AluNews - October 2009

Siemens to supply reversing rolling mill to Chalco North East Light Alloy
SteelGuru - Thursday, 01 Oct 2009
Chalco North East Light Alloy Company Ltd, a subsidiary of the Aluminium Corporation of China, has ordered a single pass reversing finishing mill with twin coiler from Siemens VAI Metals Technologies.
The mill is part of a hot and cold mill expansion which will be erected in Harbin. The order is worth some EUR 13 million and includes key electrical and mechanical components together with the automation and process technology. The new rolling mill is scheduled to start production in August 2011.
Chalco North East Light Alloy Company Ltd based in Harbin in the northern Chinese province of Heilongjiang, produces plate and sheet, strip, foil, tube and pipe from aluminum, magnesium and aluminum magnesium alloys. The company's products are used mainly in aviation, transport and communication as well as the electronics and lighting industry.
The new reversing mill will increase Chalco NELA annual production capacity by 210,000 tonnes of strip and allow production of end products of increased hardness and reduced thickness at enhanced quality levels. The plant has been designed for rolling strip with a width of up to 2,100 millimeters at a speed of up to 363 meters per minute.
The finishing mill comprises a 4 high stand with automatic hydraulic gauge control as well as positive and negative work roll bending. Siroll ISV Sprays are used for spray cooling. In addition to the mechanical equipment, Siemens will be supplying the entire automation system and the drive technology for the rolling mill, including Sinamics SM150 medium-voltage converters and Sinamics S120 low-voltage converters, as well as thickness and profile measurement systems and the sensor technology. The automation system embraces the basic automation, including the technological controllers and the operating and monitoring equipment.
The scope of supply also includes the process automation equipment for the entire hot strip mill, which also comprises a reversing roughing mill to be supplied by a local vendor. This degree of system compatibility ensures a consistently high product quality. All the systems and components belong to the "Siroll Alu" integrated solution platform from Siemens for aluminum rolling mills. Siemens will also be responsible for commissioning the plant and training the customer's personnel.

Workers begin search for new jobs as Anglesey Aluminium closes
Daily Post - Oct 1 2009 By Owen R Hughes
HUNDREDS of workers will start a search for new jobs today after the power switch was turned off on the Anglesey Aluminum smelter.
Workers on the two pot lines left their final shifts amid sadness and anger that nearly 40 years of smelting has come to an end.
They voiced fears about their futures as they struggle to find new work.
Ian Connolly, 39, a senior pot line worker from Valley, said: "I came here today as my family’s main breadwinner and left it on the dole."
Paul Jones, 35, from Bangor, said: "They had a fire here last summer and now I think they should have pulled the plug then. We worked so hard to get this plant back to full production and then they shut it down, it is a sad day."
Gareth Owen, 60, of Llanfaethlu, said: "I have been here 23 years but never did I expect to be here when they switched off the power."
Nigel Watkinson, 49, of Bangor, who has worked at the plant for 22 years, said: "Where am I going to go now? I have been looking for weeks but there is nothing out there, it is very sad and we will miss this place."
The plant turned off the power after the failure to sign a new electricity deal beyond September 30 despite a £48m sweetener from the UK and Welsh Governments. A re-melt business will remain, employing 80 of the 540 staff that were at the site.
Chris Williams, 44, from Valley, said: "The company has given us a good living over the years and it is sad that it has come to an end.
"There is no bad feeling from me though towards the company."
Dewi Roberts, treasurer of the We Care workers’ charity, which has raised £91,000 for good causes, said: "I don’t blame the company, I blame the Government for not dealing with the power issue 10 years ago by allowing a gas powered station to be built on Anglesey."
Anglesey MP Albert Owen is now calling on the parent companies Rio Tinto and Kaiser Aluminium to provide the area with a substantial cash legacy and wants the Assembly to give special attention to the island’s economy. He is also demanding a specific recovery plan to be set out.
He said: "We need more than just warm words we need action and hard cash."
He added: "We need specific plans in place and the island to be given ‘special status’."
A fast track job search team has been set up in Llangefni JobCentre Plus for workers from Anglesey Aluminum. There will be 10 staff on hand to support workers.
Noranda Aluminum returns to full capacity
Southeast Missourian -Thursday, October 1, 2009
By Jill Bock ~ Standard Democrat
MARSTON, Mo. -- Noranda Aluminum, one of the largest employers in Southeast Missouri, is returning to full production, Gov. Jay Nixon said at a ceremony Wednesday.
On a stage set up in front of the plant's administrative office, Nixon was accompanied by officials from both political parties, members of the United Steelworkers Local, officials from Noranda Aluminum Inc. and officials from Jamaica, where the bauxite used to produce aluminum is mined.
Nixon said the company has suffered from a global decrease in the price of aluminum and steep increases in the cost of production. Another blow came during the January ice storm, when power outages reduced the plant's production capacity by nearly 80 percent for weeks.
On Monday, Nixon said, the plant will "rev back up to full throttle" as it restarts its third production line. The company has rehired 38 laid-off workers; it employs about 900 total.
The governor also announced a $2 million job retention training program along with $1 million in stimulus funds to provide for upgrades at the plant.
"To compete in the 21st-century economy, it's absolutely vital that Missouri workers have access to up-to-date, innovative job training," Nixon said. "I am pleased that we have reached this agreement to help enhance the knowledge and skills of Noranda's workers, while providing critical resources to help keep this major employer right here in our state. This agreement is good for Noranda, good for the steelworkers here in the Bootheel and good for our entire state."
The Missouri Division of Workforce Development will invest the $2 million to provide customized and detailed training to Noranda workers in a variety of areas, including computer skills, industrial maintenance, carbon processing manufacturing procedures and safety. To cover the costs of the training, a portion of the monthly withholdings tax collected by Noranda will be diverted to pay for instruction and materials. Three Rivers Community College will operate the program.
Bud Joyner, Three Rivers director of career education and workforce development, said the college also hopes to deliver much of the training. Already Three Rivers is providing some of the technical skills training on the company's new equipment and will begin providing safety training for workers.
The $1 million Community Development Block Grant, funded by the federal stimulus package, will help the aluminum company continue upgrades. Noranda plans to spend a lot to upgrade and modernize its production operations, and the funds will assist the company in retaining jobs throughout the process.
The funding, in the form of a forgivable loan, was made by the Missouri Department of Economic Development to New Madrid County, which in turn awarded the funds to Noranda. If Noranda maintains the jobs for 10 years, the loan will be forgiven.
Nixon's administration is working on other incentives for Noranda, including development tax credits and additional grants, according to a new release from Nixon's office. The total package is expected to total about $8 million.
New Madrid County Presiding Commissioner Clyde Hawes said the announcements were good news.
"Maybe now employment might get back to normal," he said.

Mr. Richard B. Evans joins CGI Board of Directors
PR Newswire (press release) - MONTREAL, Sept. 30
CGI Group Inc. (TSX: GIB.A; NYSE: GIB), a leading provider of information technology and business process services, announced today that Mr. Richard B. Evans, has joined the CGI Board of Directors.
"We are very pleased to welcome Dick to the CGI Board of Directors," said Serge Godin, Founder and Executive Chairman. "His vast experience in the global market place will contribute to the execution of our strategy. I look forward to collaborating closely with him towards the realization of CGI's goals."
Mr. Evans is the recently retired CEO of Rio Tinto Alcan and former CEO of Alcan, and is current Chairman of the Board of the International Aluminium Institute and past Chairman of the U.S. Aluminum Association. A graduate of Oregon State University with a Bachelor's degree in engineering, he also holds a Master's in management from the Stanford University Graduate School of Business.
About CGI
Founded in 1976, CGI is one of the largest independent information technology and business process services firms in the world. CGI and its affiliated companies employ approximately 26,000 professionals in over 100 offices across 16 countries. CGI provides end-to-end IT and business process services to clients worldwide from offices in Canada, the United States of America, Europe, Asia Pacific as well as from centers of excellence in North America, Europe and India. CGI's annualized revenue run rate is currently $3.8 billion and as at June 30, 2009, its order backlog was $11.8 billion. CGI's shares are listed on the TSX (GIB.A) and the NYSE (GIB) and are included in the S&P/TSX Composite Index as well as the S&P/TSX Capped Information Technology and MidCap Indices. Website:

Stalled Talks Strain Alcoa: Operation Restart Hinges on New TVA Contract,
Knoxville News Sentinel - October 02, 2009
By Ed Marcum
Alcoa's North Plant in Blount County is a model of mechanical efficiency, milling slabs of aluminum nearly as heavy as a tractor-trailer rig down to sheets that are thousandths of an inch thick.
The only glitches interfering with Alcoa's production metrics are a weak economy and stalled power contract negotiations with TVA.
In March, Alcoa completed the shutdown of a smelting operation at its adjoining South Plant, laying off 450 workers, when global demand for aluminum dropped.
As Alcoa juggled fluctuating market conditions, the company has been negotiating with TVA for two years on a long-term power contract to replace one that will expire in June.
Restarting the smelting operation hinges on an economic upswing and a new power contract, said Christy Newman, Alcoa spokeswoman.
"We still need for metal prices to go back up, but there is no way we can get the smelter back in operation and the 450 employees back to work without the TVA contract," she said.
The economy and the stalled negotiations also have put a hold on some of 12 capital improvement projects totaling $850 million that Alcoa has planned, according to Newman. Included are $300 million in upgrades at the smelting operation involving furnace rebuilding, new computer control, material handling systems and sustaining capital.
Alcoa has managed to complete a major capital project at its North Plant -- limited operation of one of two new 1,200-ton pusher preheat furnaces since July. Each furnace is a $42 million investment intended to boost efficiency, safety and cut waste.
The North Plant's role is to turn 44,000-pound slabs of aluminum, called ingots, into sheets for making beverage cans. To start the process, the ingots must be heated from room temperature to about 1,000 degrees to make them pliable to be worked by machinery.
Until the pusher preheat furnaces were installed, Alcoa, which began operating in 1942, used the same box furnaces installed in about 1941, said Jeff Weida, hot line manager at the North Plant. The older furnaces heat eight ingots at a time, stacked horizontally like a deck of cards. A typical ingot is about 23 feet long, 21 inches thick and weighs about 44,000 pounds.
Because heat rises, the ingots at the bottom of the stack cool more quickly than those above, and they tend to bow in the middle.
"You can have a temperature variance of plus or minus 100 degrees from one ingot to the next," Weida said.
Bowed ingots have to be worked back and forth on rollers until they are flat enough to enter the milling operation.
The process holds up production time and grinds off slivers from the ingot, wasting material as well, Weida said.
A pusher preheat furnace has several advantages, he said. It can hold 48 ingots, stacked vertically so they don't bow. It discharges them one at a time ready to roll right into the hot line, where two reversing mills and a five-stand mill gradually squeeze the 21-inch slab into a one-eighth-inch-thick coil that is pressed even thinner on the cold rolling line.
The one pusher preheat furnace has allowed the plant to take about 10 of its 27 box furnaces off line, Weida said. "Instead of about 128 ingots a day, we are able to process about 192 a day now," he said.
With its smelting operation idled, Alcoa is relying more heavily on its can-reclamation process at the North Plant for aluminum.
"With two (furnaces) we could be that much more effective, that much more efficient, but you know, it takes money to make money," Newman said.
Right now, a lot of Alcoa's revenue-producing capability hinges on getting a good power contract with TVA, she said.
"There are $850 million in capital improvements we have planned for the next 10 years, but a lot of it hinges on the fate of that South Plant," she said.
Alcoa is able to produce 40 percent of its power needs through its system of four dams, but the rest comes from TVA. Without a favorable power rate from TVA, Alcoa will not be able to restart the smelter and return its employees to work, Newman said.
Brett McBrayer, manager of Alcoa's Primary Metals division, has said the future of the smelting operation grows uncertain without the power contract.
Newman said negotiations with TVA have been going on since 2007 but that the parties simply can't agree on cost. According to Alcoa, its power rate at the South Plant is among the highest 15 percent for smelting operations in the nation. Specifics of the TVA contract were not disclosed.
"Alcoa has long been a valued customer of TVA's, and we are working diligently to reach agreement on a long-term power contract for the future. While these contract negotiations are confidential, we are working to reach an agreement that will allow Alcoa to operate its Tennessee facility while, at the same time, not disadvantaging other Valley ratepayers," TVA spokesman Jim Allen said in a statement.
Newman said she believes both sides would like to reach a contract, noting that Alcoa is one of TVA's largest customers. "We believe TVA has a vested interest in this just as we do," she said. "We are going to push for a resolution to this by the end of the year."
Business writer Ed Marcum may be reached at 865-342-6267.

