Indian JV plans Indonesian aluminium smelter

INDIA’S NATIONAL ALUMINIUM producer and exporter, NALCO, has entered into an agreement with Rak Minerals & Metals Investment (RMMI), based in the United Arab Emirates, to build a $2.5b aluminium smelter and a supporting $1.5b power plant in South Sumatra, Indonesia. The smelter will produce 500,000 t/y of aluminium from 1m t of Indian alumina using electricity generated by the 1250 MW coal-fired power plant. NALCO has a 76% share in the deal and RMMI has a 24% share. The project is expected to be completed in 2013. RMMI will build the necessary port and rail facilities and provide 5m t of low sulphur thermal coal to meet the energy needs of the smelter. NALCO will build the smelter and power station. “The smelter requires a lot of electricity and we have a lot of energy in India […] but still we find that it makes sense to put the power plant near coal mining here in Indonesia,” says NALCO’s director B. L. Bagra. NALCO is a publicly listed company and the Indian government holds a majority stake. It has an estimated turnover of $1.5 billion and has been mining bauxite and refining aluminium for 25 years. The company has ambitious growth plans after being conferred Navratna status by the Indian government which entitles it to more independent managerial powers and commercial autonomy. The company has further plans for new smelters and power stations in India and Iran. RMMI is looking to expand its current infrastructure in Indonesia. It is planning involvement in other smelting and metal-based fabrication industries in South Sumatra including an industrial park at Tanjung Api-Api for which the local government has committed to providing sufficient land and to fast tracking the approval and licensing process. ---tcetoday.com