(Yicai Global) Dec. 3 -- Shares of China's Chengtun Mining surged after the mining company said it will construct a USD350 million plant in Indonesia to increase its output of electric vehicle battery raw materials.

Chengtun's stock price [SHA: 600711] jumped as much as 7.6 percent to CNY12.17 (USD1.90) intraday. The shares are up by more than a fifth this year.

The copper and gold miner will form a joint venture with Singapore-registered Extension Investment to construct the nickel ore processing facility in Indonesia Weda Bay Industrial Park, the Xiamen-based firm said in a statement yesterday.

The company already has similar business in the same industrial park. In September 2020, a factory that can churn out 34,000 tons of nickel equivalent kicked off production. Chengtun has a nearly 36 percent stake in the project.

The new factory makes use of Indonesia's nickel ore resources and the listed company's technological capabilities, it said yesterday.

The capacity of the upcoming nickel matte plant will be 40,000 tons of nickel equivalent per year after its construction period of 18 months. Nickel matte can be turned into nickel sulfate which is a core material of battery cathode materials.

Chengtun's unit will have 70 percent of the JV's equity and the Singaporean partner will have the remainder. Sales of the product will be allocated in the same ratio.

Editor: Emmi Laine, Xiao Yi