NALCO to build USD 1.2 billion alumina refinery
SteelGuru - Monday, 05 Oct 2009
Aluminium Today reported that Indian aluminium manufacturer Nalco is to invest USD 1.2 billion to build an alumina refinery in Andhra Pradesh of southern India.
The group has obtained government approval to manage a bauxite mining complex near the refinery. It plans to build the 1.4 million tonne per year refinery so that its total production capacity will increase to 2.1 million tonnes.
According to Nalco, bauxite reserves at the new mines total 85 million tonne. The majority of the alumina produced at the site will be processed into aluminium at Nalco’s existing smelter while the rest will be exported.
(Sourced from

Rio Tinto to sell Ghana bauxite mine
Reuters - Mon Oct 5, 2009 2:52pm EDT
ACCRA, Oct 5 (Reuters) - Rio Tinto (RIO.L)(RIO.AX) is selling its 80 percent stake in Ghana's only bauxite mine to Chinese minerals group Bosai, Rio said on Monday.
The London- and Sydney-listed firm has shelved an earlier plan to develop an integrated alumina refinery which would have been fed by the Awaso mine, as a result of poor local infrastructure and lower global demand for minerals.
"Apart from the prevailing unfavourable market conditions, the infrastructure is not ready yet for that programme ... the cost of power and the supply system has to improve," Rio spokesman Stefano Bertolli said.
The mine in the West African country produced 637,000 tonnes of the aluminium raw material, according to the firm's website.
The sale to Bosai, which produces alumina and aluminium in China, will be complete by the end of the year and is subject to approval by Ghana's parliament, Bertolli said.
"After careful consideration of various options, accelerated by a period of very tough economic market conditions, we decided to pursue sale of our share in GBC," he said, declining to identify the value of the sale.
By contrast to Awaso, Rio Tinto last year received 45 percent of output from the Sangaredi bauxite mine in nearby Guinea, amounting to almost 6 million tonnes.
Ghana's main mineral export is gold, of which it is Africa's second biggest producer. (Reporting by Kwasi Kpodo; Editing by Daniel Magnowski and Jim Marshall)

DJ Brazil Miner Vale Seeks Stake In Power Dam
Trading Markets (press release) - Tue. October 06, 2009
RIO DE JANEIRO, Oct 06, 2009 (Dow Jones Commodities News via Comtex
Brazil mining company Vale SA (VALE) is looking at taking part in a consortium to build the Belo Monte power dam in the Lower Amazon region, the Valor newspaper reported Tuesday.
Vale's likely consortium partners would be GDF Suez SA (GSZ.FR), Brazil electricity company CPFL Energia SA (CPL) and Neoenergia.
Contacted by Dow Jones, Vale said it would not comment on the report.
Belo Monte in Para State, northern Brazil, will generate 4,600 megawatts, and would likely cost up to 30 billion Brazilian reals ($17 billion), Valor reported.
According to the report, Vale's interest in taking part in the dam would be to guarantee a 20% share of the electricity produced, around 920 MW, to smelt energy-hungry aluminum at its Albras and Alunorte plants in the region.
Vale currently consumes 4% of Brazil's energy supply and is constantly seeking to generate more of its own electricity.
Although the Belo Monte site is still awaiting environmental licensing, an auction for the project is expected this year, Valor said.
Valor also said a rival consortium also hopes to build the dam.
The second consortium would likely be made up of Brazil construction companies Grupo Odebrecht, Andrade Gutierrez and Camargo Correa.
-By John Kolodziejski, Dow Jones Newswires; 55-21-2586-6086;

Nanotubes make aluminium nearly as strong as steel
Eureka - 06/10/2009
By adding agglomerations of carbon nanotubes to aluminium using powder metallurgy, it is possible to achieve tensile that almost match those of steel.
The claim is made by Dr Horst Adams, vice president future materials at Bayer MaterialScience, which makes 'Baytubes' - agglomerates of multi-wall carbon nanotubes produced in a catalytic process based on chemical vapour deposition.
Dr Adams explained: "Previously, it has only been possible to assign mechanical properties of this kind to aluminium by adding rare and expensive metals in a complex alloying process. In addition to improving strength, nanotubes can also enhance impact strength and thermal conductivity."
The nanotubes have an outer mean diameter of about 13nm and inner mean diameter of about 4nm, yet are more than 1µm long. Bulk density is 130 to 150 kg/m3. A pilot plant in Laufenberg, Germany, has been able to produce 60tonnes per year. An additional pilot facility with an annual capacity of 200tonnes is currently under construction at Leverkusen.
The aluminium based materials are being developed in conjunction with Zoz GmbH in Wenden.
Author Tom Shelley
Supporting Information

New name coming for St Ann Bauxite
SteelGuru - Thursday, 08 Oct 2009
Jamaica Gleaner reported that St Ann Jamaica Bauxite Partners is to undergo a name change following Noranda Aluminum's acquisition of shares previously held by Century Aluminum a month ago. The acquisition gave Noranda 49% shares and management responsibility of the bauxite entity.
A spokesperson at SAJBP said that The Gleaner on October 3rd 2009 that the company was accepting ideas for a possible new name. It's quite possible we will have a name change as the company is now accepting logos from employees.
The company has also reverted to its 40 hour workweek for its 580 strong workforce as it aims to boost production by 25% beginning within a 3 month period. Earlier this year, in streamlining its operations as the economic crisis took a hold of the industry, SAJBP made several positions redundant and cut the work time of remaining employees by three days per month.
In making the announcement of the acquisition of shares and plans for a bauxite production boost on September 2nd 2009, Mr Larry Holley president of SAJBP said that the export figure for the next 12 months would be 4.2 million tonnes up from the initial projection of 3.1 million. He said that increase in production to meet the new target would begin in 3 months meaning at the start of December.
A source at SAJBP said that while the current production level could not be confirmed, the company was on target to meet the 90 day deadline to increase production to the required level in order to meet the new target. The source said that "Everything is in order, things are moving smoothly."
Meanwhile, efforts to get an update on the proposed reintroduction of bauxite mining in South East St Ann, proved unsuccessful.
It was announced over a year ago that a feasibility study was being done for Mincenco a holding company comprising China Minmetals, Century Aluminum and the Jamaican government, to mine bauxite in the constituency, covering areas such as Moneague, Lumsden, Lydford, Golden Grove, Claremont, Higgins Town and Colegate.
In 2008, at a community meeting in Claremont, Ms Lisa Hanna Member of Parliament for South East St Ann told residents that some of whom had voiced concerns about the negative environmental impact the project would have on the area that only a prospecting licence was granted. The Gleaner last week that there was no new development and she was still awaiting an update on the project from the Ministry of Mining.
(Sourced from

Venezuela's CVG-Bauxilum to get +US$85.5 million in recovery bid - 07-Oct-09
Business News Americas (Harvey Beltran): Venezuelan bauxite and alumina producer Bauxilum has signed an agreement with state-owned development bank Bandes and the Chinese-Venezuelan joint fund to access 100 million bolivares (US$46.5 million) and US$39 million for the company's recovery.
"This money will be invested under worker supervision and we believe that with this we can start the urgent work the plant needs in order to recover," Jose Sanchez, spokesperson for the company's Sutrapubal union, told BNamericas.
According to Sanchez, the fact that workers will now be given a say in where the funds will be spent is the most important part of the agreement.
The lack of investments in technology upgrades in Bauxilum has drastically lowered the company's production. In September Bauxilum suspended part of its sales to international clients to favor local buyers.
Bauxilum previously presented a recovery plan to the basic industries and mining ministry (Mibam) calling for an investment of nearly US$91mn to save the company.
The company has already reduced its production goal for this year from 1.7 million tonnes to 1.4 million tonnes of alumina due to technical and economic difficulties.
Bauxilum operates a 2 million tonnes per annum alumina plant in Guayana region's Puerto Ordaz city. Its local clients are aluminum reducers Alcasa and Venalum.

