Okay. Good morning, ladies and gentlemen. Thank you for coming in INCO Year's end Analyst Gathering 2025. On behalf of the management, I would like to apologize for our President Director and CEO, [Non-English content] Bernardus Irmanto, as well as our Vice President Director and Chief Operating Officer, [Non-English content] Abu Ashar, are unable to join us this morning. However, we still have the rest of BOD member join us here physically. [Non-English content] Budiawansyah, Director and Chief Sustainability and Corporate Affairs Officer, also on the way. Coming in the right time. Good morning, [Non-English content] Budi. Thank you for coming, [Non-English content]. First, let me greet and introduce you to our BOD member. First, we have [Non-English content] Rizky Andhika Putra, our Director and Chief Financial Officer. Good morning, [Non-English content] Rizky. How are you, [Non-English content]?
I believe most of the team here have met [Non-English content] Rizky before, but if it's not, I think today is a good moment for you to meet [Non-English content] Rizky in person. Next, I'll move on to [Non-English content] Muhammad Asril, our Director and Chief Project Officer. Good morning, [Non-English content] Asril. How are you, [Non-English content]? If I may speak a little bit with you, today is gonna be special because [Non-English content] Asril will show you something about our recent development progress from each project area. Instead of doing a usual presentation, he has a surprise today. Let's see and hear from him directly live from our side. Next, we also have [Non-English content] Heriyanto Agung Putra as our Director and Chief Human Capital Officer. Good morning, [Non-English content] Heri. How are you, [Non-English content]? Thank you for coming.
In the next few minutes, [Non-English content] Heri will also present something about our culture transformation post-divestment last year. I think it's good to have an update from him directly today. Next, we also have [Non-English content] Slamet Sugiharto, our Director and Chief Strategic Technical Officer. Good morning, [Non-English content] Slamet. How are you, [Non-English content]? Also interesting today because [Non-English content] Slamet will also present about our exploration activities in the near future. I think this is something that our capital market team here are awaiting, [Non-English content]. For your information, team, [Non-English content] Slamet is our newest BOD member, appointed through the EGMS on September 23rd, 2025. Okay. I will next move on to [Non-English content] Budiawansyah, our Director and Chief Sustainability and Corporate Affairs Officer. Good morning, [Non-English content] Budi. How are you, [Non-English content]? Thank you for coming.
[Non-English content] Budi will also present something about our sustainability progress and the latest achievement through awards that we have, as well as the IRMA 50 journey. Interesting to see and hear from him directly. All right, last but not least, we also have [Non-English content] Vinicius Mendes Ferreira, our Director and GP Streaming. Good morning. [Non-English content] Vini, how are you? Thank you for coming. Okay. Without further ado, I will pass the station to our BOD members to begin the presentation. The first agenda about third quarter 2025 key updates will be presented by our Rizky Andhika Putra, Director and Chief Financial Officer. [Non-English content] Rizky, the floor is yours. Thank you.
Okay. Good morning, and probably good evening to some of you joining online. Welcome, and again, thank you for joining our annual event. I think the purpose, same as last year, we try to have this at least once a year. We try to have an intimate session. Most of you I think I've met several times throughout the year. But it's a good opportunity for you guys as well to meet our BOD members. We try to have all of the BOD members to join offline. But unfortunately, there's a visit that our President Director, [Non-English content] Anto, and also [Non-English content] Abu, our BPD, needs to attend. But I think we have a lot joining here, and the spirit today, I think, is for us to have an interactive discussion.
I propose this actually not so much on the presentation side, more on the Q&A side. At the end of the day, I believe you guys already see the third quarter number that we have, right? I think it's more of how we approach the close of 2025, and especially when it comes to the context of 2026. And I think I would like to start off with a bit of a reflection point. I think we can all agree that 2025, specifically in isolated, is not an easy year for nickel, right? Especially when we compare to other commodities. Nickel in general, when we compare to the previous year, like 2023, it has its challenges, right? We start the year with some regulatory surprises. We started the year with the continued decline and pressure on the pricing side of things.
But I think the optimism, it's still there, right? Seeing all of you here, having most of the BOD here as well, it actually reflects that we still believe in the long-term value of nickel, right? And I believe we are here to witness one of the inflection point of PT Vale Indonesia as well. If I flashback to the position that we had on 2024, we were a one smelter company with one mining site only active in Sorowako for quite some time. 56 years since inception. It has been about, it has been operating that we have been accustomed to, but today we're heavily expanding. I think when it comes to 2025, all of you already witness, and later on, we will have a specific session on our new operational site as well. We had the Bahodopi site onstream in July.
Some portion of sales already coming in, but in 2026 it would be a game changer. So that is Morowali, and then Pomalaa would be the third site as well when we approach 2026 later on. So what I'm seeing is actually when we believe in the long-term value of nickel, we also see the long-term value of PT Vale. We have a position to play in the Indonesian market and the nickel space, but we will come in a different volume. So I think the idea today is actually to share more and discuss more on what the management and also the company is aiming to be. Our profile would be significantly different when it comes to operational side, and later on, also in the financial side of things. I would like to start a bit with the third quarter updates.
I think, most of you probably already aware with the publication that we had. In terms of third quarter, we had a higher nickel matte production. I think this was already anticipated back in the first half of 2025. At that time, we had an incident in the first half, which is an electrical issue that we had at the time, and we took the privilege to actually took some of the maintenance portion to the first half of 2025. Hence, the result is actually reflected in the third quarter and follow through, hopefully, in the fourth quarter of 2025. So higher production in the nickel matte. And come along with it actually with a higher payability.
I think if you guys have noticed, starting the shipment of July, there's a new payability that has been implemented with the buyers that we have for the nickel matte. That came from the nickel matte and Sorowako operation. The second point is actually on the new operational side. Bahodopi starting on July 1. We commenced operation and we already shipped some portion up until today, I think we already, up until the third quarter, we already ship until around 900,000 wet metric ton. I think when we speak today, it's already 1.5 probably, up until today, and we're still optimistic that up until the end of the year, we can close the whole quota of 2.2 million coming from Bahodopi. Just as a refresher for Bahodopi specifically, it's a good reflection of how competitive the market is when it comes to saprolite ore.
It yields good premium, and hopefully it's the same situation when it's approached to 2026. As a result, of course, revenue is higher because of the new payability, because of the increased production volume for nickel matte, and also the new additional volume of sales in saprolite coming from Morowali. We had an EGM back in September. Later on, I think our BOD one by one will try to have a good discussion with all of you in their respective directors. Because I think the spirit is actually to have a discussion on what are the key fundamental drivers. What are the key changes? Again, just to stress this out, it is an inflection point that it does not only require operational readiness, but later on, I think even [Non-English content] Heri will explain from a fundamental culture and also transformation point of view.
