AluNews - June 2007

Alcoa legal team compiling list of Alcan merger disposals to be presented to DoJ, sources say

Financial Times, UK - June 2 2007 00:07 | Last updated: June 2 2007 00:07

By Yana Morris and Nadia Damouni in New York

Alcoa’s legal teams have compiled a list of disposals that will be proposed to the DoJ as a voluntary remedy in its merger with Alcan, said a source close to the situation. "We are potentially looking at a multi-billion dollar disposal program," the source said.

The source was unclear, however, as to what order these assets will be proposed to the DoJ, but the idea, he said, is to do it in slots. He added that both Alcoa’s bankers and lawyers are trying to persuade Alcan that this merger could work, and the two companies do not have to lose half of their refinery business in the process of getting the deal done.

A draft list for disposals being considered, but which the source said could get larger, includes Alcan’s Ravenswood rolling complex in West Virginia and the North America alumina refineries. The latter, the source said, is one major area of concern that would go through a rigorous review. The Ravenswood refinery, on the other hand, would "take care of a lot of problems", the source said, and will be one of the first assets to be presented to the DoJ, if it gets to that point.

Other assets in North America that could be divested, according to the source and an industry banker, include Alcan’s aluminum bumper plant in Novi, Michigan, and the aerospace sheets division. Both the source and industry banker agreed that in Europe, Alcan’s French refinery and Alcoa’s Spanish refineries will have to be reviewed. In addition, a number of other specialty sheets, alumina trihydrate and aerospace sheets will be added to the list.

The source said a refinery in Quebec might also have to be divested, although a second source close to the deal said he did not expect that to be necessary. Two industry bankers also questioned whether a sale of a Quebec refinery would be feasible. The second banker said that any buyer for Alcan is not going to be able to divest assets in Quebec and satisfy a continuity agreement that the aluminum producer has in place with the Provincial government. The banker argued that the agreement is critical to Alcan’s value. "So everything in Quebec stays there," he said.

On 17 May, Alcoa acknowledged the importance of the issue, announcing that it reviewed Alcan’s continuity agreement with the Government of Quebec which identifies the requirements that Alcoa must meet regarding Alcan’s future operations in the Province in order to maintain certain of Alcan’s hydroelectric and water rights.

The first source close to the deal also said that Alcoa Point Comfort in Texas would have to be divested, but the first industry banker disagreed, again questioning the purpose. "That’s a bit of a question mark," he said. The banker noted that he did not expect any further assets to be sold in North America.

The transaction is subject to review by antitrust authorities in various jurisdictions including the US, Canada, the European Union, Australia and Brazil. It also requires foreign investment clearance in Canada, France and Australia.

Although Alcoa is targeting to complete the transaction by the end of 2007, the first industry banker speculated that the timetable will keep getting pushed back.

When asked about a realistic timeframe in gaining all the clearances, the first industry banker said approximately six to eight months. The second industry banker agreed, adding that the first step is gaining antitrust clearances, which could easily take half a year, and then on top of that, local Canadian clearances. "There are not only approvals at the federal level, but also on the provincial level. There are approvals that are needed in Quebec, so there is obviously a lot of time," the second industry banker said.

With reference to prospective buyers for the divested parts, a third industry banker said the downstream assets would be of interest to private equity suitors. He commented that there is an abundance of liquidity among financial buyers and provided the example in which Apollo last year purchased the former Noranda Aluminum assets from Canadian nickel miner Falconbridge following its merger with Xstrata.

The second industry banker agreed with this type of buyer, adding that PEs would not only be interested in rolling up the downstream assets but in being sector players in general. "I think if [the assets] were put up for sale, there would be scores of private equity that would have an interest," he said.

Most recently, Alcan reached an agreement to sell its Vlissingen smelter in the Netherlands to UK private equity firm Klesch & Co.

Additional reporting by Claudia Montoto

China's aluminum product export lifts domestic aluminum production and consumption

Interfax.cn (subscription), China June 1, 2007

Shanghai. June 1. INTERFAX-CHINA - The boom in China's aluminum exports is driving an increase in domestic aluminum production and consumption, industry insiders said at the China International Nonferrous Metals Market Conference 2007, held in Hong Kong Wednesday.

China is set to produce 12.4 million tons of primary aluminum this year, up 32 percent from last year, while capacity is set to reach 15.7 million tons, according to a prediction by Wang Feihong, a senior analyst with Beijing Antaike Information Co. Ltd., a leading consultancy affiliated with the China Nonferrous Metals Industry Association.

China's primary aluminum output reached 9.4 million tons in 2006, rising 20.4 percent from 2005 and soaring 117.5 percent from 2002.

China produced 8.15 million tons of aluminum products in 2006, making the country the world's largest aluminum fabricator. China was also the world's largest exporter of aluminum products last year, exporting 1.24 million tons of aluminum products.

"China's primary aluminum consumption was mainly invigorated by aluminum product exports, aluminum consumption for expanding aluminum plants, and its use as a substitute for other metals in downstream industries," Wang said.

Actual consumption stood at 25.08 million tons in the first quarter this year, climbing 45.3 percent from the same period last year, according to Antaike.

The construction of a 100,000-ton aluminum production line normally requires 10,000 tons of aluminum for building electrolytic cells.

Wang predicts that China's primary aluminum consumption will increase to 11.75 million tons this year, rising 35.5 percent from last year.

Following China's policy to increase the export tax on primary aluminum from 5 percent to 15 percent on Nov. 1, 2006, domestic aluminum capacity has rapidly shifted to aluminum processing capacity, which has seen the output of mainly low-level and semi-finished aluminum products, vice director of the China Nonferrous Metals Industry Association, Wen Xianjun, said.

"However, China remains a net importer of high-level aluminum products. In 2006, China's net imports of high-precision aluminum strip amounted to 223,000 tons," he said. The average price of imported aluminum products in 2006 was $944 higher than the export price, according to Wen.

The dramatic growth in semi-finished aluminum product exports has prompted the government to consider reducing the value-added tax rebate (VAT) on aluminum products, and a policy is expected to be released during the second half of the year.

China exported 605,522 tons of aluminum products in the first four months of this year, up 95.6 percent from the same period last year.

"The government intends to reduce low-level aluminum product exports, and guide the industry towards higher value-added products," he said.

However, Wen believes that domestic consumption and the export of aluminum products will maintain its growth momentum for some time after the policy takes effect, supported by a growing global economy.

The production of aluminum plate, strip and foil will exceed 3 million tons this year, and the production of extruded aluminum products will climb to 4.51 million, Wen predicted.

China's aluminum products are mainly used in power grids, construction, transportation and electric appliance industries.

Downstream consumption of aluminum plate, strip and foil, and aluminum extruded products makes up more than 60 percent of domestic aluminum consumption.

China's aluminum fabricating capacity will grow 51 percent from 15.54 million tons in 2006, to 23.45 million tons in 2010, according to an Antaike prediction.

CNMIA's Wen commented that the growth rate in primary aluminum consumption will remain high until 2010, due to the rapid development of China's aluminum fabricating sector. Aluminum prices are directly connected to aluminum product growth, he said.

The use of scrap aluminum in aluminum product fabrication is still rather rare in China, due to restraints on the import of scrap aluminum, and a lack of aluminum recycling regulations, Wen pointed out.

"We predict that the average spot price of primary aluminum in the domestic market will be between RMB 19,500 ($2,549.12) and RMB 20,000 per ton ($2,614.58) this year, while aluminum futures prices in Shanghai will remain on average at RMB 19,000 ($2,483.85) per ton, supported by strong consumption this year," Antaike's Wang added.

Chinese metal company Chalco seeks Australia, South America projects

MarketWatch Jun 1, 2007

By Elisabeth Behrmann

SYDNEY (MarketWatch) -- Chinalco, the parent company of Aluminum Corporation of China Ltd. (ACH : aluminum corp china or Chalco, the world's second largest producer of alumina, is planning to diversify into copper, lead and zinc in Australia and South America, a company official said this week.

"Chalco is operating on three fronts in Australia, the Aurukun project, discussions with the government to build an aluminum smelter and expansion into other non-ferrous metals," Chalco'ssenior representative in Australia Wenfu Wang told Dow Jones Newswires.

Chalco is driving Chinalco's overseas expansion strategy, acting as the its international arm, listed in Hong Kong and New York. Chinalco is Chalco's major shareholder

Chalco has earmarked CNY19 billion ($2.5 billion) this year for mainly alumina and aluminum expansion, up from a capital expenditure of CNY9.3 billion last year.

Chalco's interest in Australia so far has been limited to the proposed US$2.4 billion Aurukun bauxite and alumina refinery development in Northern Queesnland.

The company cleared a significant hurdle last week when it signed a land use agreement with indigenous landowners. Alumina is a key raw material for aluminum production.

"It's very early stage but Chinalco has a committed strategy and is looking at primarily copper but also lead and zinc. Chinalco is considering development projects of a medium size that will likely be developed as a joint venture with a local partner," Wang said.

Discussions with Queensland's government to build a US$1.6 billion smelter are focusing on power generation, Wang said. "We're trying to invite Chinese power generation investors and a project manager will inspect the possible deal in June," he added.

Chinalco is already China's biggest aluminum producer, targeting an output of 2.7 million metric tons for 2007. It also has some 200,000 tons of annual copper and 100,000 tons of copper products output in China.

Bigger Chinese Presence In Global M&A Likely

Chinalco has previously said it is seeking to expand into copper mines and rare metals within China as well as in neighboring Asian countries.

Three years ago Chalco signed a joint venture agreement to build an aluminum smelter in Northern Brazil with Companhia Vale do Rio Doce (RIO), but the project has remained at initial feasibility study stage so far.

China's desire to insulate itself against growing raw material shortages has prompted the country to make large-scale investments in Africa, including a number of small takeovers.

Elsewhere, China's involvement in international resources operations has focused more on taking smaller equity stakes in existing companies to engineer off-take agreements.

Larger-scale M&A activity involving Chinese mining or other commodity companies has so far been unsuccessful, such as the failed bid for U.S. oil company Unocal or Canadian nickel-copper miner Noranda, which later merged with Falconbridge.

However, analysts expect China to renew efforts to gain a larger stake in the global mining sector.

For now Chincalo is focusing on preliminary evaluation work and assessment of investment possibilities, Wang said, with no schedule or an estimate for the scale of investment yet.

Following the recent US$27 billion take over bid by U.S' Alcoa for fellow aluminum producer Alcan Inc. (AL), there was speculation that Chalco, BHP Billiton Ltd. (BHP.AU) or Rio Tinto Ltd. (RIO.AU) could make counter bids.

