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RUSAL to run plant or return it to Ukraine-minister

Thursday, Nov 06, 2008
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KIEV, Nov 4 (Reuters) - Russian aluminium giant RUSAL should return unprofitable aluminium producer Zaporizhsky Aluminiyevy Kombinat (ZALK) to Ukraine's state sector if it is unable to run the plant, a top government official said on Tuesday. United Company RUSAL this week said it had suspended production at the site, Ukraine's sole aluminium maker, as lower metal prices and rising power prices made the plant unprofitable. "If the owners prove incapable, they must simply return the enterprise to the state," Ukraine's Fuel and Energy Minister Yuri Prodan told reporters. He said the owners had suspended production because they failed to reach a level of "excess profit". The world's largest aluminium and alumina producer said the cost of electricity at the plant had jumped in the past two years and now accounted for about 48 percent of output costs. The factory produces 113,000 tonnes of primary aluminium and 265,000 tonnes of alumina a year. The first stage of the suspension of ZALK, in central Ukraine, is likely to result in about 130 workers being laid off. RUSAL employs about 100,000 people globally. ZALK was sold in 2004.

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