Just as an FOI, this is probably going to be the first year that from a three year rolling RKAB chief buddy, we came back to a one-year submission for the RKAB quota. We've submitted our 2026 plan. Later on, we will provide a bit of a guideline on the numbers that we submitted. For the 2026, we have the base for Sorowako already in place, so I think this is a matter of securing the potential sales, especially when it comes to the Bahodopi site, and later on, especially on the volume coming out of Pomalaa. Next. Yeah, I think this is just showing a bit and refresher that we had an EGM back in September. [Non-English content] Slamet at the time was joined and appointed back in September as our new Chief Strategy and Technical Officer.
And also, I think [Non-English content] Heri, even though it was before September, this is the first time that you guys met [Non-English content] Heri. I think it will be a good opportunity later on to talk about how the human capital and transformation side can enable the changes in PT Vale. Next. I think, without further ado, I would like to invite [Non-English content] Heri to start off. When it comes to changing the company, the business plan is one thing, but what is actually very important is to have that fundamental changes in place. It starts with culture and also it starts with how we see things and we plan things and approach things as well. I think [Non-English content] Heri will provide a bit of context on that.
Thank you, [Non-English content] Rizky. Good morning, everyone. Today, I would like to share why we are focusing also not only the business, but also how the culture, especially culture transformation, and why culture is a part of the important things that we have also to manage, because I think everyone knows that corporate culture is a driver foundation for the sustainable growth and how we are going forward, and also where we are now, and how we drive the internal situation to be connected with the external situation. Actually, Vale already has a purpose, or in some company, with purpose is a vision. We exist to improve life and also how it transforms the future, is something that not so easy to achieve or how to reach this vision or this purpose. To fulfill that purpose, we also have these values.
These five values is a part of how we are manage the internal and also to bridge with the external situation. We already have five values here. Those values will consist also or reflect with the how the behavior of the people in the company and how the attitude of the people in the company, how we interact each other within the employee in the company, because it will reflect also to the how we motivate people and how also we engage with the environment within the Vale stakeholder. Next. Go to the culture transformation here. Actually, we have the model and also we set up the model that from the purpose and also the vision and strategy, and we also have the aspiration also. Probably, three or six months ago, some of the people also already mentioned how the aspiration of the Vale itself.
To manage the culture transformation, we have to aware also that the external factor or external situation is something that we have to consider. Because now we are aware that the nickel price also pressure us and fast-moving technology and also the sustainability community expectation also getting higher. Next, you can ask how we manage the external with others. Slamet, Budi and Abu probably. Related to the culture transformation, we are focusing on how we manage the competitive advantage in the company that we have very comfortable people, agile people in the company, and also the engagement rate in Vale is quite high compared to the industry. We are talking about the strategic partnership with MIND ID.
This is one of the strong position for us because they already have some strategy which we can align with them because in the perspective of the holding, it can be also give us some advantages. In the culture itself, we have around seven, but probably not all of the activity here that we are focusing. But one thing is that we need to be a high-performance organization. Here we are focusing on how leadership management also manage the company overall and also how the performance management system is one of the tools that we can make sure or ensure all the KPI or the program or the project will be achieved or sometime.
Overall, we are sharpening some of the program, but I think later on we will share also if we need, we will give you some explanation related to how we sharpen some of the process related to the transformation. We already have the values. We already make a socialization, internal session someday. If all the value of behavior or attitude is already embedded in the people mind in PT Vale, then we are sure that going forward, we are talking about the sustainable growth is something that we can really or really easy for us to achieve that matters.
So far, that is all that we are how we are focusing on the culture transformation is a part of how we strengthen our foundation to deliver what we need to achieve in the future. Thank you. Is there any question or there is no question? Okay, that is all. Thank you, everyone. Next, Abu. Asril sorry.
Yeah.
Thank you.
Okay. Good morning, or good evening, the wonderful attendees from overseas. Let us go to the next slide, please. Okay. It is always our ultimate purposes actually, to be focusing on the health, safety, and environmentals in all of our operation and projects. In the Q3 2025, that we can see also the improvement of our incident frequency rates compared with last quarters. This is involving about 13,000 workforces in the projects, plus in our operation, about 6,000, and the coming 2,000 because of we are doing now today, furnace rebuild starting last week. So those are also marked that our focus still remain the same while delivering a good performance in the operation in the project, but also we are not forgetting to make sure that our route is also being managed very well. So the fatalities year-to-date also is zero.
Again, this is also demonstrating our very strong cultures in safety management in the ground. This is being achieved not only because of we're doing things normally, but we have very strong leadership cultures in term of safety management. We have hundreds of our leaders is always, every day, doing their own leadership in the field and talking with the people in the grounds. As well as that, we are also implementing a high risk control, which is we have over 200 critical risks in the operation and also in the projects that we're doing verifications, regular audit, et cetera, to make sure that all of those are being controlled very well. Those are actually demonstrating that we are achieving a good trend on the production and projects acceleration as well.
But at the same time also that we are showing a tremendous trend of safety improvement in the ground. Next slide. This is just to repeat again what [Non-English content] Rizky mentioned earlier, that despite that we have some issues in the first half of 2025, but we able to catch up in the quarter three and also last quarter, which is ongoing today. This is also still involving our furnace rebuild which started last week. We will be able to achieve 71,234 by the end of the year for our net production from Sorowako. Again, this is not easy task, but I can say that the team in the ground that can do things very well, and then for sure are guaranteed that we can achieve our net production from Sorowako this year. Thank you.
Good morning. Good evening, everyone.
Continuous from [audio distortion] about transformation cultures that we run right now, sustainability is one of the key. Just to let to you to share what we have done in these couple weeks, I just back from Conference of the Parties at Belem, Brazil. There was a concern there about the extractive industry like us, one of the major energy consumptions, how we can put ourself in this challenging decarbonization program. But we keep remain to be consistent that on 2030, that we about 33% that we are going to reduce the decarbonization program. As you see here, the parameters showing good trends, especially for the greenhouse emissions that all the operation is still below from the target. And then we keep remain the next couple years that we are going to improve this chart as well as the SO2 intensity as well.
Although the activities in operations there happening now, like furnace rebuild, is not impact to these parameters. Another things that we can share to you is our strong performance in the sustainability is where the Sustainalytics performance continues very good trend, which is this is now is the lowest Sustainalytics score we have is about 23.7 from previously. Yes, we have experienced that jumps a little bit before, 29, but what we learn as organizations is how we can do things in transparent as well as expose what we have. As you know that there was an incident a couple of months ago, but we learn from that one. Mature organization can do well and then have ability to respond with that kind of incident. That's why this is reflections our resilience in these businesses, especially in the extractive industry.
As you see here, there are some awards that go to PT VI. The latest one is the Subroto Award. As you know, Subroto Award is the highest award from the MEMR, Ministry of Energy and Mineral Resources, that handed directly from the Mr. Minister of the MEMR, that acknowledge of PT VI's socials and performance are there. So, at the end of my presentations, I would like to impose that PT VI is keep remain for the consistent of the one of the extractive nickel smelters for the lowest carbon. Then we seeking the technologies to support this, as well as you see, that reflection is our Sustainalytics score, which is now is the lowest what we have, 23rd. The next flagship initiative is we are going to do the IRMA 50 audit.