-Edited by Denny Kurien

-Contact: 201-938-5400

India's Rain Calcining to Buy U.S. Company for $595 Million

Bloomberg -June 2

By Ashok Bhattacharjee

India's Rain Calcining Ltd., which makes raw materials used in the production of aluminum dioxide, has agreed to buy closely held CII Carbon LLC for $595 million.

The acquisition, routed through Rain Calcining's unit Rain/CII Holdings Inc., is expected to be completed this month, the Hyderabad, south India-based company said today in an e- mailed statement.

Citigroup Inc. and ICICI Bank Ltd. will help raise the funds for the acquisition, which Rain Calcining said will help it reduce raw material and finished-product distribution costs.

To contact the reporter on this story: Ashok Bhattacharjee in New Delhi at ashokb@bloomberg.net .

Australia's Alumina expects aluminum demand ramp-up

MarketWatch - Jun 3, 2007

SYDNEY (Dow Jones)--Australia's Alumina Ltd. (AWC.AU) said Monday it expects growth in world demand for aluminum to double by 2020, providing a significant opportunity for its AWAC joint venture with Alcoa Inc. to expand capacity.

"When we look forward, we expect that global growth in consumption of aluminum will double by 2020. Much of that will come from emerging economies, particularly China," Alumina Chief Executive John Marlay told CNBC Asia cable television.

"And in that scenario, the AWAC joint venture has quite significant opportunities to expand capacity to supply this significant growth in global consumption."

Marlay also said a joint government and business report recommending the introduction of a carbon trading system is far reaching and sensible.

The recommendation that Australia should be in a position to implement a domestic emissions trading scheme by 2011 is "quite far reaching."

"It clearly does demonstrate a signal that CO2 and particularly other greenhouse gas emissions will need to be priced, and it will have an impact for all of us, both consumer and industry alike," Marlay told CNBC.

Marlay, who was on the task group that put together the report handed down to the government last week, said the scheme would be a "cap and trade scheme."

"And our recommendation is that work should start immediately," he said.

The proposed regime would allow Australia to link in with other emissions trading schemes as they emerge around the world.

"It will have an impact, it will cost more for energy, it will potentially have an economic impact and so therefore, all those issues need to be treated very seriously," he said.

"And I suspect that any Australian government will treat these issues quite seriously."

-By Rebecca Thurlow, Dow Jones Newswires; 61-2-8235-2959; rebecca.thurlow@dowjones.com

-Edited by Paul Godby

(END) Dow Jones Newswires

David J. Kjos Named Vice President for Century Aluminum's Iceland Operations

Market Wire (press release) -Jun 05, 2007 09:00 ET

MONTEREY, CA--(Marketwire - June 5, 2007) - Century Aluminum Company (NASDAQ: CENX) today announced that David J. Kjos has been named vice president operations - Iceland, with direct responsibility for the company's Nordural facility in Grundartangi, Iceland.

Kjos most recently served as vice president and general manager for Cygnus, Inc., a leading manufacturer of aerospace sheet metal and machined products. In 2003, he was named by the United Development Company to lead the development of a new primary aluminum smelter in the State of Qatar. He later rose to the position of chief executive officer of the United Development Company and remained in this position until 2005. Prior to joining United Development, Mr. Kjos held a number of senior operating positions with Kaiser Aluminum & Chemical Corporation from 1983 to 2002 in the chemical, alumina, primary aluminum and international business units.

Mr. Kjos holds a Bachelor of Science degree in Chemical Engineering from the University of Idaho.

"We are happy welcome David to Century and our Nordural facility," said president and chief executive officer Logan Kruger. "David has extensive experience in all of the life-cycle phases of a smelter -- from planning, through construction and operations. We feel he is an excellent fit for our growing businesses in Iceland."

Century Aluminum Company owns primary aluminum capacity in the United States and Iceland, as well as an ownership interest in alumina and bauxite assets in the United States and Jamaica. Century's corporate offices are located in Monterey, California.

Contacts:

Mike Dildine (media), 831-642-9364 Shelly Lair (investors) , 831-642-9357

Gunmen kidnap Russians in Nigeria

Turkish Daily News (subscription), Turkey 4-Jun-2007

Gunmen kidnapped six Russian workers of an aluminum-smelting plant in Nigeria's lawless southern oil-producing region yesterday, company officials said. The gunmen blew up the Russians' homes with dynamite before taking them away, said the general manager of the plant in southern Akwa Ibom state, Felix Nxong.

Aluar to complete US$800mn expansion in coming wks - Argentina

Business News Americas, Chile - Tuesday, June 5, 2007 15:27 (GMT -0400)

Argentine aluminum producer Aluar (Buenos Aires: ALUA) will start operations in the coming weeks on the US$800mn first stage of an expansion project at its Puerto Madryn plant in Chubut province.

The project aims to increase Aluar's production capacity from 280,000t/y to 400,000t/y and includes incorporating 144 electrolytic cells, a company official told BNamericas.

"To be able to expand capacity and produce more aluminum, we have to produce more anodes," the official said, adding that when expansion works began in 2005, Aluar had two anode baking furnaces.

"Now to be able to get the cells working, we need a new furnace since there is no capacity to produce more anodes," the official said.

Anodes are made with carbonaceous material that conducts energy and allows for an electrolytic response within the cells.

The expansion project also looks at building an alumina silo, expanding the foundry sectors and the milling area, updating the anode rod area, and building the third anode baking furnace, the official said.

Aluar is Argentina's only primary aluminum producer. In 2006, it exported 155,000t - almost 55% - of its output from a total 280,000t produced.

"And once the expansion is in action, we will surely be able to export 85% of our production," the official said.

Aluar is controlled by the Madanez Quintanilla family.

By Harvey Beltrán, Business News Americas

Hydro plant closing looms

Times Herald-Record June 05, 2007

Ellenville — The 260 Hydro Aluminum employees losing their jobs as the plant closes this month have a decent chance of landing new jobs, according to labor experts.

"Most will likely find employment at comparable wages at other manufacturing facilities, maybe not in Ulster County, but certainly in surrounding counties," said Johny Nelson, a labor market analyst in the White Plains office of the state Department of Labor.

Unemployment in the Kingston area came in at 3.4 percent in April, the most recent figure available, Nelson said. That is the lowest it has been since April 2001. Only seven counties of the 62 counties in the state had a lower unemployment rate. Dutchess County stood at 3.3 percent, Orange at 3.7 percent, and Sullivan at 4.8 percent. Albany was 3.4 percent and Westchester and Rockland at 3.1 percent.

The Kingston region also sported the highest private sector growth rate, 2.4 percent, in the state between April 2006 and April 2007, Nelson said.

In March, Hydro announced its plans to close its Ellenville extrusion plant. Efforts to sell the plant had failed. The Norwegian-based company will continue to run its local aluminum casthouse, with about 50 workers, officials have said.

The plant has been a mainstay of the local economy. Many of the employees have worked there 10-20 years and some more than 40. Hydro's closure follows the loss of Imperial Schrade, which shut its doors in 2005. Hundreds of workers lost jobs at Schrade and some of them are going through the experience again with Hydro.

Congo to diversify mining into iron ore, bauxite

Reuters South Africa, South Africa Tue 5 Jun 2007, 6:10 GMT

WINDHOEK (Reuters) - Congo aims to not only revive its traditional copper sector, but diversify by exploiting potentially huge iron ore and bauxite deposits, Mining Minister Martin Kabwelulu said on Monday.

"Diversification of production is a key strategy," he told a base metals conference in Namibia.

The Democratic Republic of Congo was once one of the world's biggest copper and cobalt producers, but output slumped during years of debilitating civil wars.

Only in the last few years have international investors streamed back to the mineral-rich nation as increasing stability and last year's successful elections boosted confidence.

"The government of the DRC wants to start a strategy towards new metals, such as iron ore, chromium, nickel, and aluminium," Kabwelulu said.

The country has deposits of bauxite, the raw material used for producing alumina and aluminium, in the west of the country near Inga, which has good access to the Atlantic coast, he said.

Probable reserves of alumina are estimated at 1 billion tonnes with of 39 percent average metal content, he said.

"To benefit from these deposits, the DRC needs to build smelters for aluminium and also a deep sea port," Kabwelulu added, giving no other details.

Iron ore is found in the northeast of the country, with estimated reserves of 4 billion tonnes with average metal content of 60 percent, he said.

Work was still underway on the extent of nickel and chromium reserves in the country.

As part of the country's mining strategy, Congo has decided to develop along with its neighbours four main regional "corridors" for transport of mining products and developing intergrated mining projects, Kabwelulu said.

Base metal ore deposits have been recently discovered in border regions with some of Congo's nine neighbouring countries. "Common exploitation projects are obviously to be designed," he added.

Congo has also forged a partnership with South Africa's state Mintek research institute to help establish research centres in the DRC.

© Reuters 2007.

Russia considers US$1 billion project in Viet Nam

Vietnam Economic Times, Vietnam - 07/06/2007

Rusal is considering an investment of US$1 billion in mining and processing bauxite in Viet Nam.

A leading Russian aluminum producer, Rusal, is considering an investment of US$1 billion in mining and processing bauxite in Viet Nam.

The project will help strengthen economic ties with Viet Nam, of which investment remains a weak point, Igor Khovaev, Minister-Counselor of the Russian Embassy was quoted by Quan Doi Nhan Dan (People's Army) daily as saying.

Russia will not stop at investment in Viet Nam's bauxite reserves, Khovaev said, as the country also looks to building power plants and developing the aluminum industry in the Central Highlands, which is rich in Bauxite ores.

According to the minister-counselor, investment in Viet Nam was top of the agenda for his country: "In the modern trade trend, without investment there are no big results. The Russian embassy is actively working with companies and conglomerates to boost investment into the Southeast Asian economy," said the Russian diplomat.

Viet Nam and Russia have been equal trade partners in recent import-export revenues, which stood at US$200 million in the first five months of 2007.

Khovaev also voiced the Russian Government’s expectation that consultation rounds with Viet Nam on Russia’s WTO membership would wrap up soon as a result of mutual understanding between the strategic partners.

"Consultations are what leaders from the two countries have agreed upon instead of negotiations on Russia’s WTO membership. These consultation rounds play a significant role in solving technical issues in economic and trade relations between the two countries. As a strategic partner, Viet Nam would fully understand what Russia is interested in," said Khovaev.

He concluded by saying that once both countries have joined the World Trade Organisation, their economic relations will usher in a new chapter.

Source: Vietnam Agency

Nigerian leader in charge of search for Russian hostages - diplomat

RIA Novosti, Russia - 06/ 06/ 2007

MOSCOW, June 6 (RIA Novosti) - A Russian Foreign Ministry spokesman said Wednesday that Nigeria's president was overseeing efforts to release six Russian nationals abducted in the African state.