GCC to become a global hub for aluminium
Emirates Business 24/7 - Thursday, October 08, 2009
By Nissar Hoath
The GCC is to become a global hub for aluminium production with 25 per cent global smelting capacity going online in five years, according to a business research and consultancy firm.
Talking to Emirates Business on the sidelines of the first Middle East Growth, Innovation and Leadership Summit (GIL 2009), Aditya Sapru, a partner at Frost and Sullivan, the organisers of the summit, said the GCC is fast diversifying with mega investments in cluster industries, particularly in metal and petrochemical byproducts.
"This region is full of potential for growth. There is potential today as the region is turning around with a huge interest in diversifying. There is also rise in the strength of sovereign wealth funds in the region. This region in five years will have 25 per cent global aluminium smelter capacity," he said.
Sapru said the region, along with other states in the Middle East and North Africa (Mena), will become a aluminium smelter hub in terms of capacity because of the availability of low cost energy. The region also holds the potential of becoming a world leader in Islamic banking, Sapru said.
"This region is going to be a powerhouse of Islamic banking as there is huge potential for such products. In petrochemical and metal products, the region is already gearing up with a number of cluster industries in countries such as the UAE and Saudi Arabia."
Sapru said there has always been a wrong notion that the Middle East was wholly dependent on oil and gas production. The contribution of the non-oil sector to the regional countries' GDPs was greater than oil income, he said.
According to report obtained by Emirates Business at the summit, the Middle East, particularly the GCC, is the world's fast recovering region from the global economic crisis due to strong economic policies and the role of sovereign wealth funds.
The report said:"With competitive dynamics at its helm, the Middle East states are focusing on diversification plans. At this juncture, it is to Middle East's credit that they have decided to focus on the aluminium industry to alleviate the impact of their primary dependence of a single resource of income."
According to the report, as of 2008, the aluminium industry employed more than a million people and indirectly provided job opportunities to almost four million people.
The global demand for aluminium, the report said, is expected to be at seven per cent (compounded annual growth rate from 2009 to 2015) for developing economies and at two per cent for developed economies. "The Middle East governments' keenness for divestiture has furthered the position of region in the global aluminium market – the region is expected to contribute 15 per cent of the global production by 2015."
The report said the need to develop the aluminium industry in the Middle East is of utmost importance as domestic consumption is only 23 per cent of total production (in 2008). Of this 70 per cent are extruded products, that are used mainly in the construction sector.
"There is a large array of products and end-users, which are not traditionally targeted by Middle East producers. Thus there is an urgent need for these economies to invest in aluminium downstream industries, which can help them achieve long-term industrialisation plans to create a more diversified economy. It will also create employment opportunities and contribute significantly to GDP as well."
The GCC's share of global aluminium production is expected to increase by 150 per cent in 2010 due to significant investments in capacity expansion and ongoing construction of several new aluminium smelters.
Currently, the Gulf's two operating smelters are Dubal, which produces about 900,000 tonnes of a year, and Alba, with a capacity of 860,000 tonnes

Gladstone: industrial paradise or company town?
Le Monde diplomatique - 06-Oct-2009
by Mathieu O’Neil
It’s a pretty port, using local coal and bauxite to produce aluminium for export to China. The sun still shines and the sea is turquoise, but the price of commodities has dropped, Rio is shedding jobs and pollution is getting hard to ignore. ........................
Read the whole (long!) article at

Chinalco could participate in RUSAL HK IPO
Steelguru - Friday, 09 Oct 2009
Reuters reported that Chinese metals conglomerate Chinalco may be interested in acquiring a stake in UC RUSAL when the indebted Russian aluminium giant lists shares in Hong Kong.
Vedomosti business daily cited 2 unidentified banking sources as saying that Chinalco was a potential partner for UC RUSAL as the world's largest aluminium producer and its majority owner, industrial magnate Mr Oleg Deripaska seek to pay off debts.
The newspaper cited a third source close to UC RUSAL as saying that Chinalco was a possible investor.
As per report, Mr Vladimir Putin PM of Russia is due to visit China next week and is expected to sign a series of deals to boost business links between the 2 countries.
The sources said that UC RUSAL more than USD 16 billion in debt has re started plans for a stock listing in Hong Kong through which it hopes to raise between USD 1.5 billion and USD 2.5 billion by the end of 2009. They said that the company must first settle its debt restructuring plan with more than 70 international and Russian banks. UC RUSAL has said it plans to complete this long delayed process by the end of October.
(Sourced from Reuters)

Guinea ups the ante in row with Russia’s Rusal
Business Day - 2009/10/09
THE Guinean government in Conakry says it has enough evidence to launch a new court claim against Russian aluminium company Rusal, for at least 1bn.
A local court filing is expected shortly, sources in Conakry say, citing evidence of inflated costs and other alleged manipulation of financial accounts that have reduced taxes Rusal was obliged to pay in Guinea over some years.
At the same time, the Guinean government has decided to engage an internationally recognised accounting firm to analyse the internal financial accounts and also Rusal’s export declarations to support the court claim, and if warranted, increase it.
In Moscow, Rusal has responded with what appears to be a threat from the Russian government to punish Guinea in the United Nations (UN) if Rusal’s bauxite and alumina production in Guinea is penalised.
A report appearing in a Moscow newspaper last week warned that Russia might not issue its UN Security Council veto if a resolution imposing sanctions on Guinea for political rights violations is introduced for a vote.
"The diplomatic help of Russia is now very necessary to Guinea," the newspaper reports an anonymous source as claiming.
If the Guineans drop the financial claims against Rusal, the anonymous source reportedly claims, the Russian foreign ministry would consider vetoing a sanctions resolution against Guinea .
But foreign ministry spokesman Andrei Nesterenko told Business Day categorically there was no such linkage. "Like the diplomatic establishments of other countries, the Russian foreign ministry supports Russian business abroad," he said.
However, he said this did not mean that the foreign ministry would get involved in commercial disputes involving Rusal and Guinea .
A high-level Russian adviser on Africa policy in Moscow told Business Day the UN sanctions threat "sounds unreal", saying the situation was not on a big enough commercial scale to justify political intervention.
A Conakry court ruled a month ago in favour of a government application to revoke the privatisation of the Friguia refinery to Rusal’s benefit, on the grounds that the asset transfer violated local law and was priced at a fraction of the asset value.
A day later, the foreign ministry issued a statement saying that "without interfering with mutual relations of the Guinean authorities with its commercial partners, including … Rusal, it intends to watch closely the development of the situation".
The diplomatic help of Russia is now very necessary to Guinea

Trinidad in talks with Brazilian company on aluminum project
Caribbean Net News - Friday, October 9, 2009
By Matt Craze
SANTIAGO, Brazil (Bloomberg) -- The government of Trinidad & Tobago is in talks with a Brazilian company to build an aluminum smelter on the island, the country’s energy minister said.
The company seeks to build a smelter capable of producing 125,000 metric tons a year of the metal, Energy Industry Minister Conrad Enill said Wednesday in an interview in Buenos Aires. He declined to the name the Brazilian company.
"We are still in discussions with the Brazilian partner who has requested that we go ahead with it and we would make an investment decision by the second quarter of next year," Conrad said on the sidelines of the World Gas Conference.
Trinidad is seeking to attract energy-intensive industries such as aluminum makers interested in its abundant natural gas reserves. Alcoa Inc., the largest US aluminum producer, was interested in building an aluminum smelter in the Caribbean nation in 2006 before the project met environmental opposition.
Aluminum slumped 35 percent in the third quarter from a year ago after London Metal Exchange-monitored warehouses inventories more than trebled. Aluminum is used in airplane parts, automobiles and beverage cans. Enill said lower prices won’t prevent the government from pursuing the smelter.
Alcoa currently uses a deep-water port on the island to unload bauxite from mines in nearby Suriname to be distributed to its alumina refineries in Canada, Norway and the US. Bauxite is the raw ingredient that is refined to make alumina, the intermediary product needed to produce aluminum

Work moving on at La Brea plant
Trinidad & Tobago Express - Friday, October 9th 2009
Camille Bethel
Government is moving ahead with plans to build an aluminium smelter on the Union Industrial Estate in La Brea, although the Appeal Court is yet to decided on whether it can.
There is ongoing legal action on whether permission will be given to allow construction of the $703 million smelter.
But on Wednesday, Minister of Energy, Conrad Enill, told media at the World Gas Conference in Buenos Aires, Argentina, that the Government was in talks with a Brazilian company to build the smelter plant.
Enill's assurance was given in an interview with, a respected financial information website.
Government was left to foot the bill for the smelter after Venezuela-based aluminum producer Sural, which had a 40 per cent stake in the Alutrint aluminum smelter project, pulled out of the venture earlier this year.
Enill told international media, "We are still in discussions with the Brazilian partner who has requested that we go ahead with it and we would make an investment decision by the second quarter of next year."
He also told reporters that although aluminium prices had dropped by 35 per cent from what it was in the third quarter of last year, the lower prices would not stop the Government from pursuing the smelter.
The World Gas Conference is described as the most important global event for the gas industry, and is the culmination of three years of studies and programmes undertaken by 500 of the leading gas experts. The conference ends today.
Work on the Alutrint smelter was stopped after a June 16 High Court ruling by Justice Mira Dean-Armorer that quashed the EMA's Certificate of Environmental Clearance (CEC) to Alutrint.
Dean-Armorer's ruling stated that the EMA had failed to consider the cumulative impact of the smelter complex on the Union Industrial Estate, that they failed to enquire fully from Alutrint what they planned to do with the spent pot liners, and that there was lack of proper public consultation with the people of La Brea.
Hearing of the EMA's appeal to the ruling was heard yesterday and will continue tomorrow.

'Ship emissions not measured by Alutrint'
Trinidad & Tobago Express - Friday, October 9th 2009
Julien Neaves
SENIOR counsel Fyard Hosein has argued that Alutrint never measured the level of ship emissions associated with the proposed aluminum smelter plant and the potential hazards to the air and human health such a plant would pose.
Hosein, who is representing environmental group Smelta Karavan, was speaking yesterday at the Appeal Court on the fifth day of a civil appeal by the Environmental Management Authority and Alutrint, in which they are challenging a High Court ruling that halted the multi-million dollar smelter project in La Brea.
He said a Human Health and Environmental Risk Assessment was not done by Alutrint on the ships and port activity, and pointed out that these hazardous ship emissions included sulphur dioxide, nitrogen oxide and carbon dioxide. He also read from a report by EMA consultant Jacques Whitford, in which he stated that the ambient air study by Alutrint was on the main project only and not the other facilities. He noted that Whitford also found there was no description on what would be done to address this issue, no quantification of ship emissions and it was therefore "difficult to assess the impacts on the environment".
Hosein said another environmental issue that was not addressed was the transport of materials on the highway, and there was the risk of collision and spill of hazardous compounds.
Hosein explained that the Environmental Impact Assessment was also supposed to determine whether the particular geographic, ecological space and population's health would be able to accommodate a particular activity, the impacts on the flora, fauna, fish, residents and workers, and also had to state measures to mitigate and monitor these impacts.
He pointed out that the study area in the Environmental Impact Assessment included two schools, Vessigny High and Government Schools, and four communities, including Sobo and Union Estate.
He said if that information is not there "at the end of the day" and a Certificate of Environmental Clearance (CEC) was issued, that could be viewed as "irrationality" on the EMA's part, a term used by Justice Mira Dean-Armorer in her June 16 ruling that quashed the CEC.
Chief Justice Ivor Archie is presiding over the case together with Justices Wendell Kangaloo and Allan Mendonca. The hearing continues today.

Smelter might suffer under Aussie rules
Carbon News - Friday 9th October 2009
Rio Tinto's Bluff smelter ... disadvantaged?New Zealand operations powered by renewable energy - like the Rio Tinto aluminium smelter at Bluff - could be disadvantaged by plans to calculate average emissions levels with Australia under a new intensity-based scheme.
Climate Change Issues Minister Nick Smith told journalists in Wellington today that industry averaging data for the intensity-based calculation of emissions and units would be shared with Australia, which is taking a similar approach.