I can bring you a summary update that now the team is keep working to close around 70% of our critical requirements of IRMA. Now the team is on the field. We already do the announcement publicly that we are going to do this audit of IRMA 50, and then perhaps next year, our target is to continuing close the gaps and then also get the certificate. But now we are going to, as you see there, critical requirement improvements now is being done. By December this year, we do the stage two audit. So now we can understand where is our position officially, and then we get some mirroring from the independence party, including independent certification body, to see our position for this IRMA 50 audit. So perhaps everything can going well, because this is very strategic for us with this commodity situations right now.
This is put PT VI keep in the become one of the partner of choice in this sustainability nickel producers. Thank you. Yeah. Continue. Wow. I said that again. Oh, you're good. Thank you. So I just recall back again when I sitting at the same events last year, late last year, that at that time that we just presenting means that we're going to have this in the following year, which is this year, right? So those are actually the promise that we made last year. But today, we're going to show you what was happened in the last one year, 12 months, in three sites, Sorowako, Pomalaa, and Bahodopi. So, next. So this is just to remind all of us. Next slide. For three growth agenda for PT Vale in three provinces. Okay? Let me start from Sorowako.
So in Sorowako, we're going to build HPAL plant with our partner Huayou, which is 60 kiloton in Ni. Okay, let me go direct to this actually. So this is in Sorowako. Last year we just thinking about starting permitting, and also talking about partners and start preparation things. But today we can see some progresses in mining and also in some pieces of progress in our GV side. In the right side, you can see those in the film video from the top there. You see those are stockpiles. Today we are stockpiling. It's about 2 million of limonite, which is used to be being disposed part of the waste of Sorowako operations today. Now we are actually stockpiling those, actually prepare for next year, pumping it down to our HPAL in Malili, which is 60 kilometers away on that.
I strongly believe that we are able to make this in mining for sure today, which is investment about $200 million. On the left side, some facilities being prepared also for our Sorowako Limonite GVs, which is down in Malili, but FPP in Sorowako. FPP, Sorowako, and we are going to build 60-kilometer slurry pipeline down to the HPAL plant. Those are being prepared today. We are almost finishing off the land acquisitions. The critical permit also is in finalizing for the HPAL site down in Malili. We are going to have a first cuts of land preparations for FPP December this year for HPAL plant. This investment is about $1.6 billion-$1.7 billion in total with Huayou, our partner from China today. Again, with the aim to finish off the HPAL first maker completion by Q2 2027. Q2 2027 for Malili HPAL plant.
This is really recent recording which is 24th of November, which is last three days ago. Okay, next. Where is it? Pomalaa? Pomalaa. Okay, this is Pomalaa. On the right side. This is in mining preparations, but I can also disclose that we are already finishing off selling the Pomalaa ore this year. It is about 298,000 based on the RKAB that we have today, when preparation for RKAB for 2026. These are all facilities that you can see, main haul roads, sediment ponds. In Pomalaa, again, this is live, which is three days ago that we took. The progress is there, and we are preparing of mining operation starting 1st of January 2026. We already have first cut mining last month with our mine surface company. They are preparing the stripping today and ready to go by 1st of January subject to RKAB.
This is in mining site. Even though the progress we can say only 56%, but the same with Pomalaa and Bahodopi site, we are able to finish off infrastructures, at the same time also in mining. They are selling the ore through our facilities. On the left side, earlier that you can see that the two autoclaves just arrive in Pomalaa today. It is about landed in the jetty today. It is probably today, late afternoon. Two autoclaves from China just arrived in Pomalaa. Two are going to arrive in December, and the last one by January 2026. This is live. I can see 20s. This is overpass of provinces crossing to the jetty to the top side there, and the left side go down into East Papua. This is autoclave. This has just arrived. This is something live today.
Two autoclaves just arrived in the port. You can see this is the jetty and the ports that have been built by our partners, by Huayou. You see, this is in the plant site here, the sulfuric acid plant, the foundation of our autoclaves, the power plant also there. Most of the foundation has been completed. We can see. I can say that in the last year that we say that seeing is believing. This is really live that we can see the progress really fast in the ground today. With the target to complete this by the Q3 2026, first mechanical completions. We actually strongly believe that we can deliver this. At the same time, I can say we are preparing in mining.
By mining, we are able to deliver the ore by January for sure, but the plan is going to be finished off by Q3. This is like we can see living areas there, which is now the workers already live there. Again, in total of workforce today in all of EGPs, 13,000. It is going to increase up to 20,000 people for three projects in Bahodopi, Pomalaa here, and also Sorowako. You can see live there, overpass. It used to be that we had an issue on the Antam site. This is Antam, they have already been finished off, so they are crossing Antam and they go direct to the jetty. Next, let us go to Bahodopi. Just to remind again, in Bahodopi, we have plant in Bahodopi and also plants in Sambalagi, which is about 30 to 40 nautical miles away.
We have to barge our ore from mining site to Sambalagi. In the right side, this is really live document that I took this from CCTV, actually. We can see mining face there. We say this is Majesty and Royal Pit. On those direction, those are actually the jetty site. It is about 7km from the pit, go to the port of Morowali. We can show also that live jetty there. We have four, five actually, jetty that barges can land there, which is probably if the video can be shown, that there are four barges there now is being loaded for us to deliver 2.2 billion based on the RKAB that we have today.
We almost finished off the facilities and all infrastructure for phase one, and then we move into phase two to expand for us to be able to deliver the limonite to Sambalagi next year, again, subject to RKAB. This is the mining site. I can say it is ready to go. Not ready to go, it is under operation for sure today for Bahodopi site. In the left side, this is in Sambalagi. This is on the 4th of October. You can see some of the constructions in the water purification. Each pile is being leveling, and also sulfuric acid also that probably in the next month. Those are actually, you see the trucks, is going actually to loading the ore into the four barges at the same time. Our facility is ready for the first one of ore mining. You can see those actually.
The buyer, as Rizky said, that we are pushing to deliver because the price is really good for ore today. The left side, as I said, actually, those are in Sambalagi. This is also work in progress. It is really fast, I can say. I have been there actually last week, and the plans to finish off this by Q4 2026 in Sambalagi. There are some videos that show in the November. Here is still October. This is in the port side, actually down below, and those are actually in the plant site. It is about 1,000 hectares belong to RT, but 400 hectares for BNSI plan. This is November. You can see there, actually, by October or July, those are actually living facilities, not there yet, but within three months, they will be able to build it.
This you can see also by November, one month difference, this is sulfuric acid areas, actually. You can see they are actually fast, really fast in building those actually. Therefore, from my side, we actually strongly believe that we will be able to deliver all of those three according to the plan or earlier than the plan. Okay? Thank you. Those are actually the updates from group projects. I think from my personal, that we invite all of you to come to site to see physically what being happening in the ground. Thank you.