The Russians, who work for the Aluminum Smelter Company of Nigeria (ALSCON), controlled by Russian aluminum giant RUSAL, were abducted by gunmen who broke into their residential premises in the southeastern town of Ikot Abasi Sunday, killing their Nigerian driver.

"Nigerian President Umaru Yar'Adua and Vice President Goodluck Jonathan have assumed control of search and release efforts," Mikhail Kamynin said.

The official said the Russian Embassy in the country maintained permanent contacts with Nigerian Foreign Ministry chiefs, the national security service and local authorities.

None of the militant groups active in the country has so far claimed responsibility for the abduction or put forward demands, Russia's Foreign Ministry said earlier. But the employees are widely believed to have been abducted for ransom.

Nigeria's ambassador to Russia was summoned Monday to the Foreign Ministry over the abduction.

Militants fighting against the Nigerian government for greater autonomy in the oil-rich Niger Delta have intensified their attacks lately on industry facilities that are largely run by Western companies.

About 40 people, mostly employees of oil companies, have been abducted and released in the country since January 2006. They were mainly nationals of the United States, the United Kingdom, Germany, Turkey and the Philippines.

A Belarusian woman who worked as a senior manager with a local branch of the British services company Compass Group, was kidnapped May 5 and released 12 days later.

China begins work on US$353 mln aluminum processing base

Antara, Indonesia - June 7, 2007

Fuzhou (ANTARA News/Asia Pulse) - Construction of a new US$353 million aluminum processing base, which experts say will reduce China's reliance on imports, began in eastern Fujian Province yesterday.

The plant, which belongs to Aluminum Corporation of China (Chalco) (SEHK:2600) is situated in Fuzhou, capital of Fujian, and will have an annual capacity of 350,000 tons of high-precision aluminum plate upon its completion in 2010.

Chalco, the country's biggest aluminum producer, is also building a large aluminum-processing base in northwestern Gansu Province.

Source: Business in Asia Today - June 7, 2007

Aluminum prices are poised to slide

Purchasing.com, MA - Jun 6, 2007

By Tom Stundza

The slight downward trend in aluminum prices persists. And, "from the fundamental, seasonal and technical standpoint (the predictable components of this market), aluminum prices should continue to head slightly lower," forecasts Harbor Intelligence in a note to clients. Reason: World supply is expanding while demand has stalled, boosting world stocks by 4.5% over last year.

Aluminum averaged $1.39/lb in May but the research house’s monthly technical indicator has given off bearish confirmation of imminent declines. Harbor Intelligence expects that today’s world market price on the London Metal Exchange (LME) of $2,755/metric ton ($1.25/lb) will head toward $2,750 ($1.247) and then toward $2,720 ($1.23). This is only slightly more bullish than Davenport Equity Research’s view that the world aluminum primary ingot price this year will average $2,700 ($1.22).

Aluminum prices have received downside pressure from news that Ormet has restarted its fifth potline and is planning to restart its sixth potline by September. "We should expect prices to continue to slowly trend lower for the rest of the year," says the report. "Nevertheless, prices will not fall that much given still low aluminum inventory levels in terms of weeks of consumption, a weak dollar, a bull market in nickel, lead and tin, still high copper and oil prices, and stable interest rates in the U.S."

Alcasa to receive US$40mn for upgrades in coming days - Venezuela

Business News Americas, Chile Thursday, June 7, 2007 13:07 (GMT -0400)

Venezuelan aluminum reducer Alcasa, a subsidiary of state heavy industry holding company CVG, will receive payment of US$40mn for technological upgrades in the coming days.

"With the money that Mibam [the ministry of basic industries and mining] contributes, a technological upgrade at Alcasa's reduction and rolling plants is guaranteed," a CVG executive told BNamericas.

The payment was announced after fire damaged facilities at the reducer's carbon anodes plant last week.

The company still does not know the extent of losses resulting from the blaze. "That is still being calculated," an Alcasa spokesperson said.

This year, the reducer expects to receive US$67mn for optimization of operating areas. The figure is part of a plan to upgrade technology by 2012 with a total investment of US$350mn.

Investments are specifically bound for reduction lines, the smelter, the rolling plant and the carbon anodes plant.

Alcasa is located in eastern Venezuela's Puerto Ordaz. CVG controls 92% of the firm and US company Alcoa (NYSE: AA) holds the remainder.

Minmetals plans to transfer overseas and domestic assets to Hong Kong-listed subsidiary

Interfax.cn (subscription), China - June 7, 2007

Shanghai. June 7. INTERFAX-CHINA - China Minmetals Corporation plans to transfer more of its overseas and domestic mineral resource development projects to its Hong Kong-listed subsidiary in the future, a senior company official told Interfax today at the Metal Mining North-East Asia 2007 conference, held in Shanghai.

"We would like to be more involved in global capital markets in the future and transfer both our overseas assets and domestic alumina, aluminum, lead and zinc assets to our Hong Kong-listed subsidiary, Minmetals Resources," Wang Jionghui, general manager of Minmetals' Mining Resources Division, said.

Minmetals is currently engaged in several metal ore exploration projects in Cuba, Chile, Jamaica and Australia.

"The company's ferronickel project in Cuba is currently undergoing a feasibility study and we are negotiating with the local government on issues of project infrastructure construction," Wang said.

"Poor local infrastructure has caused many project delays and we intend to spend much more money to improve conditions in the future. Money is not a problem for Minmetals and we hope to become a controlling shareholder in the project," Wang added.

Minmetals signed an agreement with Cuban mining company Cubaniquel in 2005 to establish a joint venture and invest $500 million to develop the Las Camariocas nickel deposit. The deposit has an estimated ferronickel output capacity of 68,000 tons per annum.

The official also said that Minmetals is looking for nickel properties in the Philippines and Indonesia.

The company was recently granted a prospecting license for a bauxite mine in Jamaica, and has made satisfactory progress in the relatively risky prospecting.

Minmetals intends to develop the Jamaican bauxite mine and construct a 1.5 million-ton alumina refinery in cooperation with U.S.-based Century Aluminum.

Minmetals aims to expand its core business to include mineral resource development, as the company was previously only a trading house. "Revenues gained from metal mining and production currently amount to 70 percent of the company's total revenue," he said.

Minmetals generated a total of RMB 18.9 billion ($2.47 billion) in sales revenues last year, he added.

Alcoa finishes soft-alloy venture with Norwegian firm

Pittsburgh Tribune-Review, PA Saturday, June 9, 2007

Alcoa Inc. said Friday it completed a deal creating a soft-alloy extrusion joint venture with a Norwegian firm, which involved selling about a dozen of its U.S. plants to form what it's calling the world's largest aluminum profile company. Alcoa's plant in Cressona, Schuykill County, was among the U.S. plants sold to the joint venture, but an Alcoa plant in Warren, Ohio, was excluded. The plants manufacture products such as bathroom fixtures, said spokeswoman Joyce Saltzman. The joint venture with Sapa Group, part of the Norwegian conglomerate Orkla ASA, creates a company with annual sales of about $4.5 billion and 12,000 employees. An international law firm with a Pittsburgh office, Duane Morris LLP, worked with Sapa on the deal, said Bruce Bowden, an attorney at the Pittsburgh office.The firm was selected because it previously represented an Okra subsidiary, Elkem Materials Inc., which has a sales office in Moon.

Russia could lower aluminum import duties

Interfax Russia, Russia - Jun 9 2007 12:00PM

ST. PETERSBURG. June 9 (Interfax) - Russia could lower aluminum import duties now that an aluminum giant has been formed, First Deputy Prime Minister Sergei Ivanov said at the economic forum in St. Petersburg.

"There are plans to lower import duties for aluminum following the formation of the [aluminum] industry giant," Ivanov said.

United Company RUSAL (UC RUSAL), the world's biggest aluminum company, was formed at the end of March through a merger with Russia's Siberian-Urals Aluminum Company (SUAL) and the alumina-related assets of Switzerland's Glencore International AG.

An understanding to lower the import duty on aluminum was reached during the merger process. The Russian Federal Antimonopoly Service (FAS), when approving the merger, said that the import duty, currently 10% of customs value, should be lowered in order to uphold competition and provide additional safeguards for the interests of Russian aluminum consumers.

Alro Slatina may take over thermal or hydropower plant

New Europe, Belgium - 9 June 2007 - Issue : 733

ROMANIA

Romanian aluminum producer Alro Slatina is interested in taking part in the privatisation of a power complex, so as to take over a thermal or hydropower plant, while not ruling out the option of building an electricity production facility in a green-field project in a neighbouring country, Nine o'Clock reported, cited by Reporter.gr. Alro is the largest electricity consumer in Romania, accounting for eight percent of the national consumption.

In order to ensure the necessary electricity, the company is considering three options. The first is for regulatory authorities to modify the current billing

system, to distinguish between smaller and larger consumers. The second alternative is to take over a power complex, a thermal power plant or hydropower plant, which should be rehabilitated and upgraded. The third option is the construction of a thermal power plant of up to 1,000 megawatts of installed power, for which the feasibility study has already been initiated.

According to the study, the thermal power plant would use coal as a raw material, which might be imported from Russia, Ukraine, New Zealand or Australia, it was reported. Construction works should take two years, after a financing source had been identified. "All companies interested in the privatisation of the power complexes have asked us whether we want to buy energy from them," Alro Board Deputy Chairman Marian Nastase was quoted as saying.

Indiana gives new start to metal finish company

Indianapolis Star, United States - 09-Jun-2007

High-tech manufacturer to employ 25 in Greenwood

By Kathryn Prater, kathryn.prater@indystar.com

One look at a map, and British metals-treatment company Keronite knew where to open its first American operation: Indiana.

KERONITE INC.

Location: 2121 Southtech Drive, Suite 220, Greenwood.

What it does: Developed a process to harden metal alloys.

Customers: Automotive, aerospace, oil and drilling, architectural and general industrial companies.

Headquarters: Cambridge, England.

Founded: 2000.

The state's central location was perfect for the visibility sought by the high-tech manufacturing company, which also considered Detroit and New York before opening in Greenwood last month.

"A lot of companies we deal with pass through Indiana," said Paul Edmonds, vice president of global operations. "It's an ideal position for us."

Keronite holds a patent for an environmentally friendly technology that hardens certain alloys -- primarily aluminum and magnesium -- by altering their structures. Metals coated with Keronite's finish typically become three times as rigid, although it varies by product.

The company's technical and manufacturing center in Greenwood's Southtech Park allows companies to get training on Keronite's equipment or use it to run their own prototypes.

