New Delhi, Jan. 24: Aluminium giant NALCO's plan to construct a Rs 16,000 crore greenfield smelter in Middle East has run into serious trouble with Qatar, Oman and UAE refusing to assure gas supply for the project.
"In course of our negotiations with these countries, we found they were not willing to commit anything on gas supply, in the absence of which we may not be able to proceed with our plans there," NALCO Chairman and Managing Director C R Pradhan said here.
The company has virtually stopped negotiations with Qatar, although talks were still on with Oman and UAE for the proposed five lakh tonne per year smelter, he said.
Earlier, after conducting a pre-feasibility survey, NALCO's technical consultant Engineers India Limited had shortlisted Ras Laffan (Qatar), Salalah (Oman) and Fujairah (UAE) as the possible locations for the smelter, Pradhan said.
"The aim of constructing a smelter in Middle East was to take advantage of cheap gas to reduce the energy cost of the plant and effectively utilise surplus alumina of 1.2 million tonnes for our second phase expansion (in Orissa)," he said.
Of the total outlay for the smelter, certain sum would be spent on building a 1,100 MW gas-fired power plant for captive use of the smelter, Pradhan said.
The public sector company has earmarked Rs five crore in 2007-08 for preparing detailed feasibility report and other associated work before deciding to invest money there.
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