Thank you for your explanations, [Non-English content] Asril. Now, coming back to [Non-English content] Rizky for financial updates.
Okay. Let us wait a bit until the slide shows up. I think I do not want to talk too much about third quarter financials, right? I think most of you are already aware. I think essentially, third quarter is actually a reflection of the previous efforts. You could see that in the third quarter, in terms of profit, in terms of EBITDA generation, especially when we see it on a quarter-to-quarter basis, it showed quite a significant hike. I think the reason being is because starting 1st of July, again, we shipped some portion already, coming from Bahodopi site. We have reflected a new average selling price for the nickel matte with 82%, effectively. We have increased the production of matte when we compare with the second quarter, which there was an incident at the time.
We believe that cash cost will continue to remain as one of the key focus area. We manage it to be below guideline. Actually, I think last year when we had this session, I provided a bit of a guideline of $9,500 for 2025. For third quarter year-to-date, it was being managed and kept at below $9,100. We could see that the impact is actually reflected into net profit level, especially, and also EBITDA. When we see from a year-to-date perspective, nine months, it is higher when we compare with last year's position, even though that if we try to reflect back at that time, LME nickel price was still higher. So I think it reflects an agility in the sense that despite market condition, despite some effect in 2025 from a cost perspective because of regulatory issuances, there was increase in royalty.
If I can just put it out there was an increase in cost for commodity input because of P40 implementation. However, we see that continuous discipline in cash cost and also a shift in mindset and business from a nickel matte focus to an additional volume, significant volume from our ore selling. It is actually reflected in the third quarter position. Cash and cash equivalent, I could say that we are still in a comfortable position of $500 million, and this is actually excluding restricted cash. So, we still have quite an ample amount of cash to work with. I would not say this is going to be a permanent position, especially when it comes to 2026 later on.
I will provide a bit of a guideline, which I think exciting in a sense that we are heavily expanding, and we can see that this is going to be the first year, 2026, PT Vale to be in that position. But it is going to be a productive debt. As we approach the new mines, we can see the full potential of PT Vale going forward. Just a bit of a focus on the cash cost side again. So I think for nickel matte, it is quite manageable, below $9,100. For Bahodopi, you could see here that we actually can see quite a good cash cost. So $17-$20 of cash cost per ton, but this already include royalty. To bring you perspective, royalty probably at this point of time would take around $6-$7 per ton.
From a service contract perspective, from a mining perspective, you can deduct that number from this cash cost guidance. For Pomalaa, I think it is too preliminary for us to see this year's number as a guidance. One thing I can provide is that Pomalaa will come in a significantly higher volume. It will have a more strong resource base. So in a sense, when we translate that into a per ton of nickel, of cash cost, it is going to be more competitive, even when we compare it to Bahodopi. Next slide. Okay. So I think the main idea of this slide is actually to provide you guys with a bit of recap and also a bit of a guidance and highlight of what to expect to the closing of 2025.
Today, I think we are in the mid of November, so it is only one and a half months to go. So far what we are seeing, I think what we have been noticing, not only this year but I think starting from last year, nickel price continued to be in a pressured position. Production, there was a disruption, and then cost pressure from regulatory point of view as well, was reflected in the first half, especially. But I think it tested the resiliency of PT Vale. We answered that with optimism. We challenged the status quo. So payability increase. We tried to see it lens from an efficiency point of view, be it from a cash cost, be it from a CapEx point of view.
I think in the previous earnings call, we provided a bit of an update that from the previous FID for the three projects that we have, we accumulated around $700 million of cost avoidance. We reduced around $700 million- $800 million of CapEx. Hence, what is supposed to be in that position for us this year, we are looking at a leverage position to be sometime around probably Q2 in 2026. That is actually one of the reason why we are still having quite an ample room in cash, because we managed to reduce cash spend, especially on the project side of things. Pomalaa and Bahodopi ore sales realized for this year, I think it is a good number. It is a good starting point. Bahodopi is still ramping up. So $2.2 million from Bahodopi and then around $300,000, maybe $290,000 coming from Pomalaa.
In terms of savings and uplift, we try to continuously seek competitiveness across the board, be it from a procurement category, be it from how we do things on the ground to actually remain competitive, especially when it comes to cash costs. As a bit of a guidance and also as a bit of a highlight for 2025, we see that we are quite on track to deliver the production of nickel matte around 71,000 in nickel matte for 2025. Bahodopi and Pomalaa will continue to ramp up, and especially Pomalaa, we are trying to have January 2026 to be the first commercial date of Pomalaa. Nickel ore sales, we see that up until today, we are quite on track as well to deliver around 2.5 million wet metric ton of saprolite ore. The 290,000 coming from Pomalaa is already completed.
The only homework up until December is actually the 2.2 million from Bahodopi, which I think we are quite on track from a logistical point of view and from a contractual point of view. We are quite optimistic in this progress. Growth, I think, we managed to secure, the key catalyst. [Non-English content] Asril already mentioned virtually the progress on the ground, and I think it would be good if some of you or most of you can also come to the project, especially when it comes to next year. I think the last one, of course, profitability. We are seeing a higher profitability figure, especially when we compare to the last year position of 2024. I think next slide is actually talking about the market and also business development.
[Non-English content] Slamet will provide a bit of a context, but I think one of the most important point that [Non-English content] Slamet will try to elaborate is actually the long-term value of PT Vale. [Non-English content] Slamet is a veteran geologist, if I can say that. What we have on the ground, the whole 118,000 hectare of concessional area, it provides a lot of future value, and [Non-English content] Slamet will guide us through then. [Non-English content] Slamet.
Thanks, [Non-English content] Rizky. Good morning and good evening, everyone. A lot of slide has been presented to you, more with downstream process. It is a mining industry where we have upstream and downstream. Lucky that we have everything, both downstream and upstream. From downstream, a lot of target has been planned and designed to process the nickel ore by using various technology, both SBF and also HPAL. For the upstream, we need to ensure that the ore is available to supply. Without ore, without data or inventory of ore resource and reserve, all the downstream process is nothing. Vale is pioneering a next-generation exploration approach to unlock untapped mineral potential. I mean, it is in the future. We want to ensure that life of mine is enough to supply the ore to the industry at the downstream. We aim to increase 2.5x of the current level.
How to get this target achieved? By massive exploration, through drilling, geophysics survey, and all the instrument to collect the data as much as possible by increasing drilling spaces to increase the resource classification, in field drilling spaces to increase the reserve classification from probable to proven. Apart of that, we also targeted to discover new mineral resources that still in the greenfield, and it is need drilling with spaces greater than 50 by 50 meters. As [Non-English content] Asril mentioned, we have limonite sourceling. This limonite drilling have to be done and an inventory must be collected from our drilling data because previously we have limonite as a disposal that we need to optimize everything from the previous limonite, and then will be processed by using the new technology, HPAL.