Indonesia may seek new partner for Antam and RUSAL JV
Steelguru - Saturday, 10 Oct 2009
Reuters reported that Indonesia wants to speed up a planned alumina JV between state miner PT Aneka Tambang Tbk and Russia's United Company RUSAL or it may seek a new partner.
Mr Muhammad Lutfi the head country's investment board said that the board has been in talks with Norsk Hydro ASA about the possibility of it working with Antam on the project if there is not sufficient progress with aluminum firm RUSAL.
Mr Lutfi said that a feasibility study on the project to build an alumina plant in Tayan, West Kalimantan began in late 2007 but there does not appear to have been much progress since. The project had been valued at around USD 1.4 billion but could require investment of as much as USD 4 billion including related infrastructure.
He said that "I have assigned one of my deputies and Antam's directors to check RUSAL's commitment by the end of the month and we should be able to have a definitive decision whether to continue or not by the end of the month. If we decide to continue, the options and timeframe must be clear. If not, Antam must have a clear idea on what to do next."
Mr Lutfi said that the MoU between RUSAL and Antam expires this year but the board wants to confirm progress on the project so that they can make a decision as soon as possible.
Mr Bimo Satryo a spokesman for Antam said that progress on the project had been slow but did not elaborate. Antam which has a stock market value of USD 2.5 billion is involved in the exploration and production of nickel, bauxite, iron sands, gold and silver as well as smelting ferronickel.
(Sourced from Reuters)

Rusal started alumina delivery in big bags to cut costs
Steelguru - Saturday, 10 Oct 2009
Dow Jones reported that Russian aluminum producer United Company Rusal has started to transport alumina in big bags on multipurpose wagons to its three major Siberian smelters in order to reduce costs.
The company said that until recently alumina was delivered to the smelters only in special hopper type wagons usually a scarce and costly railroad resource, whereas empty multipurpose wagons are always readily available at dispatch stations.
Rusal said that to cut transportation costs, the company started to deliver alumina in big bags 14 tonnes each on the multipurpose wagons, to its Khakas, Sayanogorsk and Bratsk aluminum smelters. The bags ease the loading and off loading of alumina on these multipurpose wagons.
It said that "The smelters of the company are soon expected to apply the new transportation technology on a wider scale."
The company said that earlier it's aiming to cut costs by USD 1.1 billion in 2009 and cut USD 620 million in costs in the H1 of the year.
(Sourced from Dow Jones)

BHP Billiton moving alumina pricing away from historical way
Steelguru - Saturday, 10 Oct 2009
Dow Jones reported that BHP Billiton PLC is moving its alumina pricing away from the traditional method of benchmarking it as a percentage of the London Metal Exchange aluminum price.
Mr Jon Dudas president Aluminum BHP Billiton said that "BHP Billiton is present in the integrated chain but we strive to price products in their respective markets for example, price alumina on demand supply fundamentals of that industry rather than linked to LME."
Alumina contracts are usually priced at between 11% and 14% of the LME aluminum price.
BHP Billiton is the world's 4th largest producer of bauxite and 4th biggest aluminum producer based on third party sales. According to its equity share in its operations, BHP Billiton's bauxite mines have the capacity to produce 17.3 million tonne of bauxite while its alumina refinery capacity is 5.2 million tonnes. The miner has an equity capacity of 1.34 million tonnes of aluminum with smelters in South Africa and stakes in plants in Argentina and Mozambique.
(Sourced from Dow Jones)

Hydro joins aluminium research in Japan
Your Metal News (press release) - Friday, Oct 09, 2009
Hydro and several of Norway’s leading research organizations have agreed to collaborate with a Japanese university and technology institute in investigating some of the most demanding challenges related to aluminium alloys.
The scope of the cooperation agreement, which was signed at Norway’s embassy in Tokyo, is NOK 10 million over four years. .
Hydro’s Norwegian partners in the agreement are the Norwegian University of Science & Technology (NTNU), the Research Council of Norway, and SINTEF, which is the largest independent research organization in Scandinavia. Partners in Japan are the Toyama University og the Tokyo Institute of Technology..
Bringing bright heads together
"NTNU, SINTEF and Hydro have over many years developed a close relationship in the area of aluminium research," says Helge Jansen, who leads Hydro’s Research & Development activities..
"We’ve cooperated on many Norwegian projects as well as European Union projects. The agreement in Japan is a natural step in developing our research network in Asia. .
"It is important today to look at the entire value chain as one, and to bring bright minds together to raise competence in important and challenging areas like aluminium recycling." .
Jansen says Hydro’s close cooperation with NTNU and SINTEF enables the company to gain unique access to other academic institutions "with knowledge that complements our own and equipment that is world-class." .
A lot to learn
Japanese industry is not directly involved in the project, but will participate through its close ties with the two university partners..
Project leader and NTNU professor Randi Holmestad says she believes these are the types of projects that benefit industry as well as academia, by increasing the competence related to the development of new and better aluminium alloys and through the experience gathered by looking at challenges and opportunities in slightly different ways..
"I can’t wait to get started," she says. "I can already see we have a lot to learn from each other." .
Senior adviser Tor Einar Johnsen in the Research Council of Norway points out that bilateral programs like these are both fundamental and aimed toward industry. .
"This will strengthen our Norwegian knowledge clusters, which are already very good, and help increase recruitment in the actual areas of research," he says..
Source: Hydro.

Alum Tulcea, reopened by Dutch company Vimetco
Financiarul -10 Oct 2009
The Dutch company Vimetco, the largest producer of aluminum in Central and Eastern Europe, has recently announced the re-opening of the Alum plant based in Tulcea (southeastern Romania), continuing thus with the implementation of its modernization and upgrading programme initiated in February 2007.
According to a release of the company, there are currently 600 employees working at the factory, among whom 470 people have been hired recently.
"Vimetco will continue with its long-term strategy, despite the less favorable economic context worldwide. A key-element of this strategy is represented by the vertical integration of the group"s operations, controlling of the entire production chain, from bauxite to such products carrying high added value. Alum is going to supply the necessary of raw material to Alro, securing thus the supply with alumina and the continuous production of aluminum at the plant," CEO Vimetco Frank Mueller said.
The company, which has its headquarters in Amsterdam, replaced some of the existing tools at the Alum, in order to make production lines more efficient and fitting the European environment protection norms. Alum Tulcea (north-east of Bucharest) has a refining capacity of 600,000 tonnes per year. Alum"s shares are listed on the Bucharest Stock Exchange since 1996, carrying the "BBGA" symbol.
Alro Slatina (southern Romania), a company owning Alum Tulcea, recorded a net profit worth 35.31 million lei (11 million dollars) in the first half of the year, that is almost 7 times smaller compared with the same interval a year before, and a turnover worth 718.7 million lei (226 million dollars), that is a drop by 28 percent on the same interval in 2008, according to the financial report of the producer.
Total sales of primary aluminum stood at 115.397 tonnes in the same interval, while the sales of laminated products made of aluminum, accounted for 6 million dollars. Alro Slatina"s share capital stands at 356.89 million lei, being divided into 713.78 million shares, each carrying a nominal value of 0.50 lei.
The majority shareholder of Alro is the Vimetco group, registered in the Netherlands and controlled by the Russian businessman Vitali Masitski. Dutch group Vimetco holds 84.18 percent of the shares of Alro Slatina.

Chinalco insider denies buying RUSAL IPO
Steelguru - Monday, 12 Oct 2009
China Mining reported that Chinalco has no plan to subscribe for RUSAL's IPO shares.
As the largest aluminum producer in China, Chinalco is the parent company of Aluminum Company of China Limited.
The world's largest producer of aluminum and alumina RUSAL is reportedly to probably sell a 10% stake through IPO on Hong Kong bourse this December which will be worth about USD 3 billion on the present value.
Earlier, some Russian media reported that Chinalco would be one of the most potential subscribers and the 2 sides have started negotiations.
However, 2 officials with Chinalco's overseas development department said that they didn't know about the issue when Caijing Magazine asked for their verification.
Another insider in Chinalco's overseas business said that the company used to consider about subscribing for RUSAL's shares but already gave up. The insider didn't offer any reason.
United Company RUSAL owns 7 bauxite and nepheline ore mines, 12 alumina refineries, 15 aluminum smelters and 3 aluminum foil mills with an annual production capacity of 4.4 million tonnes of aluminum and 11.3 million tonnes of alumina.
(Sourced from China Mining)

Guinea in talks with China over resources investment
(AFP) – Monday, 12 Oct 2009
LONDON — Guinea's ruling regime is in talks with China over investment in its natural resources, the west African country's minister of mines said, according to British newspaper the Financial Times on Monday.
Mohamed Thiam said talks could be concluded by the end of the year between the regime in Conakry and the Hong Kong-based China International Fund (CIF) to bring in billions of dollars of financing for infrastructure, minerals projects and oil prospecting, according to the business daily.
The deals would be among the largest of their kind in Africa, said the FT.
The CIF would pump in seven billion dollars of finance for projects ranging from the creation of an airline to power generation.
The fund would also join forces with Angolan state oil company Sonangol to explore for oil offshore. The Guinean regime, CIF and Sonangol had signed a memorandum of understanding on a prospecting deal, Thiam said.
"We think over the next five years there's going to be in excess of seven billion dollars in investment in the Guinea Development Corporation's various projects," said the former UBS banker.
"Instead of just giving natural resources... in exchange for promises of developing our infrastructure, we decided to take the joint venture approach and co-own not only the infrastructure development companies and projects, but also whatever natural resource conpanies or projects are developed jointly."
Guinea is the world's largest bauxite exporter and also has large gold, uranium, diamonds and iron ore deposits.
Opposition leader Sidya Toure, prime minister from 1996 to 1999, said: "I do not understand how you can believe that we can inject this kind of money into the economy of Guinea where the total gross domestic product is only three billion dollars."
The Chinese commerce ministry declined comment when contacted by AFP, with a press officer saying that China International Fund was a Hong Kong company that the ministry "knows nothing about".
The officer, who refused to give his name, also declined comment on possible criticism of China for dealing with Guinea's government.
The foreign ministry did not immediately respond to a request for comment.
CIF and Sonangol did not respond to requests for comment, the FT said.
The newspaper said the deal could potentially pitch China against Western interests at a time of growing competition for Africa's natural resources, and also raise questions about "the willingness of Chinese groups to prop up rogue African governments".
A military junta took power in Guinea in December and earned international condemnation last month for a bloody crackdown on opposition supporters.
United Nations officials and human rights groups say more than 150 people were killed on September 28 when Guinean troops opened fire on an unarmed crowd gathered in a stadium in Conakry to protest against military leader Captain Moussa Dadis Camara's rule.