The equipment, manufactured in England and transported to Greenwood, usually is leased to manufacturers. Workers at the Greenwood facility also do small amounts of finishing for businesses unable to rent the machinery.

Keronite's markets include aerospace, oil and drilling, architectural, industrial and automotive companies, including some in the auto-racing industry, which needs high-strength but lightweight parts. Instead of steel, manufacturers could substitute Keronite-treated aluminum, which essentially would have an equally hard surface.

"They're actually taking weight out of an engine," Edmonds said.

"The race industry is an interesting one for us because of the prestige you get for being part of it. We very much like being associated with the race world."

Keronite announced last month that it will invest $1.5 million in equipment and facilities, and employ about 25 people.

If the Greenwood operation, 2121 Southtech Drive, Suite 220, is successful, expansion is likely, Edmonds said, adding the company also plans similar facilities worldwide.

Keronite will receive up to $250,000 in performance-based tax credits from the Indiana Economic Development Corp. and up to $64,000 in training grants.

The city of Greenwood is providing a personal-property tax abatement of approximately $34,000 over 10 years, said Cheryl Morphew, executive director of the Johnson County Development Corp. There are eight years left of an existing 10-year tax abatement on the building.

Keronite opened a temporary office in Downtown Indianapolis four years ago. Six employees currently work in Greenwood -- three from England, two from Indianapolis and one from Greenwood. Edmonds hopes to hire about 20 more Greenwood workers within the next year.

"These are very high-tech jobs, and the wages were above our county's average," Morphew said. "We were very excited to get this kind of company here."

Keronite's employees in Greenwood make about $19.49 an hour, while Johnson County's workers earn an average of $13.93, she said.

Through April, Indiana lost about 11,000 manufacturing jobs, or 2 percent, from a year earlier, according to the Indiana Department of Workforce Development.

"The routine jobs are pretty much being replaced by high-tech jobs," said Pat Kiely, president of the Indiana Manufacturers Association. "If you had a routine job on an assembly line, you may have to go back to school to change your skill level."

Kiely estimated about one-third of Indiana's workers will need retraining during the next five to 10 years.

Call Star reporter Kathryn Prater at (317) 444-6306.

Atomstroiexport, Rusal to build NPP, aluminum plant

ITAR-TASS, Russia 10.06.2007

ST. PETERSBURG, June 10 (Itar-Tass) -- Atomstroiexport and Rusal will build the first nuclear power plant and an aluminum plant in the Far East. The total value of the project is about $9 billion, a source said on Sunday.

Rusal’s Valery Draganov described the project is unprecedented. He also said that the future construction site would be chosen within two years.

Aluminium sector in for more M&As

Business Standard, India June 11, 2007

Analyst's View : Kunal Bose

Among the many virtues of capacity consolidation, arguably the most important is the discipline it brings into product pricing and supply. Mergers and acquisitions (M&As) are also attempted to cut costs from raw materials procurement to distribution of products leading to lower borrowings but improving the leveraging capacity. Bigger entities resulting from M&As, thus, become ideally placed to create new capacity and climb the value chain.

In the case of failed attempts to acquire the Montreal-based Alcan, first through friendly talks over two years and then by mounting a hostile bid, Alcoa had some extra considerations to pursue the trophy. First, the US aluminium giant believed, and rightly so, that unless it had acquired Alcan, it itself would run the risk of becoming a takeover target. Alcoa will not pride itself on shareholder value creation. And that is what invites predators.

Secondly, Alain Belda, chairman and CEO of Alcoa, has not been comfortable about the "emerging global players in Russia, China, India and the Middle East quickly expanding and adding capacity on a global basis." He conveyed this concern to analysts as he mounted the hostile bid for Alcan, obviously conveying the impression that an Alcoa-Alcan link up would enable the combined entity to hold its ground in the unfolding situation. Nalco, Hindalco and Vedanta have all global ambitions.

Incidentally, Belda could get his Alcan counterpart to start discussing merger by showing him the unnerving prospect of China and Russia challenging their supremacy not in too distant a future. It is another matter that in spite of many compelling reasons to tie the knot, the Alcan management rejected the $27.6 billion Alcoa offer.

In a strong rebuff, Alcan cited "different approaches and track records in creating shareholder value" of the two parties and Alcoa’s failure to make "a compelling proposal" designed to uphold the "best interests of our shareholders" as the reasons not to link up with the much bigger corporate entity across the border. Moreover, how could Alcan management have ever recommended an offer for takeover valuing Alcan shares at a ridiculously big discount over exchange traded prices.

Alcoa might not have won the day. But both the predator and the target will remain takeover targets. The two world mining behemoths BHP Billiton and Rio Tinto are also leading producers of aluminium and they have overflowing coffers, thanks to the long bull run in minerals and metals. They may be yearning to possess Alcoa and Alcan. However, all will finally depend upon what extra value they will bring to the business and shareholders.

But is there an aluminium group in China, which might spring a takeover surprise on the world stage. If a bet is to be put, it will be on the state-controlled Aluminium Corporation of China, popularly known as Chalco. The company having taken the lead in consolidating capacity in the country should see its 2007 production take a leap of at least 33 per cent to 2.4 million tonnes, that is, nearly 1.4m tonnes more than India’s 2006 output. As Chalco will be engaged in further capacity consolidation within China, it has decided to look beyond national shores for acquisition and greenfield ventures. Chalco is not the only Chinese group with the ambition to make the metal or the intermediate product alumina. Only recently, two Chinese groups decided to partner Saudi investors in a $5 billion composite project which includes a 1.6 million tonne alumina refinery, a 660,000 to 700,000 tonnes smelter, a back up power complex and a dedicated dock system. India is also on the Chinese radar for creating a production base as the Ashapura alliance shows.

According to industry officials here, China has finally come to grips with the local occurrences of low quality bauxite for its processing into alumina, which is finally smelted in white metal. As against the scene in India where inordinate delays in opening up of bauxite mines are the order of the day, China this year is geared to lifting alumina production by 46 per cent to 19.27 million tonnes from 13.2 million tonnes in 2006. In fact, the Chinese surge in alumina production is the reason for the big fall in the world prices of the intermediate chemical. Of late, prices have rebounded to some extent, though.

But in spite of the spectacular alumina production rise, China will still remain an importer of the chemical, including from India. This is because China is targeting metal production of 11.5 million tonnes in the current year against the actual output of nearly 9.35m tonne in 2006. For every unit of the metal, two units of alumina are needed. Therefore, China will have to import at least 3.75 million tonnes of alumina this year. The CEO of a leading Indian aluminium producer says if the white metal is proving to be the "least sexiest" of all base metals, it is due to the China factor. But will China, in spite of alumina deficit and high energy cost, still go ahead with metal exports? At this point, this remains a riddle.

Alcan plans new world-class facility in China

Canada NewsWire (press release), Canada - 11-Jun-2007

TAPS NEW MARKET OPPORTUNITIES FOR ITS ALLOY PRODUCTS

ATLANTA, U.S.A., June 11 /CNW Telbec/ - Alcan Inc. announced today that it plans to build a world-class manufacturing facility in Tianjin, China to provide new innovative alloy cable products to serve the Chinese market.

"We are excited about the opportunity to offer our high quality products as reliable, cost effective solutions to China's rapidly growing commercial construction market," said Ian Hewett, President, Alcan Cable. "I want to express our appreciation to the Tianjin government for their support of our efforts to establish a presence in China. We look forward to developing

relationships with the local business community and the Chinese construction industry," he added.

Alcan plans to invest approximately US$ 40 million to build the new manufacturing facility that will use leading-edge technology to produce specialty alloy cable products for commercial, institutional and industrial applications.

Alcan Cable is a leading manufacturer of aluminum cables for the utility, residential, and commercial markets in North America.

Aluar employees reject call to reconcile - Argentina

Business News Americas, Chile - Tuesday, June 12, 2007 14:03 (GMT -0400)

Employees at Argentine aluminum producer Aluar (Buenos Aires: ALUA) affiliated with national metalworkers union UOM have rejected a call from the government to settle a strike underway at the Puerto Madryn plant since June 8.

"The labor ministry called for an obligatory reconciliation but the union heads will not accept that," Mariana Rivarola, external relations assistant at the plant, told BNamericas.

With the refusal, the strike continues. "People are blocking the door and our productive process is running increasing risk," she said.

DISMISSALS

The company has confirmed that nearly 100 employees have been fired during the course of the conflict, mainly for non-compliance with essential duties established in a previous agreement, such as keeping guards on site to protect equipment at the plant, Rivarola said.

The company was willing to accept the labor ministry's statement that reconciliation is obligatory and to start anew by retracting the dismissals. "But they are not willing to do that on the other side. They are assuming that cost," she said.

The strike will not affect expansion works at the Aluar plant since construction workers belong to a different union and will continue with works, the official said previously.

Aluar is controlled by the Madanez Quintanilla family and will soon put the first stage of a nearly US$800mn expansion project into action.

The project is designed to boost Aluar's production capacity from 280,000t/y to 400,000t/y and looks at incorporating 144 electrolytic cells.

By Harvey Beltrán, Business News Americas

L&T, Dubal propose to ramp up Orissa alumina project capacity

Financial Express, India - Wednesday, June 13, 2007 at 0126 hours IST

BHUBANESWAR, JUN 12: Dubai Aluminium (Dubal) and Larsen &Tubro (L&T) have proposed to increase the capacity of their Orissa alumina refinery project from 1 million tonne to 3 million tonne. A proposal to this effect has already been submitted to the state government.

L&T, which has the mining rights of Sijumali-Kuturmali bauxite mines in Kalahandi and Rayagada districts of Orissa, has entered into an agreement with the Dubai-based aluminium company, Dubal, to float a joint venture company in order to set up the aluminium complex in the state.

The original plan was to set up an 1 million tonne refinery and an aluminium complex with captive power plants with an investment of Rs 16,026 crore. The investment would now be around Rs 20,000 crore with the enhancement of the refinery capacity.

The project includes a smelter of 7.5 lakh tonne per annum and two captive power plants of 600mw and 1200mw. The two companies have also proposed to lay the 76-km Gunpur-Therubali railway track critical for the refinery plant in Rayagada district.

The amendment to the MoU would be effected following the nod of the high-power project clearance authority headed by chief minister Naveen Patnaik.

In 1992-93, L&T received the prospecting licence for the bauxite mines following signing of an MoU with the government of India for setting up an alumina refinery. However, the company was unable to set up the plant then as it could not find a suitable partner.

It roped in Dubal when the Orissa government had threatened to cancel the licence in late nineties. The joint venture project too ran into rough weather as the state government had insisted that there should be value addition to alumina in the state.