How we do that, we allocated the exploration program from 2026 or next year until 2037 with more or less average 6,500 drill holes and supported by 50 to 65 drill rigs per annum. This is a various work program, including the research geoscience to support the drilling program. Next page, please. In terms of market outlook, we can see here that from the research report notes that persistent nickel still offers supply. It remains a challenge. It is until 2031 where oversupply still happens, and then supply continues to grow due to rising OESBF and also more HPAL pipelines to develop. OESBF itself will be a big disruptor in the future. It is because of the low energy and then it can absorb a lower grade of the nickel ore.
On the cost curve pressure at $15,000 ton nickel price, roughly 40% of global producers are facing negative cash flow. The current price is less than $15,000, and then roughly 70% of the global producers are facing negative cash flow. The implication for INCO, short-term price weakness may persist. It is given oversupply and also rising inventory. Cost pressure could lead to supply adjustment. Indonesia producers, including NPI matte operators, may face tighter ore supply. It is quite fortunate for us that we have ore compared to the IUP. We are IUPK. We are integrated industry from upstream to downstream. Rising input cost. It is with a tight ore supply, rising input costs, which could influence the margin. Overall, PT VI are positioned as low-cost producers, and with our new baseline provide relative resilience.
But mining sector dynamics and concerns around the existence of new government regulation, PP 28 of 2025, it is a warrant for close monitoring. I think that's Next slide, [Non-English content].
Thank you, [Non-English content] Slamet.
Okay. So I think this is going to be the last slide, and we try to allocate some time to have good discussion with all of you. Just a bit of a context, this is for 2026. I think [Non-English content] Slamet does provide a bit of an understanding of the industry. But more important, I think the key point is, despite the nickel price situation, despite the industry situation that we are in today and what we are seeing in the future, when it comes to the context of nickel, I think we're in one of the best, if not the best position to actually realize the value of nickel, right?
Nickel price, we see, of course, it's still going to be in the current situation for quite some time, especially in the short to medium term, which is not a bad thing, in the sense that how can we actually get the value? How we see this as an opportunity, right? When we talk about nickel pressure, it provides a lot of pressure in the intermediary side, but it actually provides a good opportunity when it comes to the ore selling side as well. And regulatory landscape, we see that of course there will be a full-year impact for 2026, but I think we already have some initiatives in place to manage that in a good position in the cash cost driven decision making as well. And production next year, we've covered a bit of electric furnace rebuild.
For next year, probably for nickel matte, it is not going to be 70,000. We have anticipated this. It is probably going to be hovering around 67,000 for next year, which I think is still a good number to work with, especially when we have around four to five months of absence in one of our furnaces. We believe that 67,000 of nickel and matte production would be a good number to work with for 2026. Project delivery, we can see that for the mining side of things, it will be live, all three of them. Bahodopi already started in July. We will see quite a significant volume in Bahodopi next year. Pomalaa will be starting in January, and we will have a full-year ramp-up for Pomalaa as well. A bit of a guidance, we have submitted our RKAB. We actually submitted quite a substantial amount for the RKAB.
But for a base case production volume next year, we are seeing around 20 million tons for a combination of Bahodopi and Pomalaa. Last but not least, I think funding requirements. We need to see it from an excitement point of view. Because when it comes to funding, it gives a signal that we are quite optimistic with the growth ahead, and we are actually boosting it. We are actually funding it externally, and the market is actually in a good position to fund that as well. I think if you have been following the debt side of things, debt market, it is a good market that we have today as well, with a good outlook going forward. It is quite exciting that even from a loan perspective, even from a funding perspective, it reflects the value of Vale. We are aiming to have a sustainability-linked loan for next year.
In parallel, as Budi mentioned before, with the IRMA 50 that we are trying to achieve in 2026. On top of that, we are trying to look for a sustainability-linked loan for our funding side as well. Probably next year, it is not going to be a substantial amount, given the ample cash balance that we still have today. Probably the maximum amount of loan that we will be drawing is around $350 million-$400 million. It is going to be a USD funding requirement as we speak. I think as a focus, of course, we remain focused on cost leadership. When we talk about costing side of things, especially on Sorowako, because of the tonnage that will be reduced, of course, it will translate into a slightly higher cash cost per ton.
But we believe that it will be hovering still within $9,500-$10,000 per ton of cash costs. For Bahodopi, I think we have provided a bit of the actual cash costs for 2025. The $17- $20, it includes royalty. When it comes to operational, we can reduce at current price of probably around $7-$8 per ton. That would be roughly the guidance for Bahodopi cash costs. For Pomalaa, I think since this is not yet operational, I would not provide a specific number. But again, just to emphasize, with a higher volume, with a higher potential nickel grade, it would be very competitive when we compare Pomalaa with Bahodopi. I think I would stop there and just to give you a bit of a hint that Pomalaa is actually going to be the significant volume that we have in 2026.
I think with all of that, we are quite optimistic that even on the project side of things, we will be on track. From one mine before, we will have three mines next year. From one smelter, probably all of the autoclave will arrive, and we will have the HPAL to be in mechanical completion. Our first HPAL, the 120,000 ton of nameplate capacity in Pomalaa to be ready in hopefully the third quarter or the fourth quarter of 2026. Then we will have the following HPALs to be live probably in 2027. I think just to hold a pause there. From one mine, we will have three mines. Possibly in 2027 we will have even our fourth mine because Sorowako Limonite, as [Non-English content] Asril mentioned, it already showed a good progress as well. From one mine to potentially four mines.
From one smelter potentially in the next three years, we will have four smelters with 70,000 ton of nickel matte roughly per year. Also in addition to that, we will have around 240,000 ton of nickel in MHP, which we will be looking at 30% of contribution throughout the board. Next slide. Okay. I think that is actually the last slide before we go into Q&A. I think I just want to thank you, all of you again for coming here. It shows that we are quite optimistic with what is going on ahead. We have tried to share this as frequent as possible to you in terms of progress. We can see that Vale is actually showing step-by-step progress. Last year, I think the last time we met, we were planning to open a site. Now we have a site, additional site.
We were planning to sell some portion of ore selling. We are actually going beyond what we expected before. I think despite the current situation of the industry that we have, history repeats. Commodity, it is a cycle. I think with what resource and reserve that we have with the cost leadership that we maintain and with the continuous focus in terms of spending and seeking where value is and how to actually deliver that, and maintaining, of course, the focus of sustainability in our practices will definitely be one of the competitive advantage of PT VI. We believe that we will still be relevant, if not even more relevant with the substantial volume going ahead, and focusing on delivering not only profit, but how to balance it with people and planet as well. Again, thank you. Thank you very much.
Thank you, [Non-English content] Rizky. Let us give applause to our management first. Okay. I think after this we will divide into the Q&A session. We will have three sessions. For each session, we will gather three questions from the floor and then also from online. Without due course, I think I need to invite if any one of you have any questions, please let us know, please. Okay. Please mention your name and your institution first.