China tightens grip on Africa with $4.4bn lifeline for Guinea junta
Times Online - October 13, 2009
Chinese businesses in Angola have built roads and rehabilitated railways but their investments in rogue regimes across the continent is attracting criticism
Jonathan Clayton, Africa Correspondent
While the rest of the world recoiled in horror at recent events in Guinea, where at least 150 pro-democracy supporters were killed and dozens of women publicly raped by government soldiers, China has sensed an opportunity to steal another march on Western competitors in Africa.
China is preparing to throw the junta in Guinea a lifeline in the form of a multibillion-pound oil and mineral deal, financed largely by soft loans. Such policies have already served China well with rogue and discredited regimes from Angola to Sudan. The move comes as the European Union, spurred on by France, the former colonial power, and the African Union are considering sanctions against Guinea if its young military leader, Captain Moussa Dadis Camara, continues to renege on a deal to stand down in favour of free elections.
The massacre occurred after 50,000 demonstrators took to the streets when Captain Camara — who seized power in December after the death of the long-time dictator Lansana Conte — announced that he would stand in the poll. Thousands stayed at home yesterday and riot police patrolled empty streets as the opposition called two days of mourning for the dead.
Beijing, meanwhile, was reported to be close to agreeing a deal, financed by its China International Fund, of about £4.4 billion covering a range of projects. Guinea, the world’s largest exporter of bauxite, also has huge deposits of uranium, iron ore, diamonds and a host of other minerals. It is also believed to have significant off-shore oil reserves.
China’s policy of not linking trade, aid and investment to political reform or human rights issues has paid huge dividends so far. In less than a decade it has created a footprint across the entire continent and secured a willing provider of much needed raw materials to power its economic growth.
There is now barely a country on the continent that does not have a sizeable Chinese presence. Copper-rich Zambia and the Congolese province of Katanga now boast the fastest-growing Chinatowns in the world. Sudan, for years out of bounds to Western companies because of its links to terrorism, now pumps 600,000 barrels of oil a day from its Red Sea port into Chinese ships. In return it received weapons that it used against rebellious black Africans in Darfur.
In Angola the Chinese have built roads, de-mined rural areas, upgraded ports and rehabilitated railways. In the Ethiopian and Kenyan capitals of Addis Ababa and Nairobi they are heavily involved in new construction projects.
At the weekend President Kagame of Rwanda, whose Government has frequently been accused of supporting atrocities in neighbouring Congo, praised Chinese investment for helping Africa to develop. "The Chinese bring what Africa needs: investment and money for governments and companies," he told the German Handelsblatt newspaper in an interview. "I would prefer the Western world to invest in Africa rather than hand out development aid."
Annual trade between China and Africa is now put at £62 billion, more than four times the £15 billion that it reached in 2004. China has also written off billions of dollars of bad African debt and used its "war chest" of foreign currency reserves to cement new alliances and finance cut-rate loans and commercial lines of credit.
There is only one condition: any money provided must be used to pay Chinese companies and buy Chinese goods that flood the continent’s bustling street markets. Stalls now overflow with cheap plastic sandals, underwear, artificial flowers and cut-price motorbikes and tools.
Ordinary Africans are far less enthusiastic than the governing elites. Rights activists accuse the Chinese of cutting corners, exploiting corrupt local officials and ignoring health, safety and environmental concerns.
A recent report by the Oxford-based group Rights and Accountability in Development highlighted that 90 per cent of the output of Congo’s mineral-rich Katanga province now went to China. However, it said, Congolese workers accused them of flouting local laws, poor pay, atrocious safety records and no welfare or social development policies.
For years Guinea has been one of the most sinister regimes in West Africa. In recent years it has become a conduit for drug smuggling from Latin America to Western Europe, much of it believed to be organised by the young army officers now so reluctant to give up power.

Chinese company Bosai to pay $30m for Ghana bauxite mine
Joy Online - Monday, 12 October 2009
A privately-owned Chinese mining company, Bosai Minerals Group Co. Ltd., is to pay $30 million for the Awaso mine in Ghana.
World aluminae giant, Rio Tinto, owners of the mine were reported last week to have agreed to sell 80% stake in the mine to Bosai.
The Awaso mine has been producing bauxite since 1941. Rio Tinto had plans to develop an integrated alumina refinery which would have been fed by the Awaso mine, but as a result of poor local infrastructure and lower global demand for minerals it shelved the idea, according to some international media reports.
The deal, which is awaiting approval from Ghana’s parliament, is expected to be sealed by the end of the year.
Bosai Minerals is the world’s largest calcined bauxite and brown fused with alumina producer with an annual production capacity of 300,000 tons of calcined bauxite and 200,000 tons of brown fused alumina.
It also has an annual production capacity of 500,000 tons of alumina, 200,000 tons of aluminum, 300,000 tons of coke, and 300,000 tons of coal.

Guineans in post-massacre protest - Monday, 12 October 2009
Camara seized power in a coup and there is speculation that he will stand in next year's poll [EPA]
Thousands of Guineans have stayed at home in protest over the massacre nearly two weeks ago of at least 150 people who were among thousands demonstrating against the country's military rulers.
The strike, which began on Monday, brought Conakry, the capital, to a standstill with banks, shops, markets and offices remaining closed.
A collection of unions called for the two-day strike after a September 28 demonstration ended in a bloodbath, with security forces opening fire on protesters who had gathered outside a stadium in defiance of an official ban on the protest.
The demonstration followed speculation that Captain Moussa Dadis Camara, Guinea's president who seized power in a coup last December, would stand in next year's elections.
Strong backing
Rights organisations and the UN say the toll may have been higher than 150 and that at least 1,200 people were injured.
The military government puts the death toll at 56.
In a statement issued last week, the main union federation called on people to observe a "day of prayer", urging them to "kneel piously before the mortal remains of the ... martyrs for democracy in Guinea" - a reference to the protesters killed by security forces.
The strike action received strong support in the southeastern town of Kissidougou, where traders said there was "no activity" in the main market.
"All the shops, as well as the banks, have shut down, and the bus station as well," Sall Mamadou Lamarana, a trader, told the AFP news agency.
In northwestern Boke, Sine Magassouba, a teacher, said: "There is no activity at the market. People have been praying in the courtyards, and youth clubs."
Bauxite exports hit
Union sources said the strike also hit an aluminium refinery and bauxite exports, which are a major source of Guinea's foreign exchange.
Sekou Ousmane Diallo, head of the union at UC RUSAL's Friguia refinery, said: "We are maintaining minimum service because an aluminium refinery cannot be completely shut-down without the equipment possibly being damaged. However, 90 per cent of the Friguia workers stayed at home."
The refinery, which was projected to produce 527,000 tonnes of aluminium in 2008, is still operating despite a decision last month by the government to strip it from Rusal. Rusal is contesting the decision.
Efforts to resolve the crisis are continuing and last week Mohamed Ibn Chambas, head of the regional grouping Ecowas, met Blaise Compaore, the president of Burkina Fasso, who has been appointed by the body to mediate.
Amid mounting international pressure on Camara, rights groups have also reported cases of rape and other abuses at the stadium where the protest was staged.

Deripaska urges Russia hydropower overhaul -paper
Reuters - Wed Oct 14, 2009 10:51am IST
Russian industrial magnate Oleg Deripaska has proposed splitting state-run RusHydro (HYDR.MM: Quote, Profile, Research) into four companies and taking a stake in a large Siberian dam serving his aluminium plants, a newspaper reported. Deripaska wrote last week to Prime Minister Vladimir Putin with a proposal that his indebted aluminium company take a stake in the Sayano-Shushenskaya hydroelectric dam, site of a fatal accident in August, Kommersant business daily said on Wednesday.
But the dam, which has not operated since the accident, requires 40 billion roubles ($1.4 billion) in repairs and UC RUSAL, the aluminium firm majority owned by Deripaska, has yet to restructure its $16.8 billion debt to foreign and Russian banks, the newspaper said on its front page.
Kommersant cited an unnamed government source as saying Deripaska had asked Putin to consider splitting RusHydro, which has a monopoly on hydroelectric power generation in Russia, into four separate companies.
A spokesman for Deripaska's industrial holding company, Basic Element, declined to comment on the report when contacted by Reuters.
According to the proposal, the Sayano-Shushenskaya dam itself would be one of the four independent companies within the new structure, Kommersant quoted the source as saying.
UC RUSAL is the world's largest aluminium producer. Several of the company's Siberian smelters were forced to switch to alternative power suppliers after the accident at Sayano-Shushenskaya.
At least 75 people were killed when a turbine room at the dam flooded on Aug. 17. [ID:nLH339111].
In September, the Russian government backed the sale of a 10 percent stake in RusHydro to help fund costly repairs. [ID:nLF329331]
(Writing by Robin Paxton; editing by John Stonestreet)

Guinea bauxite mines paralysed on day 2 of strike
Reuters - Tue Oct 13, 2009
CONAKRY, Oct 13 (Reuters) - Mining operations in Guinea remained at a near-standstill on Tuesday in the second and final day of a general strike aimed at protesting against the recent killing of demonstrators by government security forces.
The freeze in the No. 1 world bauxite exporter, which turned the normally-bustling capital of Conakry into a virtual ghost town, came as the international community reiterated its condemnation of the Sept. 28 bloodshed in which more than 150 people were killed protesting against Guinea's military rulers.
The International Contact Group on Guinea, which met in the Nigerian federal capital Abuja on Monday, also called for a ban on all weapons outside of military barracks in Guinea in the hope of preventing further violence there.
Rising turmoil in the West African nation poses a potential threat to investment and regional stability, particularly in neighboring Sierra Leone, Liberia and Ivory Coast, which are still healing from recent civil wars, analysts have said.
The Guinea Bauxite Company (CBG), a massive joint venture between Anglo-Australian Rio Tinto (RIO.L) (RIO.AX) and U.S. Alcoa (AA.N), said on Tuesday that its operations had been cut back to a minimum as a result of the strike.
"They managed to stop CBG activities. We can do no more than assure a minimum service level of the train and the port," a company official told Reuters.
CBG is the world's largest single bauxite exporter, supplying some 13.7 million tonnes of Guinea's nearly 22 million tonnes of exports in 2008.
A senior executive at Russia's UC RUSAL, which controls the remainder of Guinea's output, said its operations also remained cut to the bone.
"There is still the blockade at Friguia. People are not coming to work," the executive said. "Only the workers needed to provide minimum service to prevent a complete shutdown of the plant are present," he said.
Guinean trade unions called the strike for Monday and Tuesday to mark the killing of protesters in a stadium last month when security forces cracked down on a demonstration that had been organised by opposition to military government.
The incident has drawn broad international condemnation of junta leader Captain Moussa Dadis Camara, who has angered his opponents by refusing to opt out of elections set for January.
Camara took power after a coup last December, initially promising to transfer to civilian rule in a poll by the end of this year.
The African Union has given Camara a mid-October deadline to declare he will remove himself from the election running or face sanctions.
(Reporting by Saliou Samb; writing by Richard Valdmanis; Editing by Keiron Henderson)