According to the state government's policy, 25% of the alumina must be converted to aluminium in the state. At one point of time, L&T even brought the matter to the notice of the Prime Minister's office.

However, the deadlock is expected to be over with the companies coming up with a fresh proposal to enhance the project capacity.

Montenegro Abandons Energy Sale to Russian Businessman

BIRN, Serbia - 12 06 2007

Podgorica, – Montenegro’s government on Tuesday bowed to parliament’s demand for it to abandon the planned privatisation of the country’s major energy complex at Pljevlja.

"The government has decided to accept the conclusions of the majority", the Prime Minister, Zeljko Sturanovic, said. "We won’t continue the privatisation process of the thermal plant and coalmine until we obtain a wider consensus, and at least the support of our coalition partners."

Sturanovic sharply criticized parliament’s vote against the planned sale of the coalmine and thermal plant in Pljevlja, which produces one-third of the country’s energy, to the Russian aluminium mogul, Oleg Deripaska.

He accused his opponents of "jeopardizing economic growth", warning that the decision would confuse much-needed foreign investors.

Parliament voted down the privatization of the complex and its sale to the Russian magnate after the Social Democratic Party, the junior partner in the coalition government, challenged its senior partner, the Democratic Party of Socialists over the sale. The SDP warned that if the plan was not abandoned it would force early parliamentary elections.

"Energy resources should remain the property of the country", the SDP and other deputies said, in a letter to the government, urging it to work on a different long-term development strategy for the energy sector in Montenegro.

Parliament’s decision, which does not oblige the government, came after the dispute between the two ruling parties threatened to escalate. "The winner of this dispute is political stability, which we, as the youngest world’s country, need the most," Sturanovic concluded.

The government started talks with Deripaska’s N Plus Group, winner of the last year’s tender and the recent purchaser of Montenegro’s aluminium producer KAP and bauxite mine, after it offered 50 million euros. It also offered to invest more than 200 million euros in the site over the next five years.

By buying the thermal plant and coalmine, the Russian businessman would have massively enlarged his portfolio in the republic, effectively taking control of about 40 per cent of Montenegro’s economy.

Alcoa restarting aluminum smelter

WBIR-TV, TN - 6/13/2007 4:49:39 PM

By: Jake Jost, Investigative Producer

Aluminum manufacturer Alcoa has begun to restart one line at its Tennessee Operations aluminum smelter.Advertisement

Alcoa said Wednesday that the line was idled because of a direct lightning strike in a severe electrical storm in mid-April. The potline, which produces approximately 107,000 metric tons per year, is expected to be fully operational by June 30.

The potline in Alcoa, Tennessee, was frozen after the lightning strike and each of the 164 pots had to be dug out and repaired. Alcoa initially thought the restart would take several months.

Alcoa also says it's reduced output at its Rockdale, Texas, aluminum smelter during refurbishment, and it expects the restart to be completed during the fourth quarter.

The production curtailments will mean a roughly $45 million drag on second-quarter profit.

Rusal Seeks Outlet to Sea

Kommersant, Russia - June 14, 2007

Russian Aluminum (Rusal) intends to begin construction of specialized port terminals for the transshipment of alumina to meet the needs for additional raw material by 2012 when Rusal reaches full capacity. Analysts say that Eastern Port in the Russian Far East or Ust-Luga in Leningrad Region is the most likely place for them and that a single terminal will cost $30-50 million.

Head of the Rusal press service Vera Kurochkina said that the plan for the construction of the terminals has been approved by the company's strategic planning committee. She names the Ports of Novorossiisk, St. Petersburg and Vanino among those with which negotiations are now underway, adding that the choice will be made before the end of the year. Russia does not have any specialized alumina terminals at present.

VIKA analyst Alexey Pavlov said that Rusal will need an additional 3 million tons of alumina when its three plants reach their production capacity, and another 1.5 million tons will be needed for investment projects in the Russian Federation. Pavlov thought that the Far East was the most attractive location for the terminals, since they could handle shipments from Queensland Aluminia, Rusal's Australian subsidiary.

Other experts pointed out that the company will not receive permission to load alumina within the limits of a city, which rules out Novorossiisk, Vladivostok (Eastern Port) and St. Petersburg.

Alcan Signs Agreement to Supply Airbus With Aluminum (Update1)

June 13 (Bloomberg)

By Andrea Rothman and Chanyaporn Chanjoroen

-- Alcan Inc., the world's third-largest aluminum producer, signed an agreement with Airbus SAS to provide the metal for planes including the superjumbo A380. The value and duration of the deal were not disclosed.

``This agreement underscores Alcan's position as the largest supplier of aluminum products to Airbus and the importance of the aerospace market segment to Alcan's strong business portfolio,'' Christel Bories, chief executive officer of Alcan Engineered Products, said in a statement.

Airbus, the world's largest planemaker, will use Alcan aluminum on the new A350 XWB, a competitor to Boeing Co.'s 787 Dreamliner. Montreal-based Alcan will also supply European Aeronautic, Defence & Space Co., the parent of Airbus, with aluminum-based products including alloys that are lighter than the traditional metal.

Aircraft designers are moving away from metals in favor of lighter composite materials. The A350 will use 52 percent composites, the plane's chief engineer, Gordon McConnell, said June 4. The plane will use 20 percent aluminum and aluminum lithium for its structure, 14 percent titanium and 7 percent steel.

Aluminum is used in jet engines, fuselages and wings. New planes such as the 555-seat A380 require about twice as much of the metal as traditional single-aisle planes such as the A320 made by Toulouse, France-based Airbus or the Boeing 737.

The A350, set to enter service in 2013, is largely designed though final details won't be worked out until late 2008. The 270- to 350-seat plane also is a competitor to Boeing's 777, which seats about 350.

Alcan is the world's third-largest aluminum producer based on production capacity in 2007, after Alcoa Inc. and United Company Rusal.

To contact the reporters on this story: Andrea Rothman in Toulouse, France at aerothman@bloomberg.net ; Chanyaporn Chanjaroen in London at cchanjaroen@bloomberg.net

Aluar strike comes to an end - Argentina

Business News Americas, Chile Friday, June 15, 2007 12:44 (GMT -0400)

Employees of Argentine aluminum producer Aluar (Buenos Aires: ALUA) affiliated with national metalworkers union UOM have ended the strike underway at the Puerto Madryn plant in Chubut province since June 8.

"At a massive group assembly, employees voted to go back to work as of 5:00am Friday," Mariana Rivarola, external relations assistant at the plant, told BNamericas.

Employees have accepted an appeal to reconcile made by the government days ago, which they had previously rejected, she said.

Now the parties will begin a series of meetings to negotiate the 45% salary adjustment employees are requesting.

During the conflict, the company had said that nearly 100 employees had been fired, mainly for non-compliance with essential duties established in a previous agreement, such as keeping guards on site to protect equipment at the plant during a strike.

However, the company reversed the dismissals when employees agreed to reconcile, Rivarola said, adding that "now, while they are negotiating, everyone is working because they are starting from scratch."

Regarding possible production losses at Aluar as a result of the weeklong stoppage, Rivarola said that if there were effects, they have not yet been quantified.

Aluar is controlled by the Madanez Quintanilla family and will soon put the first stage of a nearly US$800mn expansion project into action.

The project is designed to boost Aluar's production capacity from 280,000t/y to 400,000t/y and looks at incorporating 144 electrolytic cells.

Bechtel-Built Aluminum Smelter Opens in Iceland

InfoBolsa, Spain - 15/06/2007 16:10:00

The Bechtel-built Alcoa Fjardaal smelter, one of the world s safest, most sustainable, and technologically advanced aluminum production facilities, has officially opened.

Bechtel served as prime construction contractor for the smelter, located on the east coast of Iceland.

It has been built on schedule and on budget, despite the challenges of construction in a harsh northern climate.

The plant, which broke ground in July 2004, cast its first aluminum this April and by the end of 2007 will reach full production capacity of 346,000 tons per year.

On June 9, Alcoa celebrated the formal opening of the smelter.

Iceland s prime minister spoke at the ceremony, lauding the fact that it will provide secure and safe jobs for the people of East Iceland.

Three hundred of the smelter s expected 400 workers have already been hired.

Sixty-percent of the workers are from the local area.

Bechtel Chief Executive Officer Riley Bechtel also spoke at the ceremony, thanking the people of Iceland for welcoming a foreign company and foreign workers to make the construction a success.

Bechtel directed 2,200 workers from Iceland, Poland, and other countries on the project.

To house employees, the company erected a large team village near the existing village of Reyoarfjorour, about three miles from the smelter.

Despite the influx of new Icelandic and foreign workers, relations between the project and the township of some 700 residents have been excellent, thanks to the cooperation of local authorities, open communication, and careful planning.

The project has won praise in Iceland for setting an exceptionally high standard of safety based on Bechtel s "zero accidents" philosophy.

It also won Iceland s highest environmental award, the Conch, for its policy of generating no waste to landfill, and not discharging wastewater into the neighboring fjord.

Based in San Francisco, Bechtel is one of the world s premier engineering, construction, and project management companies and a leading contractor for the aluminum industry.

Since its founding in 1898, Bechtel has worked on more than 22,000 projects in 140 countries on all seven continents.

Today our 40,000 employees are teamed with customers, partners, and suppliers on hundreds of projects in nearly 50 countries.

For more information about Bechtel, visit www.bechtel.com.

Cleanup accelerated at Kaiser Trentwood Printer-Friendly Version

Spokane Journal of Business, WA -15 Jun 2007

Ecology officials fear that toxins in the soil on part of site could run off into Spokane River

By Emily Brandler

The Washington state Department of Ecology is accelerating cleanup of a 2-acre site at Kaiser Aluminum & Chemical Corp.’s 512-acre Trentwood rolling mill here.

Kaiser has been investigating soil and ground water contamination at its Trentwood site under an agreement it reached with Ecology in 2005, and has found that the roughly 2-acre portion of land is particularly contaminated, says Jani Gilbert, a spokeswoman for Ecology here. That site, called the "west discharge ravine," is at the west end of the Trentwood site, which is located in Spokane Valley west of Sullivan Road and just north of the Spokane River.

"We decided we better do something about the west ravine now, because it’s a more heavily contaminated area, and when it rains in the fall, there’s more chance of sending contaminants into the river," Gilbert says.

A spokesman for Foothills Ranch, Calif.-based Kaiser couldn’t be reached for comment on the accelerated cleanup.