Thank you, [Non-English content]. Thank you, PT Vale Indonesia management team for the comprehensive presentations. My name is Ilham from BNI Sekuritas. I think I have two questions for now. The first one is. Sorry. I think related to your explanations about the RKAB of 20 million tons productions from Bahodopi and Pomalaa mines for next years, is there any constraints for PT Vale Indonesia to achieve or to optimize that target? Maybe related to port capacity or tracking, et cetera, or should we expect any kind of additional CapEx for this area for next year? My second question is related to your costs. You mentioned that your cash costs are declining for the third quarter. Is there any more drivers going forward for the cash costs to decline further?
Could you give us some color related to your all-in sustaining costs, considering that I think the company is still spending in some area on the new minings as well as on the rebuilding of the Electric Furnace. So should we expect the all-in sustaining costs to still increasing for 2026? I think that's my questions. Thank you.
Okay. I think we better answer the question first, [Non-English content]. There are two questions. Number one is logistic constraints with regards to achieve production from Pomalaa RKAB, and then second one is about the cash cost, yeah.
Yeah. Okay. I think I'll try to answer the costing side of things that later the management can add. Ilham, the question is the first one for RKAB constraint. The 20 million is a base case for us. What we actually submit, and I think we wouldn't go actually to the exact number that we submit, but it's much more than that. 20 million is actually the base case that we, as a management, try to anticipate. When we talk about potential, especially when we talk about the full-year production ramp up, when we talk about the possibility from a logistical constraint as well, it is much higher than that.
The number that we submit is higher than 20 million, but we are saying that the base case for us, from a management point of view, as a base case, it's 20 million coming from both Bahodopi and Pomalaa. From a CapEx point of view, yes, there will be more CapEx, of course. Next year, we're looking around probably $7 million of CapEx next year. Majority of it still on the mining development side of things for both Pomalaa and also Bahodopi. We see that in terms of CapEx drawdown, it shouldn't be a problem because what we see so far as a trend is actually in an accelerated trend. The second question, I think it's on cash cost for the fourth quarter. I think for the third quarter, we're seeing a really good number, below $9,100 year-to-date position.
In Q4, unfortunately, there's a furnace rebuild that's already started since last week. When we talk in a relative term, especially when it comes to per ton basis with the reduction in tonnage, it will be in a slightly higher when we compare with the third quarter. As a guidance, again, we're quite optimistic that it will be well below $9,500. What we're seeing probably as a guidance, it's going to be hovering around $9,250- $9,500 as a year-to-date position for a nickel cash cost. For all-in sustaining costs, yes. We're looking at sustaining costs to be on track as well. What we see is for sustaining CapEx for the year, we will probably spend around $155 million of sustaining CapEx.
With that, I believe all in C1 plus sustaining costs, we will still be below $12,000, probably $11,800 or $11,900, sorry. In terms of that, $150 million amount, it already captures the furnace rebuild, some portion of the furnace rebuild, and there will be an additional portion, of course, in next year for furnace rebuild, since we have around four to five months for 2026. Maybe [Non-English content] Asril, some additional comments.
Okay. Thank you. If you can go to the last pictures, I'm going to show that in Pomalaa. Basically, for talking about the logistics side, relative to the availabilities of our infrastructures, to delivering the RKAB 2026. This gives an example. This is the JT that there are, I don't know how to show that. There are mines.
Jetty wharf that is available for us there for us to be able to deliver. Here we go. So there will be six here, landing barges, and also there will be three here, so nine. So if you are going to deliver let us say 7 million, 6 million ton of ore deliver out coming from Pomalaa, we are going to use this. It is being agreed to our partners to use this, include some facilities of stockpiling somewhere here. And in the future, this is going to be like a stockpile for ore delivery in Borneo Ports, actually. Those are for supply, for example. For limonite, actually, because the plant is basically close to the mining, so we only deliver the ore to FPP area, which is basically in the mining site.
So actually, the plan for full production is about 21 million of limonite delivered to the plant from mining site, which is very close by. So logistic-wise, that I mentioned earlier, that we are basically preparing today, which is part of the CapEx in mining as well. In Bahodopi, the same, I show you also the jetty. Those are actually jetty capacities about 5 million- 6 million. And then we are actually progressing to expand to cover the limonite delivery to Sambalagi, which is work in progress as well. Our plans to finish off two or three additional barges, sorry, jetty, is in the second half of next year. So in total of RKAB that we are planning this year is basically we are preparing at the same time also logistic include the road overpass and also the jetties development today, which is part of the CapEx. Okay. Thank you.
Thank you, [Non-English content] Muhammad Asril, [Non-English content] Rizky. Hope that is clear enough, yeah, Ilham, yeah, from BNI Sekuritas. Okay. Anyone else from the other table? Same table? Okay. [Non-English content], go ahead.
Hi, [Non-English content]. This is Sintia from Batavia. So maybe I want to ask about, there is the new Government Regulation No. 28 of 2025 which states that a moratorium for MHP. And there has been also talks about other commodities being taxed for export. So, are you mitigating the risk of that happening to MHP? And if that happens, do you consider a plan to build a converter from MHP to sulfate? And have you done due diligence on what sort of CapEx are we looking at? What sort of increase in profitability are we looking at from selling MHP to nickel sulfate? Yeah, that is my question. Thank you.
What do you think?
Yeah. I've already anticipated this kind of question actually before this session. Yeah. I think it's quite new, right? [audio distortion] is quite new. There are several viewpoints, right, to see this. I think the first one, it shows seriousness of the government in terms of protection of industry protection in that sense. It shows that it still remain as a focus also from the government to look at those specific commodities specifically. I think for us at Vale Indonesia, we see this as an opportunity, right? When we talk about the 240,000 nameplate capacity, we already have that IUA in place. When the moratorium is in place, it's actually a downside protection, right?
Because then we know that there will be a much more strict and much more serious attention for new issuance just going forward. For us, we're in a fortunate position that we already have that license in place. What we see in that sense is it's going to provide a downside protection in terms of the investment that we have on the downstream side of things. When it comes to future pipelines outside of the three, it will be an ongoing discussion that we will have with the government. We've noticed that there are some potential areas where I think we can do that if we do it in industrial park. I think there's an opening as well if there is a further downstream to some product, if I'm not mistaken.
I think it will provide an impact for the pipeline beyond what we have for the three HPALs. I think as [Non-English content] Slamet mentioned, we still have a lot of resources that we can still, on the ground, we can still optimize in terms of value and also in terms of potential investment. I think it's still early, and we're trying to understand also what would, in terms of structure, can be workable. Again, for the existing pipeline, it's more or less we see it as a downside protection for our existing HPAL pipeline. For the tax export, yeah. We are still trying to study, to be honest, with the tax export. What we see, of course, it's focused more on the gold as a commodity. I think that is quite clear in the narratives outside.
We see a potential of impact if that is actually being implemented. But in our view, probably there will need to be further iteration. I think what's good is that something in terms of a royalty discussion, in terms of export rate discussion, in terms of previously the GMT case discussion, there's a discussion in place, right? As of today, I can safely say that it's still quite early. There's no significant development that can be
seen as a guideline. But I'm quite optimistic in the sense that I don't think the government is trying to kill the industry. Billions of dollars from CapEx, we're talking about billions of dollars of CapEx here. So I believe there will be a good series of discussion going forward, and we will keep you up to date.