Guinea signs $7B mining deal with Chinese firm
The Associated Press - Tue Oct 13, 2009
CONAKRY, Guinea — Guinea's military government said Tuesday it has signed a $7 billion mining agreement with a Chinese company.
Mines Minister Mahmoud Thiam did not name the company involved but said the Chinese firm "will be a strategic partner in all mining projects" in the West African country.
Guinea is the world's largest producer of bauxite, the raw material used to make aluminum, and also produces diamonds and gold.
Yet its mineral wealth was long siphoned off to enrich the country's longtime ruling elite. Guinea had been ruled by only two people since gaining independence from France half century ago until Capt. Moussa "Dadis" Camara seized power in a coup in December.
Camara initially said he would not run in elections scheduled for January, but recently indicated that he may have changed his mind.
A human rights group says 157 people were killed and more than 1,000 wounded late last month when soldiers opened fire at 50,000 pro-democracy demonstrators at the national soccer stadium. The government put the death toll at 57.
Thiam said the Chinese mining projects will help Guinea's poor and dismissed criticisms that such a deal should have waited until after next year's elections.
"We are in a transition putting down foundations and hope the next government will follow suit," Thiam said.
Africa's trade with China reached more than $100 billion in 2008 and has multiplied by 10 since 2001, according to the African Economic Outlook.
The arrival of the Chinese puts them in direct competition with the American-owned Guinea Bauxite Company CBG and the Russians' RUSAL. The Russians have been in a legal tussle with the junta over whether the mines are owned by Guinea's government.
Meanwhile, thousands of Guineans stayed home Tuesday for a second day as a part of a national mourning for those killed at the stadium. Guinea's government has issued a statement saying it supported the trade unions' call for people to stay home for two days.
Copyright © 2009 The Associated Press. All rights reserved.

Aluminum demand continues to drop - 10/14/2009
Tom Stundza
Aluminum Association says bookings are down 29% through September
Demand for aluminum remains anemic, according to the most recent data from the Aluminum Association.
Total aluminum bookings by buyers in September dropped 5.2% from August so they are 28.9% down year-to-date and off 19.8% from September 2008. Aluminum sheet and plate orders were down 15.5% year-over-year in September, while buys of extruded products (shapes, pipe and tube, and rod and bar) were down 23.5%.
Producer shipments of aluminum mill products totaled an estimated 10.83 billion lbs through August, 24.2% below the 2008 year-to-date total of 14.29 billion. Shipments of 1.57 billion lbs of extruded aluminum products through August are down 31.6% from the 2008 year-to-date total of 2.297 billion. Year-to-date shipments of aluminum sheet and plate of 4.689 billion lbs is down 18% from the year-to-date 2008 total of 5.72 billion.
Eight-month shipments of aluminum foil of 649.9 million lb are down 20.5% from the 2008 year-to-date total of 817.3 million.
Reuters reports that aluminum capacity restarts in Asia will prevent aluminum prices from increasing in the coming months. Analysts tell Reuters that while aluminum inventories have stopped accumulating for now, they have leveled off at very high levels with no signs of being drawn down to any great extent.
David Thurtell of Citigroup, for example, tells Reuters "there's still too much capacity being reopened, particularly in China for prices to rally much from here."

Anglesey Aluminium submits plans for £600m power plant
Holyhead and Anglesey Mail - Oct 14 2009
ANGLESEY Aluminium has now formally submitted plans to the UK government to build a £600m power plant which could create 700 jobs.
Last week, the company revealed they had put in plans for 300 Mega Watt wood burning furnaces at their Penrhos site to the government’s Department of Energy.
If passed, 100 permanent jobs would be created. The construction phase could create 600 short term jobs.
The company held a public consultation at Holyhead Town Hall where they launched the details of an environment impact assessment that has been authored by PB Power.
The assessment says that the renewable energy plant will operate in full compliance with the requirements of an Environmental Permit from the Environment Agency.
The report states: "Using a cleaner fuel and process than a comparable thermal plant running on coal or recycled wood means the potential for emissions are greatly reduced."
John Mervyn Jones of Anglesey Aluminium said: "The application was submitted to the Department of Energy on September 1 and we have now started the consultation process with all parties, such as Anglesey County Council, the Environment Agency and Countryside Council for Wales and expect to have their comments back early next year.
"We've had quite a few coming in to see the details of the environmental impact assessment, this is the only real difference to our first public consultation in June where we unveiled the plans to build the biomass plant.
"Around 2.2m tonnes of timber from Canada down to Savannah in the USA would be shipped to Anglesey Aluminium’s deep dock in Holyhead.
"This would mean around 60 ships a year. This is an increase as we usually have one ship berthing a month at the moment.
"We know about the work that is going on to use our jetty as a berth for cruise ships and we feel that we can live together. There is enough room for two ships to berth at the same time at the jetty."
On Wednesday, September 30, nearly 400 workers at the smelter were made redundant as the cheap electricity deal to power the smelting lines ran out.
This leaves around 80 workers at the site to work on re-melting operations.
Anglesey Aluminium energy manager Richard Roberts said: "It’s been very eerie and surreal there for those of us who are left. It’s very sad.
"Those who are still working on the smelting lines have not been around much either as they are receiving training for the re-melting operation."

Electricity woes sink Coega smelter
Business Day - 2009/10/16
ALUMINIUM producer Rio Tinto Alcan has scrapped plans to build a multibillion-rand aluminium smelter at Coega near Port Elizabeth due to concerns about security of electricity supply and Eskom’s proposed hefty tariff increases.
This is a blow to the government’s aspirations to locate heavy industry in Coega, which had been on the cards since 2001, and has often been cited as a catalyst for foreign direct investment.
The cancellation also raises doubt on whether the power-intensive project — proclaimed two years ago by the government as its largest single greenfield investment — will get off the ground.
The fate of the 720000 ton smelter project, which would have provided a much-needed anchor tenant for Coega , hangs in the balance while SA faces serious electricity supply constraints.
A weak balance sheet and the demands of its multibillion-rand capital expansion programme have put Eskom under pressure to get out of electricity supply contracts struck when there was still overcapacity.
In a statement last night, the Department of Trade and Industry, Eskom, the Industrial Development Corporation (IDC) and Rio Tinto said the supply of electricity to the Coega smelter project was insufficient to proceed.
This had led to termination of the electricity supply agreement in accordance with its terms and conditions, the parties said.
Alcan, which later became Rio Tinto Alcan, entered into an electricity supply agreement with Eskom in November 2006.
But after talks "over the past several months", Eskom, Rio, IDC and the Trade and Industry Department had agreed to terminate the electricity supply agreement "as the current context regarding the supply of electricity has changed significantly".
"The parties also concur that it is of utmost importance that a project like the Coega aluminium smelter come on stream when power is reliably available ."
Guy Larin, vice-president, business development for Africa at Rio Tinto Alcan, said that his group was "willing to pursue discussions" on a smelter in the Port Elizabeth area.
The group had spent about 130m on the project since November 2006, he said.
Last year, Rio said it would put the project on hold until about 2012, by when it was hoped SA would have sorted out its electricity problems
Trade and Industry Minister Rob Davies , speaking at a function of the South African Chamber of Commerce and Industry, said last night that "unfortunately the reality of SA’s energy situation" had led to yesterday’s announcement.
"What this indicates is not that we won’t be able to sustain projects over the years, but during the short run for ultra-energy intensive projects we will be constrained."
The government’s infrastructure spending programme would spur development in the motor , chemicals, forestry and agri industries . Davies said the focus would be on energy-saving technology and green technology such as solar panels and water heating. With Mariam Isa, Bloomberg and Bheki Mpofu

Australian carbon scheme to cost jobs, says Rio Tinto
MarketWatch - Oct. 15, 2009
By Alex Wilson
MELBOURNE (MarketWatch) -- Rio Tinto Ltd. said Friday Australia's proposed carbon pollution reduction scheme, or CPRS, needs to be amended or it will hurt the nation's mining industry and cost jobs.
In its strongest statements to date on the scheme, the miner proposed four amendments it said should be made before the legislation is passed through parliament.
"Without these changes, the CPRS legislation will affect the international competitiveness of Australian resources companies and will have long-term consequences for Australian jobs and the Australian resources sector's ability to compete in global markets," Rio said in a statement.
Australia's center-left Labor government plans to introduce a cap-and-trade scheme - similar to one operating in Europe since 2005 - that would cap carbon dioxide emissions from July 2011, forcing heavy polluters to account for their greenhouse-gas emissions. But its first attempt at legislating the scheme was rejected by a hostile Senate in August.
Rio's comments appear to be directed as much at the main opposition conservative Liberal-National coalition as at the government, with coalition lawmakers due to meet Sunday to decide on amendments to the carbon scheme they hope to extract from the government.
The government is due to reintroduce its climate change legislation into parliament in November, and has indicated a degree of willingness to negotiate with opposition lawmakers to push the scheme through.
Labor has a majority in Australia's lower House of Representatives, but needs the Senate support of either the conservative coalition, or all seven minor party senators, to pass any new laws.
Coalition leader Malcolm Turnbull has previously flagged that conservative lawmakers may seek further compensation for electricity generators, as well as concessions for the coal industry and agriculture - key export sectors that may otherwise struggle to compete against nations that don't have a carbon scheme in place.
Rio said the current scheme disproportionately impacts the coal, aluminum and alumina industries and threatens the viability of low-emissions technology.
It called for amendments to the scheme to ensure fair treatment of the coal industry and to support low-emissions technology.
The miner also called for changes to the point at which a carbon liability is imposed to ensure the carbon price signal works effectively.
The annual permit reduction for trade exposed industries should also be removed until international competitors face similar carbon constraints, Rio said

Rio Tinto Reveals Senior Management Appointments, Organisational Structure Changes - Update
RTT News - 10/15/2009
(RTTNews) - Thursday, international mining group Rio Tinto (RTP: News , RIO.L, RTPPF.PK) reported a number of senior management appointments and changes to its organisational structure, effective November 1.
The UK-headquartered group, which combines Rio Tinto Plc, an LSE and NYSE listed company and Rio Tinto Limited, which is listed on the Australian Securities Exchange, reported the re-instatement of the Diamonds and Minerals product group alongside the Iron Ore, Copper, Aluminium and Energy product groups.
The company also said it was expanding the executive committee with three new appointments. Doug Ritchie is being appointed as chief executive of Rio Tinto Energy, based in Brisbane; Andrew Harding will become the chief executive of Rio Tinto Copper, based in London; and Harry Kenyon-Slaney, will become chief executive of Rio Tinto Diamonds and Minerals, also to be based in London.
Bret Clayton will take on the new role of group executive, Business Support and Operations, from the Copper and Diamonds product group, where he was chief executive. His responsibilities include a number of business support, evaluation and assurance functions, together with management of the downstream aluminium assets which are scheduled for divestment. He will continue to be based in London.
Tom Albanese, the company's chief executive said, "These changes are designed to strengthen my team and develop the next generation of Rio Tinto leaders. We are in a long term business and management development is an important priority. Two of our five product group heads will now be based in Australia, reflecting the importance of our base there, with two in London and one in Montreal."
Rio Tinto said that Preston Chiaro, who served as chief executive of the Energy and Minerals product group, will become group executive, Technology and Innovation, based in Salt Lake City. Chiaro will replace Grant Thorne, who has been with the group for 34 years and who will be a special adviser to Rio Tinto after retirement.
Guy Elliott remains chief financial officer, based in London. Sam Walsh remains chief executive of Rio Tinto Iron Ore, based in Perth, and his remit will also now include responsibility for the Australian corporate office. Jacynthe Côté remains chief executive of Rio Tinto Alcan, based in Montreal. Hugo Bague remains group executive, People and Organisation, and Debra Valentine remains group executive, Legal and External Affairs, both based in London