Without the accelerated schedule, cleanup work on the ravine likely would have started in 2009, when Ecology expects cleanup work on the rest of the Trentwood site to begin, Gilbert says. Kaiser is continuing its investigation into the extent of the contamination of the entire Trentwood site and is having a feasibility study done to identify and evaluate cleanup options. The investigation and study of the Trentwood site, which Ecology is overseeing, are expected to be completed by late 2008, Gilbert says.

Ecology says contaminants at the site include polychlorinated biphenyls (PCBs), petroleum, arsenic, and metals such as iron, manganese, and antimony. Petroleum containing PCBs has been found floating on top of the groundwater in some areas of the site. For the past several years, Kaiser has been removing that petroleum and pumping out groundwater to keep the contamination from spreading, says Teresita Bala, a site manager and environmental engineer at Ecology.

The manufacturing of PCBs has been banned in the U.S. since 1977. PCBs are known to cause cancer in animals, and are a suspected human carcinogen.

Gilbert says that removing PCBs from the Trentwood site is essential to preventing them from spreading to groundwater in other areas of the site, and ultimately to the Spokane River.

The ravine will be cleaned up before the rest of the Trentwood site partly because the contaminated soil is located close to the river, within an area where rainwater could cause the soil to run off into the river, which makes the site particularly vulnerable, Gilbert says.

Trentwood is one of the largest known sources of PCBs in the river, she says. The Spokane River becomes the Long Lake reservoir, located northwest of Spokane, so most pollutants typically wind up there, Gilbert says.

The primary way humans are exposed to PCBs is by eating fish that have been contaminated, since PCBs accumulate in the fatty tissue of fish, she says. A fish advisory currently is in effect for people who eat fish taken from the Spokane River. In some parts of the river, people are only supposed to eat one meal of fish a month. In other parts of the river, fish consumption is advised against totally.

What’s called interim actions, which provide for accelerated cleanup at a site to protect public safety and the environment, are planned for the ravine.

Ecology considered three options there, including taking no action; placing a protective cover over the contamination and limiting site access and excavation; and removing the contamination and hauling it to an off-site disposal facility, backfilling those cleaned areas, and restoring them with natural vegetation.

Ecology chose the third alternative. It has issued a determination of non-significance for the project, which means that the proposed interim actions likely won’t harm the environment further.

Documents associated with the cleanup plan are available for public review and comment through June 27. After the comment period, Ecology plans to issue a summary that answers questions or comments the public has submitted.

Unless it modifies its plans in light of those comments, Ecology expects to start cleanup work in the middle of next month and complete the project by mid-September, Gilbert says.

The work will involve hauling an estimated 1,500 cubic yards, or roughly 125 dump trucks, of contaminated materials from the site to a disposal facility, she says.

According to estimates included in state documents related to the project, the cleanup will cost Kaiser $400,000.

The federal government built the Trentwood plant in 1942 to manufacture aluminum for World War II aircraft. Kaiser leased the facility in 1946 and later bought it along with the now-closed Mead smelter. The ravine where the interim cleanup has been proposed was used as a waste-water "conveyance" from 1942 to about 1973, when waste-water facilities were upgraded, Ecology says.

Since 1979, Kaiser voluntarily has installed more than 100 wells to monitor toxic releases on the property, and, in 2002, it voluntarily installed a $5 million waste-water treatment facility there. In 1995, Ecology named Kaiser as the potentially-liable party responsible for cleaning up the site, and two years ago, the parties reached a legal agreement on an order that would result in cleanup work.

Contact Emily Brandler at (509) 344-1265 or via e-mail at emilyb@spokanejournal.com.

UPDATE: BHP Hires Merrill Lynch To Advise On Alcan Bid

CNNMoney.com June 19, 2007: 12:22 AM EST

HONG KONG (Dow Jones) -- Anglo-Australian miner BHP Billiton has hired Merrill Lynch & Co. to assist in reviewing a takeover bid for Montreal-based Alcan Inc. according to reports Monday.

Melbourne-based BHP Billiton (BHP) , the world's largest miner by volume and revenue, has hired Merrill Lynch (MER) to help in examining the possibility of an offer for the Canadian aluminum producer, according to media reports.

The Times of London reported earlier in the week that BHP Billiton had revived plans for a $40 billion takeover of New York-based Alcoa Inc. (AA) . The British newspaper report said BHP was in the early stages of evaluating the merits of a takeover and is not thought to have formally approached Alcoa.

Alcoa and Alcan (AL) rank as the second- and third-largest aluminum producers globally. Russia's United Company Rusal took the top spot following a three-way merger that was completed at the end of March.

Resource and mining analysts in Australia said it was likely BHP Billiton had assessed the merits of a takeover of both aluminum producers, but added there was little to suggest a bid for either was imminent.

Sydney traded shares of BHP Billiton dropped 0.6% to A$34.48 ($29.08), scaling back after closing at a record in the previous session.

In May, Alcoa launched a $27 billion hostile takeover for its Canadian-based rival, which was later rejected by Alcan's board.

Alcoa, meanwhile, has submitted plans to U.S. antitrust authorities to win approval for a possible takeover of Alcan, aiming to smooth the regulatory road bumps that a combination of the two aluminum giant would likely raise.

Alcoa is also considering selling off its packaging and container operations, a move applauded by shareholders who argued they were a drag on the more profitable mining and smelting division.

If Alcoa's bid for Alcan is successful, it would solidify Alcoa's spot as the world's largest maker of raw aluminum, with control over 20% of the world market.

Several companies are reportedly circling both Alcoa and Alcan as potential takeover targets.

BHP Billiton eyes 51 pct in India project - paper

Reuters.uk, UK - Jun 17, 2007

MUMBAI, June 18 (Reuters) - BHP Billiton Ltd./Plc. (BHP.AX: Quote, Profile , Research) (BLT.L: Quote, Profile , Research), the world's biggest mining group, is in talks to buy a 51 percent stake in an Indian alumina project, the Business Standard newspaper said on Monday.

Indian mining and mineral firm Ashapura Minechem Ltd. (ASHM.BO: Quote, Profile , Research) will hold the remaining 49 percent in the 25-billion-rupee ($614 million) project in the eastern state of Orissa, the paper said, quoting unnamed sources.

The two partners will invest 8 billion rupees towards equity and the remaining 17 billion will be raised through debt, it said.

The spokesman for Mumbai-based Ashapura could not immediately comment on the report.

In May, an official at Ashapura had said it was bidding for a bauxite mining lease in Orissa.

The Business Standard reported quoted Managing Director Chetan Shah as saying that it would take three months for government approval, and the project would be commissioned by next year.

But he declined to identify a likely partner, the paper said.

Ashapura has a tie-up with China's Qingtongxia Aluminium Group for a 25-billion-rupee alumina refinery project in the western state of Gujarat. Construction work is scheduled to start in November. ($1 40.7 rupees)

Kaiser to make $34 million investment in Trentwood

The Spokesman Review, WA June 19, 2007

By Parker Howell Staff writer

Kaiser Aluminum Corp. will spend an additional $34 million on equipment for its Trentwood rolling mill to further increase its heat-treated metal plate production, the company announced Tuesday.

Unspecified new agreements with customers necessitate the equipment, a follow-up to $105 million in capital upgrades already underway in Trentwood, said company CEO Jack Hockema. He declined to elaborate on the type of equipment to be added or on new Kaiser contracts, but said the agreements "do have sufficient length that it justifies us making additional investment."

"We've determined that, in fact, we have some customers who recognize that there was some additional need," Hockema said, adding that the company has no plans to announce new contracts.

Both Hockema and the plant's union leadership foresee a brighter future for Foothill Ranch, Calif.-based Kaiser, which emerged from bankruptcy last summer and plans to double its aluminum plate capacity through the expansion. The company makes aluminum products for the aerospace, transportation and industrial markets.

"Obviously, we're making some big investments in Trentwood, and we wouldn't do that unless we were confident we had a good total business situation there," Hockema said.

Kaiser has added roughly 100 employees in Trentwood during the last year, increasing its workforce there to about 800, said company spokesman Geoff Mordock. That's about double the number of workers in 2002, when Kaiser declared bankruptcy, he said.

The latest investment should create a few more jobs, Hockema said.

Dan Wilson, president of United Steelworkers Local 338, said the business is experiencing the "best conditions" he's seen since he started there more than two decades ago.

"The business base is good," said Wilson, who represents about 775 union members at the plant.

RusAl, Areva Venture

The Moscow Times, Russia Wednesday, June 20, 2007. Issue 3681. Page 6.

United Company RusAl, the world's largest aluminum producer, and Areva, the biggest maker of nuclear plants, agreed to form a joint venture to modernize aluminum smelters, RusAl said Tuesday in a statement.

The venture will produce and deliver $500 million of smelter equipment to the Sayanogorsk and Bratsk smelters, RusAl said.

Century and Guangxi Sign MOU for Aluminum Project in China

Marketwire (press release), Canada - Jun 19, 2007 09:00 ET

MONTEREY, CA--(Marketwire - June 19, 2007) - Century Aluminum Company (NASDAQ: CENX) announced today that it has signed a memorandum of understanding (MOU) with the Guangxi Investment Group Company (GIG) to explore the feasibility of developing a high purity aluminum reduction project and related bauxite and alumina supplies in China.

The project is targeted for Laibin, in the Guangxi Zhuang Autonomous Region, one of China's largest bauxite reserve areas. The project would consist of a 500,000 tonne aluminum smelter that would be constructed in two phases, and which would supply an integrated aviation and alloy products facility that GIG is developing.

"We are very pleased to be working with the Guangxi Group," said president and chief executive officer Logan W. Kruger. "We see great potential in this region of China and look forward to exploring the feasibility of a mutually beneficial project."

Century Aluminum Company owns primary aluminum capacity in the United States and Iceland, as well as an interest in alumina and bauxite assets in the United States and Jamaica. Century's corporate offices are located in Monterey, California.

Alcan proceeds with preparations for the Kitimat Works Modernization Project

CNW Telbec (Communiqués de presse), Canada June 21, 2007
Company signs engineering and design contract with ABB Group

KITIMAT, BC, June 21 /CNW Telbec/ - Alcan Inc. announced today that it has signed a contract with ABB Group for the design and engineering of a new high-voltage substation that will provide power to the planned expansion of Alcan's Kitimat smelter. Terms of the contact were not disclosed.

Michel Jacques, President and CEO, Alcan Primary Metal Group stated: "Alcan is pleased to announce the signing of this contract. It demonstrates our commitment to the Kitimat Works Modernization Project and our promise to our labour union, CAW local 2301, that we would move forward after the long-term labour agreement was ratified."

The contract with ABB Group will allow for the design and engineering of Kitimat's new power substation. ABB Group has announced plans to establish a permanent office in the Kitimat community by August 2007.