Yeah. Hi, I'm Marissa from Soros. Maybe, regarding the reserve and resource update, I understand that in the slide there is 2.5 x potential upgrade on the resource and reserve. Can you share the timeline? When will be the announcement for the resource and reserve update? Will it be yearly or quarterly or something like that? Thank you, [Non-English content].
Thank you for the question. Yeah, actually I forgot to mention about that, our resource and reserve, we report it annually based on the resource and reserve validation done by our CPI, and then this is annually reported to the government as well. And this will be included in the RKAB. Yeah.
Thank you.
No. We have a drilling program that will be incorporated into the exploration report. An exploration report will be included into the RKAB and also to the government there. Yeah. So everything from the initial work program, drilling program, assay result and everything, full data will be input into the RKAB as one document, including the resource and reserve the last validation data. Yeah. Tanamalia resource. Actually, it is part of the F, you see that to unlock the untapped mineral potential, that is including Tanamalia. Tanamalia is in the. We aim to finish the [audio distortion] two program in end of 2027, if I'm not mistaken. Yeah.
Okay. Thank you, [Non-English content] Slamet. I think before we go to the other questions from the floor, we have one question coming from online. Let me read it for you. Can you give us an outlook of nickel market going forward considering global HPAL capacity is expected to reach 1 million ton per year? So yeah, outlook on nickel market going forward considering HPAL global. Yeah. Okay, [Non-English content] Gi, please. Question coming from Vito, Sean.
Okay. Thank you for the question. So, I think when we see outlook, we're talking about several variables, right? The first one is actually the potential pipeline, installed capacity. The second one, we talk about pricing. And I think the third, we're talking about payability. So I think that three big components would be important for us to understand. In terms of pipeline, I think as I mentioned before, it's a downside protection that we actually have PP28, the presidential decree 28, because it safeguard us from additional surprises, if I can say that, of additional pipelines going forward. So, in that sense, from a supply point of view, what previously has been quite substantial, now it's much more limited in that sense.
When we take pipeline into consideration, I think there have been many rumors saying that from installed capacity of 300,000, we will be around 1 million or 900,000 by 2030. That is announced pipeline. I do not have the exact numbers, but when we do analysis, further analysis later on, one of the important point is to understand that declared pipeline, whether they already have an IUI in place, right? That is the first question that needs to be questioned. The second one is to ask about the status of integrated or non-integrated processing plant. Because it creates a different landscape, a substantially different landscape when it is integrated and not integrated as well. I think it is no secret that I think sulfur is also a condition that we are watching out today, right? Which is one of the main commodity input for HPAL.
If you are a non-integrated smelter, it is going to be a tough position to actually produce a profit. I think, again, when we see potential pipeline, non-integrated player and non-IUI obtained player would be requiring additional analysis of future pipelines. Second one, we are talking about pricing. I think as we speak today pricing is still below $15,000.
To be honest, we are not expecting a significantly higher number than that as well. We are quite there in terms of what we expect in terms of pricing. What is surprising is actually when we talk about payability. I think previously when we talk about nickel class one, it would be from a matte perspective, be it from nickel in MHP as a product. It is quite a different landscape when we compare even with early 2025. Even today, I think on a spot basis, we can see MHP trading at 91% of payability.
Same thing that goes to nickel in matte. Around 90% - 91% on a spot basis, right? On the long-term view, of course, that is not going to be a permanent situation. But I think that despite having a decline in price, there is always a balancing factor. I think I see optimism in the sense that payability is actually in a good position as we speak today. What we see also compiled, I think it is in a good credit, especially post-DRC. So economics, what I am saying is economics in terms of the nickel in MHP and HPAL as a project is still in a good position as we speak. So going forward, we have a downside protection and also we have a balancing act in terms of the pricing side of things and also economic returns of the project.
Thank you, [Non-English content] Rizky. Okay. Anyone else? Any other questions from the floor? Oh, okay. Benny.
Hello, [Non-English content]. Thank you for the opportunity to ask a question. I am Benny from JP Morgan. Maybe my one question is, in one of the slides it was mentioned that OESBF is gaining a bit of traction. Can you maybe just help me understand what is the unit economics of OESBF? Why it is more efficient than RKEF technology-wise, cost-wise, and is this actually a negative pressure because it could lower the global cash costs in the next 5 - 10 years?
Okay. Thank you, [Non-English content] Benny. OESBF, so far it is not a big, great pipeline for us. It is still something that we are trying to study as well. But I think it has been showing good traction in the sense that it unlocks value. I would say, of course, from a cash cost perspective, definitely it is going to be lower. To what extent it is going to be lower, it needs proving ground.
To be honest, some of the live ones, they are still ramping up. It shows good number, but we are still trying to see whether it is going to be a sustainable number to work with. But what we see as a potential actually is the feed that it requires. If we talk about our plant, especially with the RKEF one, and we are talking about a feed of average 1.7% of nickel grade content, right?
Probably in Antam site, 1.8%, 1.9% probably, right? Those technology requires higher feed. I think as an industry, one of the key point for us is actually not to adapt the mine, but actually adapt the technology. It is always the mine. OESBF is actually requiring only a feed of 1.5%. When we talk about potential value, if this is actually proven to be running at a sustainable level, this is going to be a potential uplift on top of the existing economic unit that we have throughout all of the mines, right? Sorowako 1.7%, we put it in 1.5%, we are not using it. Right? We call it today transition zone. That is why it is called a transition zone, because we are not using it elsewhere.
Even when we talk about Pomalaa and Bahodopi, the existing kind of grade and the base scenario, it is much, much higher than that. But if we actually have that potential demand with a good technology in place, then that would be an additional economic unit, right? What I am saying is, and later maybe [Non-English content] Slamet can add a bit, is that if this supposed to be technology is proven, then definitely it will provide additional economic unit. The logic behind it from a cash cost perspective is it will require less fuel usage because as the name goes, right? Oxygen side-blow furnace. We use the reheat process, so we will reduce the requirement for the fuel usage. Hence the lower cost and also the lower emission as well. But I think we are still waiting and see.
We're in quite an advanced discussion, I think, with one of the technology provider. We can see it in an additional capacity. We can see it from a potential replacement capacity. But I think, again, it unlocks the long-term value of the mines because it requires lower grade of feed.
Thank you, [Non-English content] Rizky. Okay. Final two questions. Anyone? Oh, okay.
[Non-English content], I want to ask about our confidence to get our RKAB being approved. There has been news articles about the quotas cut for next year, the National RKAB. What do we say to the government when our downstream projects are only starting in Q4 2026, and we want to start selling ore by Q1 2026, right? How do we convince government to approve all of our RKABs when maybe the government can count that for your Q4 starting, smelters you don't need as much nickel ore. That's my main question. Thank you.
