for an initial public offering for its nickel division in Singapore to raise $250 million, and a subsidiary advertised in the city’s central business district with the slogan “Mum was wrong. Slow and steady doesn’t win the race.”

With their vivid green forests and bright blue water, the Maluku Islands make an indelible impression on anyone who visits. The hills of Obi are often swathed in fog and thundering clouds, and local legend holds that ghosts watch over the town from the woods. Endemic species of butterflies, flying foxes, and a “paradise crow” live among the trees, despite the encroachment of loggers in recent years. In the sea, far away from the mine, shallow coral reefs alive with colorful clownfish and Moorish idols stretch for miles.

The main town on Obi, Laiwui, a three-hour ride by motorized canoe from the mine site, is a laid-back place of cinder block bungalows that occasionally reverberate with music from passing vehicles. Few outsiders visit—getting here involves several flights and a 19-hour ferry trip. “Obi is a unique place,” Abdul Kahfi, the 38-year-old chief of Laiwui, told me. “There are no Indigenous people here, [and] so many people have come over the years from all over Indonesia—from Java, from Sulawesi—it looks like a miniature Indonesia.”

The only people on the island who seem to be in a hurry are the employees of Harita, true to its advertising in Singapore. In 2015, only seven years after it broke ground on Obi, Harita announced that it was expanding its operations there, this time teaming up with subsidiaries of Xinxing Ductile Iron Pipes Co., a Chinese state-owned enterprise based in Hebei Province, to build a $320 million smelter to refine nickel ore. But this was peanuts compared with the new $1.05 billion smelter, fired by a huge coal power plant, that would come on line in 2021, this time financed by Harita and another Chinese company, Lygend Resources. Two Chinese electric vehicle battery manufacturers, GEM and Easpring, agreed to buy nickel and cobalt by-products from the new venture for eight years.

On a sunny day in May 2021, dressed in turquoise factory work wear and a red hard hat, Jiang Xinfang, the president of Lygend, gave a rousing speech at a ceremony celebrating the first batch of products from the new smelter. “We have every reason to believe,” he said, “that this project will achieve the record of reaching production standards as soon as possible in the industry and create more miracles!” He lauded the “professional planning scheme” that envisioned for Obi—an island that is remote even by Indonesian standards—airports, supermarkets, and shopping malls, as well as a “new town with complete supporting facilities, livable environment, and humanistic characteristics.”

But there was a darker side to what was happening on Obi. One of the problems was where to put the waste, or tailings, that resulted from the production of nickel. Two years before, according to the environmental reporting website Mongabay, Harita backed down from a plan to pump 6 million tons of waste into the deep sea in the face of protests. But damage was already being done. The Indonesian magazine Tempo reported in early 2022 that waste was being pumped out of a black pipe and that mountains of polluted soil were being washed into the sea. When I was there, the waste pipe had apparently been moved, but the sea around the mine site was still “reddish” with dirt, and fishermen complained that it was almost impossible to fish. “The thing I love most about Obi is the fish, but now, after the mining, the fishermen can’t catch fish,” Kahfi told me.

It is perhaps hard to believe that such a remote and ostensibly wild a place as Obi belongs to anyone, but Harita and Lygend were not operating in a vacuum. Much of the land they were developing had been farmed by local people who came to the island long before the companies arrived there. When Harita’s subsidiaries retroactively tried to compensate the former owners, they offered them a pittance. “The company grabs the land of the locals,” said Kahfi’s colleague Faldi Usman, who represents the people who live near the mine site. “We think it is wrong.” (“No land previously or currently owned by local communities were utilized for its operations on Obi,” Harita’s spokesperson insisted.)

Now Harita is trying to gain control of even more territory to build more industrial facilities and the airport mentioned by Jiang in his speech. Watila (like many Indonesians, she goes by one name), a woman in her 60s who lives in Soligi, was offered only 12,000 rupiah—around 75 cents in US dollars—per square meter. She has lived off the income from her clove and coconut trees for the past four decades, but now the company wanted her land to build the airport. “They are pressuring me to sell my land,” Watila told me, “but they are offering too little.”

Aris, the professor in Ternate, began hearing from relatives in Obi about the damage being done to the environment shortly after the first mine site came on line. “My wife is originally from Obi,” he told me. He said that he approached Harita in 2010 about doing an environmental study near the Obi mine site. After nine years, Harita finally allowed him to start testing the water in the area, although his access to a multitude of sites, including the main mine, was severely limited and in some cases prohibited.

Nevertheless, Aris was able to collect samples of water, fish, and fluted giant clams, and he prepared three academic studies presenting his findings. He wrote in one paper that his research found “degeneration and cell necrosis” in fluted giant clams. The clams are listed as a “conservation dependent” species, because their natural habitat has been impacted by humans. “This change is thought to be influenced by heavy metals,” he continued. “Heavy metal content in liquids exceeds the quality standard threshold.” In another paper, he noted degradation in fish tissues. He also found levels of ammonia, nitrate, dissolved oxygen, nickel, and iron that exceed the water quality standards set by the government. In his conclusion, he described the findings as “a reference for warning of heavy metal pollution in Obi Island waters.”

When it came time for Aris to publish his results, Harita contacted him. “They asked me to change the data,” Aris told me. When he refused, the company tried to prevent the study from appearing. “They sent a letter to the university,” Aris said, “and the rector spoke to me directly and told me not to publish that the water pollution level was over the limit.” (Harita disputed this characterization; Khairun University did not respond to multiple e-mails seeking comment.) Aris decided to publish his findings despite the pressure. Since then, he has not received funding to conduct another study in Obi. And it is not just Aris who has said that the water is polluted: A separate water sample commissioned by The Guardian last year revealed that the cancer-causing chemical hexavalent chromium—of Erin Brockovich fame—was present in alarmingly high levels in water near the mine site.

When I visited Kawasi, the village nearest to the mine, early one morning this past December, I saw just how the landscape had been wrenched from wilderness to dystopia by Harita’s nickel operations. Tall smokestacks belched gray and red smoke, and a river gushed reddish water into the blue sea. The heavy rain forced us ashore, prompting an admonition from my translator not to reveal that we were journalists, because, he said, security forces were in league with the mining company. Kahfi, the Laiwui chief, would later tell me that he was arrested and jailed for two months for protesting at the mine. Local journalists, he said, had also been detained after they approached the mine. A pair of Indonesian warships hung menacingly on the horizon.

Our boat landed on a drab beach pocked with litter. Chickens picked at the plastic bottles and packaging. Despite the state-of-the-art nickel refining facility yards behind the town, there were no drains or trash collection, so the sea was used as a dump by the local population. Through the sheet of rain, we saw the glow of a fisherman’s clove cigarette. He beckoned us onto the porch of his home. We watched the rain for hours and talked about how the company had plans to displace the people of Kawasi. When the rain stopped, the air began to reek and I tasted metal in my mouth. Far from any electric vehicle charging point, the people of the village revved up the diesel engines of their canoes and headed out to look for fish in the reddish murk.

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