The announcement of the contract was made at Alcan's new Modernization Information Office in Kitimat, where Paul Henning, Managing Director of BC Operations for Alcan Primary Metal, stated that: "This is a significant step forward for Alcan in BC. With today's announcement, we are demonstrating Alcan's continued commitment to Northern BC and our determination to move forward with the modernization project," he added.

The Kitimat Works Modernization Project was announced on August 14, 2006 and is subject to the final approval of Alcan's Board of Directors and to certain conditions including environmental permits and the successful conclusion of agreements with BC Hydro and the CAW union. Alcan reached an agreement with CAW in May 2007 and is currently working to satisfy the other two conditions.

The modernization of Alcan's Kitimat smelter would increase Alcan's annual global primary aluminum production by more than four percent and make Kitimat not only one of Alcan's largest wholly-owned smelters, but also one of the three largest in North America. Kitimat's aluminum production would increase by 40 percent and reduce GHG emissions by half a million tonnes per year.

Vogar agrees to discussions with Alcan

IcelandReview, Iceland - 06/21/2007

The inhabitants of Vogar (pop. 1,100) on Reykjanes peninsula, agreed to begin discussions with the Canadian aluminum company Alcan at a meeting yesterday regarding the construction of a smelter within their town limits.

Mayor of Vogar Róbert Ragnarsson opened the meeting by proposing that the local authorities should discuss a potential smelter on Keilisnes, a nearby spit of land, with the aluminum company, which already operates a smelter in Straumsvík inlet near Hafnarfjördur, Morgunbladid reports.

Ragnarsson argued in his speech that the smelter would create 300 to 400 jobs and the community’s annual income would increase by ISK 300 to 400 million (USD 4.8 to 6.4 million, EUR 3.6 to 4.8 million).

After the mayor had spoken about 30 people took the floor; some were completely against an aluminum smelter within their town limits and others were in favor of it.

Those against the smelter said they would like to keep the community as small as it is and preserve its natural beauty. They pointed out that there is no unemployment in Vogar at the moment and said they didn’t see the purpose in increasing the number of jobs, which would probably end up in the hands of foreign labor.

The vast majority of attendees, about 140 people, accepted the mayor’s proposal.

Bauxite refinery in Ghana soon

Joy Online 19-Jun-2007

ALCAN, the Canadian bauxite giant, is to establish a bauxite refinery in Ghana, a move President John Agyekum Kufuor says would help to add more value to the mineral resource.

A site for the project has already been acquired at Sekondi-Takoradi in the Western region.

Ms Jacynthe Cote, the Vice President of ALCAN International and Chief Executive Officer (CEO) of ALCAN Bauxite and Alumina, which has been operating in the country for over 60 years now, said good progress was being made on the refinery project.

This was when she led a delegation of the company to pay a courtesy call on President Kufuor at the Castle, Osu, on Tuesday.

She acknowledged the high quality of the country's mineral resource and said the financials were also good and that the company was delighted to have invested in Ghana.

President Kufuor expressed his delight about the refinery project, which incidentally coincides with the discovery of oil reserves off the coast of Axim and said, "It seems we are into the best of times."

He announced an ALCAN/Ghana partnership to exploit the huge bauxite deposits at Nyinahin in the Atwima-Mponua District of Ashanti and said the mineral would be refined in the country.

President Kufuor, during an earlier courtesy call on him by a delegation from the International Commercial Bank (ICB) Global Financial Holdings, spoke of the government's determination to ensure that the country's oil discovery became a blessing to the nation.

He said Ghana would learn from the experience of countries that have succeeded in managing this natural resource well to the advantage of their economies and the benefit of their peoples.

Tun Dain Zainuddin, the Executive Chairman of the company, said in his country, Malaysia, oil has been of tremendous support to the economy.

The prospects for Ghana therefore looked bright, he said.

Source: GNA

RAK alumina refinery work in fast-track mode

Siasat Daily, India - Thursday, 21 June 2007

Visakhapatnam, June 21: The Rs.9,000-crore alumina refinery and smelter project proposed by Ras Al Khaimah (RAK), one of the seven constituents of the United Arab Emirates, in Visakhapatnam district is accorded top priority by the State Government to ground its work.

The way things are moving after the Government signed memorandum of understanding on Feburary 15 gives an impression that everything is being done on fast-track mode without making the contents of the agreement public.

Land acquisition

District Collector Anil Kumar Singhal recently issued the draft land acquisition notification for 350 acres in Makavaripalem mandal setting in motion the process for the mega project – the second in alumina project after public hearing was held for the 1.4 million tonnes a year alumina refinery of JSW Aluminium Limited near S.Kota in Vizianagaram district.

The notification is only the beginning as RAK Crown Prince and deputy leader Sheikh Saud Bin Saqr Al-Qasmi during his chat with Chief Minister Y.S. Rajasekhara Reddy had sought 2,600 acres.

The promoters have promised to start construction in six months and go on stream in three years from the date of receiving all clearances.

A survey for land was conducted within two months of signing the MoU and the notification was issued with the same speed and duration.

High-grade ore

For the one million tonne refinery and 2.5 lakh-tonne smelter with provision to double the capacity, RAK wants the AP Mineral Development Corporation to supply high-grade bauxite ore from Jerella group near Chintapalle.

A pipeline will be laid from the hills to the project site in Makavarapalem mandal.

Scheduled area

While the project site is located in the plains, the mines are in scheduled area. JSW Aluminium Limited wants to go ahead with its project by getting uninterrupted supply of bauxite ore from Galikonda hill in Anangagiri mandal through APMDC.

Besides, Jindal and RAK, BHP Billliton, world’s leading mining company from Australia and National Aluminium Company, which has its alumina refinery at Damonjodi of Orissa, have also submitted proposals for setting up aluminium complexes in the district with massive investment.

Alcan's Avoiding Alcoa

Forbes, NY 06.20.07, 2:50 PM ET

Parmy Olson

LONDON - Alcan may be in search of a white knight. The Canadian aluminum producer has opened its books to mega-miners Rio Tinto and BHP Billiton in an attempt to fend off a $27 billion offer from American rival Alcoa, according to a report in The Sydney Morning Herald Wednesday.

Shares in BHP Billiton (nyse: BBL - news - people ) closed up 19 pence (38 cents), or 1.4%, at £13.84 ($27.57) Wednesday in London, while Rio ended the day 65 pence ($1.30), or 1.7%, lower at £38.38 ($76.54).

It would be no surprise for potential acquirers of Alcan (nyse: AL - news - people ) to have stepped in--not only would an Alcan-Alcoa union create the world's biggest aluminum producer, but if either BHP or Rio Tinto (nyse: RTP - news - people ) had considered buying Alcan before, now could be their last chance with the miner in play.

Shares in Alcoa (nyse: AA - news - people ) had spiked on Monday after a Times of London report that BHP was considering reviving a planned $40 billion bid for Alcoa. (See "BHP Rumored To Eye Alcoa, Alcan.") But prior to that, Billiton has reportedly entered early-stage discussions with Alcan, according to a May 23 report in Canada's Globe and Mail newspaper.

A BHP bid for Alcan makes sense because the aluminum operations of both companies would complement each other. Alcoa, for instance, has substantial downstream manufacturing operations, including an aluminum foil business.

But Gavin Wendt of market analyst Fat Prophets believes BHP wouldn't be able to extract the same kind of value from a takeover of Alcan that Alcoa could. "Any bid that BHP could mount, Alcoa could top, because there would be greater benefits flowing to them from a tie-up," he told The Associated Press.

Still, BHP Billiton will more than likely take part in the merger and acquisition activity gripping the metals sector. It named internal candidate Marius Kloppers, president of Billiton's non-ferrous materials group, as a successor to outgoing Chief Executive Chip Goodyear. Kloppers was behind Billiton's last major acquisition, the 2005 purchase of copper and uranium miner WMC Resources.

BHP and Rio Tinto have declined to comment on the Herald report about Alcan.

Outotec wins 4 aluminum technology orders from Chinese companies

ABCmoney.co.uk, UK Wed, 20 Jun 2007 07:53

HELSINKI (Thomson Financial) - Outotec said it has won four aluminum technology orders from Chinese aluminum smelters, but did not disclose the value of the deals.

Two of these contracts are for turntable anode vibrocompactors that will be delivered to Gansu Hualu Aluminum Co Ltd and another unnamed costumer.

The third deal is a repeat order from Henan Wanji Aluminum Co Ltd for the supply of two sow casting systems.

The fourth deal is from Qingtongxia Qingxin Fangyuan Carbon Co Ltd for the supply of one vibrocompactor for the expansion of graphitized cathode production.

Deliveries of the vibrocompactors are set to be completed before June next year from Germany, while the casting systems are set for delivery next February.

azer.sawiris@thomson.com

China may swallow mining major to satisfy ore appetite

Business Report, South Africa - June 20, 2007

By Karen Norton

London - China may yet target a mining major as it scours the world for natural resources to feed booming domestic demand for raw materials to satisfy infrastructure needs.

Its strategy may also speed the emergence of Chinese mining firms big enough to compete with major western counterparts, analysts say.

China is the top producer and consumer of many metals and has bought into numerous mine projects or smaller firms in recent years, including copper, bauxite and iron ore.

"There's definitely a short-term strategic requirement, but there's a wider political dimension," independent consultant Angus MacMillan said.

"There's an element of central planning, China is looking to control a large proportion of natural resources on a long-term basis."

He said the country was looking at where it stood in the global picture and deciding where it wanted to be. "We're seeing the next global empire."

Magnus Ericsson, a senior partner at Stockholm-based consultancy Raw Materials Group, said consolidation in China's metals industry would ultimately create big companies there, which in turn would look overseas.

"This is the first ripple on the surface of a big wave," he said.

Most saw the buys as symptomatic of China's tendency to plan, looking to feed its needs in the long term.

Aluminium Corporation of China (Chalco) last week bought Peru Copper, giving it an option on a big project that may start up around 2010.

China said in March it was creating an investment vehicle to diversify part of its $1.2 trillion (R8.5 trillion) in foreign reserves. Part of the $200 billion fund is expected to be invested in commodities, given China's lack of many key resources, including oil.

Chinese firms have invested heavily in Australia, Africa, Latin America and parts of Asia, often in countries shunned by western firms due to perceived high political risk.

"I don't think they've done anything untoward in terms of controlling the supply. They have a strong economy and need those resources," said Andrew Cole, a director at Baring Asset Management.

Andrew Keen of Bernstein Research said: "The Chinese want to supply their domestic requirements and no more than that. Every time they cross that path you see government policy come out against it."