Thank you. I think this very relevant question for now. Since end of this year, every mining company is looking for the approved RKAB. Just to let you know, the government now start to implement new approach for the RKAB approval process, which is using the online system. They call this Mineral One. This is like a linkage between the feasibility studies and also the production plan. Every company that submitted their RKAB, it must have the alignment between the feasibility study as well as the environmental license. Another one that critical permits, like forestry permit, also part of that. In this situation, I can explain that PT VI has already made all of everything.
So, as a guarantee, baselines for the RKAB approval was there, which is all the feasibility study are aligned with what we submitted to the government, as well as all the licensing already there, including the forestry as well as the environment boundary as well. In the past, those license is not correlated to the RKAB. You just submit RKAB, getting the approval and then done. But now through this online system, it's like linked. It's very strict from the prerequisite permits like forestry, environment, et cetera, and as well as the feasibility studies capacity, and then you can declare and then request the RKAB. Again, the position of PT VI from those three blocks, we are in the right track. We have the submission, all the plans to the RKAB, and then we got the evaluations now in the middle of the evaluation from the evaluators.
We didn't see any obstacle there. It's all about administrative confirmations like our production plan as well as the market later on. Because as [Non-English content] Rizky mentions about that our 2036 outlook production is also there from those three blocks. So we will wait within this December, as per forecast by the system that can be obtained all the approval for the RKAB.
Yeah. Follow-up question.
Yeah.
Sorry, if I can follow up. Maybe you've known that some of your peers are also looking at asking for volume growth in RKAB next year, and they're asking for a sizable growth in volumes. So when the government is saying, although through news articles, they're saying that they want to cut the national RKAB, how can we be sure that we're not the ones being cut? And then second is, maybe you can comment on, in 2025, the RKAB of the other players are at potential to be cut next year because maybe you've seen some players on the ground, they don't comply to all the licenses. Maybe you can speak generally about that.
Yeah.
Yeah.
Yeah. Basically, in the feasibility studies and then also the feasibility study PT VI already mentions about the plan on each year is not only within 2026 but also next five to seven years. So, which is that FS is already approved, basically, we just deliver what the numbers or the plan that has been approved in the FS. We got the confidence with that government about this one because, as you know, for PT VI, changing from three years become one year is no matter for us because our planning team is already there. It just matters to provide the numbers. But as I said, generally speaking, if you see in our feasibility study on each block, there were stages of the production already there. So now what we are doing now is to get the annual process or previously three years for the productions to be executed.
And now, because it is all impact, right? It is not only for the license but also for the CapEx and also from the logistic. [Non-English content] Asril, as they mentioned there, Pomalaa and Bahodopi are ready to align with the production plan, which is stated in the FS. So we are quite confident on that one, even though some I heard that, okay, government try to balance the commodities in order to control, et cetera. But that government side to secure, these critical minerals capacities. Yeah.
Yeah. And maybe just to add. When it comes to submission of RKAB, definitely the spirit is to see what is actually the usage of the permit. I think, let us not forget, our commitment in the IUP is actually to develop three mines. And comes along with that is actually the potential investment that is required. We actually have a regular reporting of CapEx development, which in aggregate, I think in the previous slides that we have submitted to you, it is talking about around $7.5 billion - $9 billion in aggregate of investment. Not only on the mine, but also on the HPAL side of things. When we submit the RKAB, it is always on the back of that. It is always on the back of that commitment. It is always on the purpose of delivering the potential value, especially downstream.
So the quota that we ask, especially when it comes to the respective blocks going forward, the new blocks, which is Pomalaa and also Bahodopi. First things first, is actually to monetize the limonite. So the limonite needs to be linked with the production uplift and the ramp-up that we are anticipating from the HPAL that is going to be online. And the second point, the unit economy of the mine is actually consisting of both getting the limonite and the saprolite.
So I think contingent upon the success of the limonite will come the saprolite that we will sell domestically. In terms, of course, the ultimate volume that will be approved, it will be subject to review. But I think again, in the spirit of having a quasi-government ownership as well. We have MIND ID as one of our shareholders. We have Vale committing to the investments as well.
I think we're quite optimistic in terms of our position in regards and respective to the market.
Okay. Thank you, [Non-English content] Rizky. Last chance for a question? Okay. Hang on a sec.
Good afternoon, the management. My name is Melvin from Stockbit. I have two questions. First, do you have any comment regarding the saprolite ore premium in 2026, considering the additional volume supply from the miners? Second, do you have also any estimate or range regarding the max ore premium price that will be paid from the smelter on the company, considering the nickel price drops below $15,000? Thank you.
That is a very relevant question around the premium for next year, [Non-English content] Rizky.
Yeah. Because I am the one selling it, so I think I am the one supposed to be answering that. When we talk about the production that we are still selling from Bahodopi, we are talking about a premium of $25.6 for our products. That is on FOB basis. When we talk about the market in general, yeah, slightly below, but it is around that number. FOB basis. When we talk about 2026, it depends, of course, on quota. Again, it depends on quota. But I think I just want to provide a bit of an understanding of how the market is actually reacting to those variables. First of all, of course, supply. But the second point is also about LME. I think you touched upon a bit, the condition of the declining LME that we have today. It comes back to where the premium is actually coming from.
Premium is actually coming from the gap from the willingness and the capacity to pay against the LME price now. If LME is declining, but there is no substantial change in input commodity price, let us say, there is no substantial change in the effectiveness and the efficiency of the processing plant. It means the willingness and the capacity to pay is still quite relatively the same, right? It is still at this level. But with a declining price and with a restriction in quota, then everyone is trying to get that same product, hence competition is in place. When you ask the ceiling, the ceiling is still the capacity to pay of the smelter to remain profitable. If LME, which I think we all know that HPM is a lagging function of LME, HPM.
With the declining nickel price, as long as there is no fundamental change, then declining LME will result in a higher premium. What I am saying is, I am not seeing premium going to be a continuous level at that level. It depends on those factors. But I think those should be how we look at potential premium. What would be justified as a good number to start with is actually the willingness and the capacity to pay off the buyers of this ore, which are the smelters in Indonesia. For 2026, in our view, there will still be a premium. We couldn't provide any guidance in terms of how many the premium is going to be. But those are the factors that we need to consider as we approach 2026. And I think with the business plan that we have today, I think it is a good shift.
It is quite fortunate, I would say, and lucky at the same time, that the progression of PT Vale is actually going to anticipate that excitement. Yeah, I think that is for 2026.
Thank you, [Non-English content] Rizky. I think that is all of the end of the Q&A session. I would like to give this to moderator. [Non-English content] Lidia, [Non-English content].
All right. Thank you, [Non-English content] Andaru, for leading the Q&A session, and thank you for our beauty members, to give us the insightful presentation today. With the end of Q&A session today, I think our INCO years and analyst meeting today has come to an end. I would like to thank you for your time and participation, also continued support on INCO. We will see you again in the next announcement. Thank you all.