Rusal Plans 50% Global Production Expansion, Focus on Energy

Oct. 18 -- United Co. Rusal, the world's largest aluminum producer, plans to enlarge its capacity by about 50 percent in six years as it expands worldwide and develops an energy business. Production capacity will rise to as much as 6 million metric tons by 2013, from about 4 million tons now, the Moscow-based company said in a statement on its Web site today. New plants will be built in Asia and South America, Rusal said. Oleg Deripaska and Viktor Vekselberg, the billionaire owners of Rusal, want the company to become mostly self-sufficient in electricity generation by 2013. Power accounts for a third of aluminum production costs. The company this month announced a $7 billion aluminum and nuclear power project in Russia. "The new projects we have initiated open the next stage of the company's development as an energy and metals corporation," Chief Executive Officer Alexander Bulygin said in the statement. Rusal invested $2.2 billion in the first nine months of the year. The company today posted a 5 percent gain in aluminum production in the first nine months, to 3.1 million tons. It opened two electrolytic cell complexes at its Khakas smelter and a fourth one is being started now, Rusal said. Annual capacity will be 300,000 tons and that should be reached by November. Its Irkutsk smelter is also being expanded, with two new production lines scheduled to be ready by November. They will add 170,000 tons of capacity. Alumina output rose 5.7 percent to 8.45 million tons in the first nine months because of greater supply from the Nikolaevsky refinery in Ukraine and the acquisition of a 56.2 percent stake in Euroallumina. The company is targeting a 50 percent gain in alumina output by 2013, to 17 million tons. Aluminum Smelter Rusal is already working with state-controlled OAO RusHydro to complete a Soviet-era dam and build the country's biggest hydropower plant, to provide a nearby aluminum smelter with power. Rusal and RusHydro have equal stakes in the dam and smelter, which are set to start operating by about 2012. The company also agreed in May with ZAO Atomstroyexport, the state nuclear-plant builder, to build a 600,000-ton smelter and nuclear reactor near Vladivostok, in the country's Far East.