Cole said Chinese firms had long-term plans. "The West will pay the price of that at some stage," he added.

Lex Hoogduin, the chief economist at Dutch asset manager Robeco, thought the $200 billion fund could be invested using private equity.

"The private equity fund will make a selection of companies to invest, but they will probably also gradually buy some equities of miners," he said.

Stockholm-based Ericsson said: "It can't be far off a company like Minmetals buying a major company. It's a bit speculative, but a bid for Anglo American is possible later this year."

Minmetals, China's largest state-owned metals trader, failed in 2005 in a bid for Canada's Noranda, whose operations are now owned by Xstrata. Last month Minmetals said it planned to boost investment in Latin America.

Others think aluminium majors Alcoa and Alcan might be looked at by Chalco. There has also been recent talk of Chinese interest in BHP Billiton, the world's largest mining group.

Chinese firms have already bought iron ore companies in Australia to satisfy fierce steel industry demand.

China produced just over a third of global crude steel output last year and accounted for 43 percent of imports of iron ore for steel products. - Reuters

INTERVIEW - Dubal sees delay in Orissa bauxite alumina project

Reuters India, India - Sat Jun 23, 2007 11:01 PM IST

DUBAI (Reuters) - State-owned smelter Dubai Aluminium Co. (Dubal) will not be able to start a $3.6 billion bauxite alumina project in Orissa in 2009 due to bureaucratic issues, a Dubal official said on Saturday.

"Due to the bureaucratic shape in Orissa and negotiations and papers we have to go through, there will be a delay on the start-up of the project, but it is hard to say how long the delay will be," Khalid Essa Abdullah Buhumaid, a Dubal general manager, told Reuters.

"However, the team who is in charge of this project is working very hard to bring it up to the speed and not to cause any further delays".

The bauxite mine and alumina refinery and smelter is a joint venture between Dubal and India's Larsen & Toubro. The United Arab Emirates' firm will hold a 74 percent stake in the project, while the Indian engineering and construction firm will hold the rest.

Phase one of the facility will have a 1.5 million tonne output capacity and cost $1.1 billion to build.

Phase two, involving an aluminium smelter, will add another 1.5 million tonnes per year of alumina at a cost of $2.5 billion, but Buhumaid did not say when it would be finished.

Dubal aims to be among the world's top five aluminium producers in five years. Its only competitor in the Gulf Arab region is Aluminium Bahrain (Alba) with an aluminium output capacity of 830,000 tonnes a year.

The smelter's main source for alumina is Australia, but it is looking for more suppliers and also targeting joint ventures with low-cost alumina producers to protect itself from price fluctuations.

"We are looking at different options all over the world... we are in discussions with a number of parties," Buhumaid said.

In May, Dubal, Abu Dhabi government investment agency Mubadala Development Co. and Australia's BHP Billiton bought two thirds of the Global Alumina project in Guinea that includes mining for bauxite and building a refinery to make alumina, or semi-processed bauxite.

The refinery, which will be complete as early as 2009, will have capacity of 3 million tonnes a year of alumina, Mubadala said.

Dubal produced 861,000 tonnes of aluminium in 2006, used mainly in construction, transport and the electrical industries.

"In 2007 our total production is expected to reach 895,000 tonnes," Buhumaid said.

Dubal produces primary aluminium, value-added products including foundry alloy for automotive wheels, extrusion billet for construction purposes and high purity aluminium for the electronics industry.

It has announced plans to build an $8 billion aluminium smelter complex, which would start operations in 2010. The project would raise its output capacity to 1.4 million tonnes a year making it the world's largest.

Russia's Rusal operates the world's biggest smelter, at Bratsk, with a capacity of 976,000 tonnes per year.

© Reuters 2007. All Rights Reserved.

Kaiser Alumninum makes Russell 2000

Los Angeles Business, CA - - 9:09 AM PDT Monday, June 25, 2007

Kaiser Aluminum Corp. was added to the Russell 2000 index on Monday.

Russell indexes are widely used by investment managers and institutional investors for index funds and as benchmarks for both investment strategies.

Annual reconstitution of the indexes captures the largest U.S. stocks as of the end of May, ranking them by total market capitalization. The largest 1,000 companies in this ranking comprise the Russell 1000 and the next 2,000 companies become the Russell 2000.

"Inclusion in the Russell 2000 index will further enhance the company's visibility with investors and institutions, and therefore add value to the company and our shareholders," Jack A. Hockema, chairman, president and CEO of Kaiser Aluminum, said in a statement.

Foothill Ranch-based Kaiser Aluminum (NASDAQ: KALU) produces fabricated aluminum products for aerospace and high-strength, general engineering and automotive and custom industrial applications.

Aluminum Duties to Be Cut

The Moscow Times, Russia Bloomberg Thursday, June 28, 2007. Issue 3687. Page 6.

A government commission on Wednesday called for the import duty on primary aluminum to be cut and for the duty on aluminum alloy to be lowered to 10 percent of the good's declared price from 20 percent.

But the commission, chaired by Economic Development and Trade Minister German Gref, postponed a decision on whether to change the sugar import duty, his ministry said.

The government's Commission for Protective Measures in Foreign Trade, which discussed raising the tariff in working groups over the past few months, postponed its decision on sugar until July, the ministry said in an e-mailed statement.

The import tariff has been at $140 per ton since October 2004.

The government will keep import duties on mobile telephones at the level of 5 percent of their declared price. The commission also voted to lower the duty on video game consoles to 10 percent from 20 percent.

The import tariff on digital cameras will be canceled for nine months, according to the ministry.

The Cabinet must approve the recommendations of the commission for the new import duty levels to come into effect. The process normally takes several months.

Quebec, aluminum companies agree to cut gases

CBC Montreal, Canada Wednesday, June 27, 2007 | 3:15 PM ET

The Quebec government has signed a deal with three major aluminum producers that will require them to reduce total greenhouse gas emissions by two per cent in the next five years.

Alcan Inc., Alcoa and Aluminerie Alouette have agreed to cut their collective carbon dioxide emissions by 150,000 tonnes by 2012. The companies currently produce more than seven million tonnes of CO2 a year.

Canadian Aluminum Association president Christian Van Houtte said the five-year commitment goes beyond the voluntary emission reductions many companies already try to respect.

"We've got a lot of positive sides to the production of aluminum and we want to be better," he told CBC News on Tuesday.

Quebec Environment Minister Line Beauchamp said the aluminum industry has been a leader in reducing emissions, having doubled its production since 1990 while cutting CO2 production by seven per cent.

The province hopes to draft similar agreements with other industrial sectors.

Alcan awards modernization prelim contract

Northern Sentinel, Canada - Jun 27 2007

The awarding of a multi-million dollar contract is a clear sign of Alcan’s commitment to modernization, says Paul Henning.

Henning, whose new title is managing director of BC Operations, announced the contract with ABB Group last Thursday at the opening of a modernization project infocentre in the upper City Centre Mall.

ABB will be paid $8 million for preliminary engineering work on a new substation at the smelter.

"This is a significant step forward," Henning said, describing the work as "a key step in our project development, it’s a fundamental piece."

Henning explained the power requirements for the new plant were completely different from those of the existing smelter - for example the amperage would be three times higher - and the current substation simply wouldn’t be able to handle it.

However, he reminded those present that modernization still depended on meeting the three conditions laid out when the project was first announced.

The first - a long term contract with the union - had been achieved last month.

On environmental approvals, Henning said he was pleased to say that the company was actually ahead of where it had expected to be with federal Fisheries and he hoped that condition would be finalized in the next few weeks.

Which left only a new power sales agreement with BC Hydro, a replacement for the one the BC Utilities Commission rejected last December as not being in the public (BC Hydro customers’) interest.

Reminded that it was seven weeks since Jean Simon, president of Alcan Primary Metal’s North American division, had said a new agreement was only days away, Henning admitted, "It’s been frustrating, it’s taken longer than we thought."

However, he added, the main thing was to "get it right" this time.

The province having updated its energy plan this year, Alcan and BC Hydro had to ensure any deal meshed with that and was one in which they also had the "highest confidence" in terms of BCUC approval.

"We’re only going to have one more chance at this and if we don’t get a contract in place that is BCUC approved, then the risk [of not going ahead] is high," Henning noted.

And in that regard, he had a message: "Regardless of how we feel about power in all its fullness, I think we can come together on the modernization, on the actual plant itself. Let’s support the modernization.

"The biggest thing we can do together as communities and as people would be to support Alcan and the modernization through the BCUC process."

Dismissing rumours that the provincial government was holding things up on the BC Hydro deal, Henning also played down the impact of takeover talk. On the latter, he said CEO Dick Evans, Primary Metal boss Michel Jacques and Simon had all given him the same message: "business as usual - and business as usual means the progression of the project."

Pointing out the contract award meant Alcan was moving forward on aspects of the project even without all three conditions being met, he said that meant the company was taking on a degree of risk.

"By bringing sessions together like this today, we hope to show you how confident we are in moving forward," he added.

If the modernization does proceed, ABB will also construct the substation, a 22-24 month job. Henning said he was unable to release that price tag.

Those on hand for the announcement included members of both Kitimat and Terrace councils, Skeena MLA Robin Austin, KTIDS president Bill Eynon and Chamber president Pauline Maitland.

Kaiser Aluminum Sets Dividend

Houston Chronicle, United States June 27, 2007, 9:28AM

© 2007 The Associated Press

FOOTHILL RANCH, Calif. — Aluminum producer Kaiser Aluminum Corp. on Wednesday declared an initial quarterly dividend of 18 cents per share.

The company will pay the dividend on Aug. 17 to shareholders of record on July 27.

Kaiser Aluminum said the move reflects its confidence in its financial strength.

Shares of the company shed 87 cents to $72.12 in morning trading.

China`s Xinfa builds US$394m alumina plant

Mining Journal Online, UK - June 29, 2007

Guangxi Province, China

Shandong Chiping Xinfa Group is building a Yu3 billion (US$394 million) alumina project in the southern Chinese province of Guangxi, according to news agency Beijing Antaike Information Development Co.

Construction started in April and the plant may start producing at the end of 2008, Antaike said in a monthly report e-mailed to Bloomberg on Friday, citing executives it did not name.

The refinery, which has a capacity of 1.6 Mt is located in Jinxi county, near Vietnam, it said.

Shandong Xinfa is in talks with Vietnam for bauxite imports as it seeks to reduce reliance on Indonesian supplies, the report said.

The refinery will be built on a so-called greenfield site that was not previously developed, it said.

Shandong Xinfa, which is closely held, is the second-largest alumina producer in China after Aluminum Corp. of China Ltd.

(June 29 Bloomberg)