The Ministry of Energy and Mineral Resources has expressed criticism over LG Energy Solution's decision to withdraw from an electric vehicle (EV) battery manufacturing project in Indonesia, valued at IDR 142 trillion (US$ 8.45 billion).

In late 2020, LG Energy Solution entered into an agreement with the Government to participate in the Indonesia Grand Package - a programme intended to develop the full EV battery supply chain in the country.

However, the company announced on 21st April, 2025 that it would no longer continue with the project, citing market conditions and the prevailing investment climate.

Tri Winarno, Director General of Minerals and Coal at the ministry, stated that LG Energy Solution had repeatedly failed to meet agreed investment timelines, resulting in delays to the overall project.

"Are they [LG] serious about investing here? If not, that is acceptable. It indicates there may have been no firm intention from the outset," he said during a press conference in Jakarta.

Tri also stated that the company's withdrawal would not affect the national objective of developing Indonesia's nickel downstream industry, especially in battery production.

"There will be other investors prepared to step in," he said.

In its official statement, LG Energy Solution indicated that it would continue to seek other collaborative opportunities with the Indonesian Government, particularly in relation to the HLI Green Power project.

This joint venture, established with Hyundai Motor Group, launched Indonesia's first battery cell production facility in 2023, with an annual capacity of 10 gigawatt hours. Plans to expand this capacity are currently under consideration.

The wider initiative, referred to as "Titan," involved cooperation between state-owned Indonesia Battery Corporation (IBC) and a South Korean consortium made up of LG Energy Solution and Hyundai Motor Group subsidiaries. The programme was intended to create five joint ventures covering the full supply chain, including mining, raw material processing, component production, and final battery assembly.

The Titan project aimed to reach an annual production capacity of 30 gigawatt hours.

Final battery assembly plants were scheduled for completion by the second quarter of 2024, while mining and component manufacturing sites were expected to be operational by the second half of 2026.

In February, IBC - whose shareholders include state-owned enterprises MIND ID, PLN, Pertamina, and Antam - stated that its partnership with the LG-led consortium remained in the feasibility study phase. At that time, there was no mention of a potential termination of the project.

However, signs of LG Energy Solution's potential withdrawal had emerged earlier. On 2nd February 2023, former MIND ID President Director Hendi Prio Santoso said that the future of the project was "uncertain," as negotiations between the parties had stalled.

Subsequently, LG Energy Solution assigned its consortium partner, Zhejiang Huayou Cobalt, to lead further negotiations, citing various shortcomings within the project.

According to Hendi, Antam had reported that LG's status was still unclear, although LG had encouraged Huayou to continue discussions.

"Antam informed us that LG's position remains unresolved, but LG is urging its consortium partner, Huayou [Zhejiang Huayou Cobalt], to proceed with negotiations," Hendi told House Commission VII, which oversees energy and mineral resources, on 6 February 2023.

LG's formal withdrawal from the project was announced on 17th April by Dilo Seno Widagdo, Director of Portfolio and Business Development at MIND ID.

Following this development, Dilo confirmed that MIND ID would continue with the Dragon Project, an EV battery ecosystem initiative in partnership with Ningbo Contemporary Brunp Lygend (CBL), a subsidiary of Contemporary Amperex Technology (CATL).

"The EV battery ecosystem involving LG has been cancelled," Dilo stated.