This report includes minor amendments to clarify the waste-generation comparison and the regulatory classification of HPAL tailings. It replaces the version published on 20 July 2026.”
Key Takeaways
- Without urgent intervention, tailings from nickel HPALs in Indonesia will hit 1.4 billion tonnes by 2035 — enough to cover the whole of Jakarta 1 metre deep. Annual HPAL tailings generation will soon exceed the volume of waste produced by the rest of the Indonesian mining sector combined.
- HPAL Tailings are stored near industrial parks rather than at remote mine sites. If poorly managed, they will cause fatalities, destruction to river and marine ecosystems and the livelihoods of local communities. They can also contain high levels of chromium, including a cancer-causing form
- ESI supports reducing overall production volumes by linking project development to environmental credibility and developing regulations specifically targeted at increasing standards for HPAL tailings.
Executive Summary
Over the past six years, eight new nickel High Pressure Acid Leach (‘HPAL’) plants have been brought online in Indonesia with a further seven under construction and more than a dozen in the planning stages. In many ways, this is a significant achievement. Following a series of failed projects in the mid-2000s, the technology was widely considered to be too expensive or technically challenging. However, starting with Harita’s joint venture with Lygend in Obi Island, HPAL has made a remarkable comeback driving down unit-costs at industrial parks by utilising low-grade limonite ore and producing a valuable Mixed Hydroxide Precipitate (‘MHP’) product.
This expansion comes with a substantial waste burden. On average, HPAL generates 118 tonnes of tailings for every tonne of nickel produced. This is more than twice the amount of waste generated by RKEF smelting, at approximately 46 tonnes per tonne of nickel. If all Indonesian nickel HPAL projects under construction and in planning stages ramp-up on similar schedules to those already in operation, the associated production would produce nearly 2 billion tonnes of tailings over the next ten years. Using more conservative production forecasts, still results in tailings of nearly 1.4 billion tonnes by 2035.
The sheer volume of HPAL tailings would be difficult for any country to manage let alone Indonesia with its high population density, wet tropical climate and frequent earthquakes. Many storage facilities are built and operated along way below international standards with high moisture content of the tailings and inadequate drainage being the key issues.
There have already been three serious failures and four deaths, including a widely reported landslide at Morowali in 2025. What are now occasional headlines could become routine news as the number of tailings facilities increases from six today to around ninety by 2035. The tailings contain between 1 to 1.5 percent chromium, including a carcinogenic, water-soluble form that can affect nearby communities and coastal ecosystems. Under Indonesian law, nickel HPAL tailings are classified as hazardous and toxic waste (limbah bahan berbahaya dan beracun, or LB3).
Current HPAL tailings storage facilities generally use dry stacking. In simple terms, the tailings are dewatered, pressed and stacked, rather than stored as slurry behind engineered retaining walls in conventional tailings dams. Dry stacking is not inherently unsafe. The central problem is that the sheer scale of the ramp-up and that HPAL dry-stack facilities in Indonesia are not subject to the tailored, stringent design-review and safety requirements that apply to tailings dams. This regulatory gap has contributed to unsafe practices and multiple failures. At the same time, HPAL plants are now being built at twice the speed of earlier plants and waste storage facilities are often rushed or incomplete when the plant is commisioned.
To avoid an environmental catastrophe, Indonesia must urgently take action on HPAL tailings.
First, it must slow the pace of project development by implementing a review process. Second, it must adopt a consequence-based governance framework, drawn from international standards such as GISTM [1]. This framework sets requirements based on the harm a facility would cause if it failed, rather than the storage method it uses, removing the loophole that lets dry stacking escape scrutiny. Third, it must set technical criteria for dry stacking. The criteria should cover what keeps a dry stack stable under Indonesian conditions, including moisture, drainage, foundation, zonation, slope and stack height.
These reforms can be housed within the existing permitting system and used to set a firm condition: that new HPAL refineries should not commission until their storage is built to standard, verified and able to hold at least five years of throughput. This makes the storage facility, not the processing plant, the reference for the pace of project development.
If implemented, higher environmental hurdles would mean that new HPAL projects take longer to reach production. Some marginal projects could become less attractive and may ultimately be cancelled. The resulting slower pace of development and project cancellations could reduce cumulative tailings generation by 2035 by around 183-796 million tonnes. This would make the overall scale of the problem more manageable and improve the ability to enforce safe storage and handling practices.
Regulation would also increase the real cost of compliant storage, improving the commercial case for processes such as iron recovery. If deployed at scale across the industry, iron recovery could reduce the total volume of tailings sent to storage facilities by 289 million tonnes, or 21% of cumulative tailings generated by 2035. However, bridging the gap between current proof-of-concept work and commercial-scale deployment will require government support.
Indonesia must act now. Early implementation will be far less painful than suffering the full environmental consequences of poor tailings management. Once constructed, redesigning storage facilities and rehandling waste will be prohibitively expensive, opportunities to integrate recycling will be lost and some companies may play-for-time and wind-up rather than incur the costs of the environmental clean-up.
[1] The Global Industry Standard on Tailings Management (GISTM), released in 2020 by ICMM, UNEP, and PRI, sets requirements for the design, operation, monitoring, and closure of tailings facilities, including dry stack storage
This paper is part of a series of analyses on Indonesia’s downstream mineral and industrial development. The Energy Shift Institute is publishing the series to highlight key developments, challenges and opportunities in the sector.
Reza Rahmaditio is an Analyst at the Energy Shift Institute, specialising in sustainability in the mining sector. He previously led the Critical Minerals portfolio at World Resources Institute Indonesia and worked as a consultant for the Indonesian government on decarbonisation and conservation policy.
Ian Hiscock is a Principal of the Energy Shift Institute. Ian is a mineral economist with a global profile. He started his career in London, spending more than 16 years working for global companies, banks and governments.
The Energy Shift Institute is an independent non-profit energy finance think-tank driving context, clarity and credibility for Asia’s energy transition pathways.