Rio Tinto, BHP Kill Ore Marketing Plan - Scott Eden - 10/15/09
NEW YORK (TheStreet) -- Australian mining giants Rio Tinto(RTP Quote) and BHP Billiton(BHP Quote), under pressure from their steel-mill customers around the world, have changed up the joint venture they formed in June to extract and sell iron ore from their mines in Western Australia.
Under the original plan, 15% of the ore produced by those mines would have been marketed and sold by the joint venture, independent of both Rio and BHP. But steelmakers, already uncomfortable with the status quo of having to buy their most important ingredient from only three companies (the third being
Brazil's Vale(VALE Quote)), have criticized the notion of two of those giants pooling their ore assets. In Europe, steel companies have pushed the European Union to investigate the venture for antitrust violations. Chinese officials have publicly wondered whether the venture would eventually fall apart over the same kinds of monopoly concerns.
In what appears to be a concession to these critics on the part of Rio and BHP, the companies have scuttled the joint venture's co-marketing plan, agreeing to handle the selling of the ore separately.
In a press release, Rio and BHP said they believe the change "will clarify the nature of the JV for customers and emphasize its focus on realizing significant production and development synergies."
On the surface, the two companies struck up the joint venture in order to save billions amid the global recession. But the plan also allowed Rio a way out of an earlier deal with the huge Chinese state-run aluminum concern, Chinalco, which would have bought a stake in Rio -- an equity infusion that the debt-ridden miner at one time desperately needed. But as market conditions, and commodities prices, have recovered, Rio's financial standing improved enough that it no longer needed Chinalco's money.

Dubai wants axed Anglesey Aluminium workers
Daily Post - Oct 15 2009
AXED aluminium workers on Anglesey are being targeted by a company developing the world’s biggest smelter complex nearly 4,000 miles away in the Middle East.
More than 300 workers lost their jobs at Anglesey Aluminium in Holyhead last month when smelting operations were halted over the failure to secure a new power deal.
Now the Emirates Aluminium Company, which is building a $5.7bn the giant smelter at Khalifa Port between Dubai and Abu Dhabi, has launched a recruitment campaign to target the redundant workers.
They want the workers to help staff the smelter complex where production is set to start in 2010.
Unite the Union said the offers would do nothing for the long-term future of the region.
One redundant worker said moving abroad was an option that former workers could be forced to take because of a lack of local opportunities.
Dad-of-two Alwyn Roberts, 47, of Llanfairpwll, said: "I have searched locally but there is nothing but part-time work. Moving abroad is a last resort but is something I have to consider, particularly if I want to earn comparable wages.
"I have spoken to the family and they are not keen, but if there is nothing at all here then I have look at other possibilities. I have teenage girls so being away months at a time is not ideal but I have to find work."
Graham Rogers, regional organiser from Unite, said: "This is no long term solution and what we need are jobs and opportunities in North Wales, not thousands of miles away.
"Workers taking these jobs could put a huge strain on relationships and families, it is certainly not ideal although I know there are very few opportunities back here at the moment. Those who have found work locally have taken large pay cuts."
Founded in February 2007, Emirates Aluminium (Emal), an $8bn joint venture of Dubai Aluminium and Abu Dhabi government-owned investment vehicle Mubadala Development Company, aims to create the world’s largest single-site smelter complex.
MP Albert Owen said: "The fact that the workers are wanted across the world proves the skills and experience base we have here on Anglesey. We need to redouble the efforts to keep those skills on Anglesey. If people do go abroad we need to ensure that opportunities are creating in the future so they can come back."

Guinea mining businesses reopen after strike
Steelguru - Saturday, 17 Oct 2009
Reuters reported that mining operations and daily life mostly returned to normal in Guinea after a 2 day strike called by unions in reaction to a bloody crackdown on anti government protesters on September 28th 2009 brought the No 1 bauxite exporter to a halt.
Officials from the Guinea Bauxite Company JV between Anglo Australian Rio Tinto and US Alcoa that ships bauxite and Russia's UC RUSAL which runs an aluminum refinery and some mining operations said that business had resumed.
According to human rights groups, last month's violence which left 157 civilians dead was the worst since Guinea's military rulers came to power last December and led to intense international calls for the junta to relinquish power.
CBG official said that "The strike was largely followed for 2 days but people are mostly back at work this morning. The production train and the flow of bauxite has resumed as normal."
Operations at UC RUSAL's Friguia refinery which produces 650,000 tonnes of aluminum per year also resumed after the strike and despite a simmering dispute between RUSAL and the junta over ownership of the plant.
A RUSAL official said that "Everything is working as usual the trains are back running their normal routes." He added that the company's bauxite mining operations were also running normally.
(Sourced from Reuters)

Smelters costing us $4.5 billion
Sydney Morning Herald - October 17, 2009
A LIBERAL Party elder and senior member of the state cabinet that decided to build a huge aluminium smelter in south-western Victoria has declared the decision ''absolute madness'', saying it had been a costly ''disaster'' for the state.
Former Hamer and Kennett government minister Rob Maclellan called on his own party and Labor to end taxpayer-funded electricity subsidies for smelters at Portland and Point Henry near Geelong, which an Age investigation shows are likely to cost Victorians more than $4.5 billion by the time the contracts expire in 2014 and 2016. Coupled with special levies and taxes on electricity consumers, imposed by the Kennett and Bracks governments to cover the subsidies, the public bill for the contracts by 2016 would be closer to $6 billion.
Mr Maclellan told The Age it was time the parties worked together to end the subsidies to US giant Alcoa as soon as possible.
''I don't know why we don't just say 'These are sins of government past, of various political persuasions','' he said. ''Let's have it all out in the open and not repeat the mistake and not lengthen the mistake.''
Mr Maclellan said the choice of Portland at a 1979 cabinet meeting was ''typical of a cabinet decision one lives to regret''. ''We were having a collective moment of insanity, because if you are going to have a major electrical consumer, you place it near the electrical generators.''
Portland is 500 kilometres from the major power generators in the Latrobe Valley, and the State Government paid for a transmission line to power the smelter.
Mr Maclellan said Victoria was never an appropriate location for a smelter because of its reliance on electricity generated by burning brown coal. ''If you waved a magic wand you'd put it in Tasmania and power it with hydro-electric, as it now turns out makes sense in every other part of the world.''
After the Hamer government chose Portland, the Cain government signed long-term contracts for cheap electricity, pegged to the world price of aluminium. Weaker-than-expected aluminium prices have left successive governments out of pocket on the deal. The Age analysis indicates the losses to date have been much worse for government than earlier thought.
Portland has been a political football since 1979, particularly in recent years because of concerns about carbon emissions from burning coal.
In the 1990s, the Kennett government sought to renegotiate the contracts, describing them as grossly unfair to wider Victoria, but Alcoa refused.
When the State Electricity Commission was privatised in 1998, the Government signed a long-term agreement with the Loy Yang power station to supply the smelters at the subsidised price up to the end of 2014 and 2016.
In return, the Government sold its 49 per cent share of Loy Yang to Edison Mission at a heavily discounted price and transferred its liability for the smelter subsidy to the SECV, which since privatisation been reduced to a small shell body that exists primarily to administer the smelter contracts.
Since the late 1990s, details of the taxpayer-funded subsidies have been hard to track.
With the help of Melbourne accountant Graeme McMillan, The Age has unravelled the ongoing subsidy mystery, primarily through analysing the obscure financial reports of the SECV, as well as reports by the Auditor-General. Mr McMillan, a public finance specialist, said the most glaring problem with the Alcoa deal was lack of public transparency. ''The little detail that is published is hidden away in the SECV shell where it's been almost impossible to dig it out.''
He called on the Government to publish a detailed, plain-English explanation of the status of subsidies, especially if it is considering further negotiations over electricity contracts with Alcoa.
The original smelter contracts remain strictly confidential, with the SECV refusing The Age access under freedom of information.
Alcoa has long denied that its contracts amount to a subsidy, insisting that it has a ''commercial contract'' with the Government. It also refused to discuss recent meetings with the Government about the future of Portland and Point Henry.
State Treasurer John Lenders has refused repeated requests over many weeks for an interview about the smelters. In a short statement a spokesman said the Government and Alcoa were in ''commercially sensitive'' negotiations.

