Bosnia aluminium plant sell-off deadline extended

SARAJEVO, Aug 27 (Reuters) - Bosnia's Muslim-Croat federation government on Thursday extended for a year a deadline for the sell-off of an 88 percent stake in the country's sole aluminium smelter, Aluminij Mostar. The head of the region's privatisation agency Enes Ganic said the government made the extension, the fourth since 2007, to give more time to the commission tasked with the privatisation to resolve some outstanding issues. The sale of Aluminij Mostar to the best bidder, the consortium led by Swiss-based commodities trader Glencore International AG, has been stalled for over two years over high electricity prices and environmental and ownership issues. The government has also complained about incomplete registration of the company, following the agreement with the management in 2006 giving each party a 44 percent stake in the smelter. The remaining 12 percent stake belongs to the Croatian TLM company. "The privatisation commission will invite the best bidder to clarify all details of its offer within 30 days," Ganic told a news conference. Glencore requested the government should provide it with cheap electricity. The government insisted the consortium should take over the responsibility for settling a silt depot. Aluminij Mostar, Bosnia's largest exporter, had said it could restore full production in the autumn if the metal's price recovery continues, and is well positioned to survive the economic slowdown. The smelter cut output by a quarter this year due to the global economic downturn and high electricity prices. It produced 123,000 tonnes of metal in 2008 after it refurbished an anode plant last September. Because of the cuts it will likely have an output of about 95,000 tonnes at the end of this year. The company said its annual production could reach 300,000 tonnes if plans to build a plant for aluminium waste recycling and new electrolysis went ahead. But those plans depended on completing the privatisation of the company and finding a power supplier that would offer favourable electricity prices.