In an announcement to the Australian Securities Exchange, Antam said the JV ownership is envisioned as 50:50 between Antam and BHP.

"This move is in line with Antam's strategy to move into higher technology and downstream metals processing activities," Antam said.

"This strategic alliance with BHP is also expected to mitigate the cost and risk of developing mineral deposits."

Antam said the agreement was subject to approval from BHP's board, which is expected to make a decision on the matter within the next month.

News of the JV follows a heads of agreement signed between the two companies in February last year to investigate development of pyrometallurgical and hydrometallurgical processing routes for the Buli deposit and other ore bodies on Halmahera Island.

Antam and partner Shenzhen Zhongjin Lingnan Nonfemet are currently in a takeover tussle with Bumi Resources for zinc play Herald Resources.

Tango Mining, the takeover vehicle owned by Indonesia's Antam and China's Zhongjin, earlier this week increased its offer from the previous two-tier cash bid of $2.60-2.65 per share to $2.80 per share, matching Bumi's bid.

Shares in Antam fell 2c to $2.98, while BHP was at $45.09 in morning trade, down 23c.