Cameroon Alumina says finds 550 mln tonnes bauxite
Reuters - October 16, 2009
Cameroon Alumina Ltd has found 550 million tonnes of bauxite deposits at the Ngaoundal and Minim-Martap properties in the Adamawa region, a company official told Reuters.
Cameroon Alumina Ltd is a joint venture set up in 2008 by Dubai Aluminium Company Ltd and India's Hindalco Industries (HALC.BO), which each have a 45 percent stake, along with U.S. firm Hydromine Inc. which holds the remaining interest.
"We've found a minimum of 550 million tonnes of bauxite reserves and all indications are that there may be another 200 million tonnes at least," company co-chair Peter Briger told Reuters on Thursday after presenting an update to government officials.
"The bauxite is first class quality. It is not terribly deep in the ground," he said.
Briger said the company hopes to build a mining operations at the site that would produce 4.5 to 9 million tonnes of bauxite per year starting in late 2014 and an alumina refinery with a capacity of 1.4 to 3 million tonnes.
"The geology and mining feasibility report is under finalization and should be ready by 31 October," said Briger. "The real challenge is the logistics problem because the mining site is 561 km from the port. The key, therefore, is to find an efficient and cost-effective way of bringing processed alumina to the port for export."
Briger said the company was in negotiations with government officials over possibly upgrading and extending existing railway links from the mines to the Kribi deep sea port.
General Manager Eric Lavalou said the project will cost some $5 billion to build and said the company is hoping for a mining license from government by the end of the year.
"Over all, the project is progressing well, within all stakeholders expectations," said Lavalou. "If all goes well according to our plan, the bankable feasibility study should be through in 2012 and make way for construction work to begin, which will last 40 months. ...We expect the first shipment of Cameroon alumina in five years." (Reporting by Tansa Musa; Writing by Richard Valdmanis)

Saudi Arabia relaunches giant power, water project
Gulf Times -Reuters/Riyadh , 17-Oct-2009
Saudi Arabia will invite bids in mid-November for a turnkey contract to build a giant power and water desalination units which was intially going to be awarded to Japan’s Sumitomo Corp, the project’s pilot said.
Fuhaid bin Fahd al-Sharif, governor of the state-controlled Saline Water Conversion Corp (SWCC), said the Japanese firm is welcome to make fresh bids for the Engineering, Procurement and Construction contracts for the Ras Azzour plant.
Sumitomo said in May it has put on hold its consortium’s plans for the $6bn power and water desalination plant after the Saudi government said the plant was no longer designated an independent project.
"They are welcome but they will not get a preferential treatment ... We want to reduce the cost of the project although we have increased its production capacities," Sharif said.
SWCC has signed an agreement with mining firm Maaden and power utility Saudi Electricity Co – both state-controlled – to build the plant.
"The tender will be launched by mid-November at the earliest or in December after the haj pilgrimge. It depends on when we will have the specifications ready," Sharif said, adding that a first roadshow would start next week.
SWCC wants to complete the project during the last quarter of 2013, which would be six months ahead of the original schedule.
The agreement replaces initial plans by Maaden and SWCC to build two separate power and desalination plants to supply a planned aluminum complex at Ras Azzour and boost national power production capacity.
Under the new agreement, Ras Azzour power and water plant will produce 2,400MW of electricity, which is more than under the original plan. The project will now be financed entirely by the government, Sharif said.
The increase in the plant’s power production capacity could offset the impact some of the recent decreases in contracting and construction input costs could have on the project’s overall cost.
"We still expect it to be lower than $6bn". SWCC will take 1bn litres of the plant’s water production capacity while Saudi Electricity will take 1,050MW of the electricity the Ras Azzour plant will produce and Maaden will take 1,350MW.

Glencore awaits response from Venezuela to buy aluminum over several years
El Universal - Monday October 19, 2009
Glencore International is seeking an agreement with Venezuelan authorities to buy 360,000 tons of primary aluminum over several years, reported on Monday the state-run company Venalum, a Venezuelan smelter.
"There is a draft agreement, but so far the minister has not signed anything," told Reuters a Venalum spokesman. According to press reports published in the state of Bolívar, Glencore would receive the metal over a 6-year period.
Venalum officials said that this time the Swiss commodity trader would make a USD 100 million down-payment after signing the contract.
Venalum, the larger of the two Venezuelan state-run smelters, produces about 436,000 tons of primary aluminum.

Columbia Falls Aluminum to shut down Oct. 31
ABCMontana - Oct 21, 2009 at 9:37 PM MDT
COLUMBIA FALLS - Columbia Falls Aluminum is set to shut down at the end of October, leaving 88 employees out of work.
The company had been able to buy discount electricity from the Bonneville Power Administration, a quasi-governmental outfit that for decades sold at-cost electricity to big industrial customers. But with an increase in population came an increase in demand for cheap hydropower, pitting industry against other users.
The amount of at-cost power available to industry was diminished and eventually was replaced entirely by a subsidy that helped the aluminum company and others buy down the cost of electricity.
Critics successfully argued that the subsidy was too large and came at the expense of other rate payers, and in December a court ordered the Bonneville Power Administration to end its subsidy to Columbia Falls Aluminum.
Bonneville and the aluminum producer put together a "bridge agreement" that carried the company through Sept. 30, but that agreement also was successfully challenged.

Rusal eyes Anglo?
The Southern Times - Oct 21, 2009
Gilbertson is incoming chairman of "United Company Rusal", which will become the world's largest aluminium producer, once the merger between Sual, of which Gilbertson is president, Russian aluminium competitor Rusal and private Swiss commodities trader Glencore takes place.
The merged entity would be in the mould of diversified mining giant BHP Billiton, which Gilbertson was instrumental in creating in 2001, reports The Times.
Rumours of an Anglo takeover have been rife, but until recently, the main suspects have been Rio Tinto, Xstrata (in which Glencore is a major shareholder) and BHP Billiton.
"Sources in Moscow have told The Times that Gilbertson is stepping up Rusal's expansion plans and is targeting Anglo American for a bid next year," wrote the Times.
The Times said that the enlarged Rusal has borrowing capacity of $15bn and will use this to reverse into Anglo, giving Rusal the listing on the London Stock Exchange.
Gilbertson became CE of Gencor in 1994 and set about unbundling that company. Companies unbundled included Engen, Malbak, Sappi, Gensec and later, Gengold and Impala Platinum.
Gencor acquired Billiton in 1996-7 and in 2001, merged with BHP. Gilbertson quit as CE of BHP Billiton at the end of 2002. He joined Indian resources group Vedanta, but was dropped from the board in 2004 after he was approached by Sual.
Gilbertson is one of the world's highest-paid mining executives. The Rusal deal could earn him as much as '100m, Britain's Sunday Times reported. If he were to head Anglo American, shareholders may welcome the move; the group has under-performed its rivals BHP Billiton and Rio Tinto in recent years.
Anglo differs from BHP Billiton and Rio in that it does not own outright many of its assets, such as AngloGold, Anglo Platinum and Tongaat Hullet, each of which is separately listed on the JSE. By contrast the model at BHP Billiton and Rio Tinto is to own, wherever possible, 100 percent of an asset, to control cash flows from the centre of the group.
Recently, Anglo signalled its intention to sell non-core assets. It has agreed to sell its steel-and-vanadium business Highveld to Russia's Evraz and has plans to list its paper and packaging division Mondi this year. ' Mineweb.

Alutrint profitable in five years
The Trinidad Guardian Oct 22, 2009
On September 16, the local aluminium company Alutrint held a function at the Hyatt regency Hotel in Port-of-Spain to launch a brochure on the aluminium industry in T&T.After the formal part of the function, I spoke with Energy Minister Conrad Enill and Alutrint chief executive Phillip Julien.
Here’s an excerpt of both interviews:
AW: Among the issues that have been raised by those who are opposed to the smelter is the issue of the economic viability of the Alutrint smelter project. Is it viable?
CE: The Government took the decision that we would enter into the industry and therefore in the long term it would be viable on the same basis that the Point Lisas development project is viable.
Any industry that we are getting into for the first time would require us to put into that industry a development-type input. This would be the same. But if you look globally and in the long term, the smelter would be economic.
AW: Based at what price of product?
CE: The planners of the smelter project did a number of different scenarios and the model that is going forward, both in terms of power costs and in terms of how we propose to set up the marketing arrangements, takes that into account. The details of these are available but I don’t keep that in my head.
AW: What’s the price of natural gas that, it is proposed, will be converted into electricity to run the smelter?
CE: I think there are two issues. The first issue is that we put a price that meets the requirement but secondly, there is an escalation clause in the contract such that if the commercial price goes up, then the cost of natural gas to the project goes up as well. Therefore, there is not going to be the expectation of any subsidy on the natural gas.
AW: How soon do you expect the project to be profitable as opposed to viable?
CE: It will depend. Right now, you would recognise that we are going through a series of challenges as it relates to the implementation of the project. Clearly that is going to create some cost pressures that would have to be factored in. But, by and large as most government projects go, this should be profitable in five or six years.
AW: Do you think that the public information drive that Alutrint is going on would have the effect of convincing any of the anti-smelter people?
CE: No, I don’t think the intention is to convince the anti-smelter people. The intention is simply to provide the information that we have used in arriving at the decisions. And clearly the decision that we have arrived at is based on the soundest data that is available. We talked today about those who are opposed talking about the incident in China to create some kind of impression that the Alutrint smelter is unsafe. Whereas the truth is that the Chinese incident was simply not relevant to the issue because it was not an aluminium smelter. The real issue is that there are some people who believe that the natural gas-led industrialisation process is not one that they support. And therefore it does not matter what you do, they are going to have a point of view that is different to yours. Convincing the anti-smelter people is not the intention of today’s function. The intention really is to bring balance to the discussion and to provide the facts as we know them.

The discussion with Phillip Julien was longer and more wider ranging than the discussion with Mr Enill.
AW: How has the search for a new equity partner been going?
PJ: It has been going very well, I have to leave it with the primary shareholder itself to make the formal statement on it. I am reasonably confident that you will be hearing something positive in the near future. Closure on the search should happen before the end of this year, God willing.
AW: Is it likely to be a Chinese company given the fact that they are the builders and the providers of the technology?
PJ: At this point, the People’s Republic of China are focusing their interest in making sure that the smelter construction component is built well as well as supporting it through the debt financing, which is quite substantial. In terms of their participation in the equity, that really is a question for the shareholder.
AW: Would the equity participant be a well known name?
PJ: In the industry, it is a well-known name. And without giving too much away, I would dare say that they would be known not only in the aluminium smelting industry but in the downstream use of aluminium. [Sources in Brazil’s aluminium sector confirmed that the proposed equity partner is the Votorantim group of Brazil, whose aluminium company, CBA, is Brazil’s largest aluminium producer. CBA’s reported share is 10 per cent.
AW: One of the interesting things about Alutrint is that it may start its life without the kind of backward vertical integration that most smelters have—as in the ownership of an alumina source. What is the shareholder doing about that issue?
PJ: Alumina, which is our raw material, is always very competitively priced and it is linked to the LME (London Metal Exchange) price of aluminium. So while a completely vertically integrated producer may have some built-in advantages, it is entirely possible for a smelter, particularly with linkages to downstream, to be more than economically viable by buying alumina from various entities out there.
AW: One of the big issues for me is the issue of whether the smelter is going to be viable. And, even more to the point, whether it is going to be profitable. I would imagine that viability and profitability depend on the price of natural gas and alumina as well as the price that the final products can fetch. What can you say that would assure the reading public that Alutrint is going to be viable and eventually profitable?
PJ: Without going into details, I would like to answer that with some analogies.
We know of numerous smelters in China with similar equipment and technology to us, yet which have a much higher operating cost than us because their electricity is fuelled by coal and ours by natural gas. Yet those Chinese smelters are still able to be profitable at today’s depressed prices. There are smelters in the western world built at a much higher capital cost than Alutrint will be built. Alutrint is being built at a lower capital cost than most of the recent smelters in the western world because of the advantage of working with a Chinese design, technology and the very attractive debt financing.
So we have very attractive financing, an economically priced smelter and the country has natural gas—which is one of the more competitive raw materials for the operating cost of the smelter because power is about 30 to 35 per cent of your operating cost.
So just intuitively, from a layman’s perspective, and taking into account that the aluminium industry is cyclical, it allowed the Government to predict a conservative value when doing the overall economics of the smelter to ensure that we can ride out this cyclical storm and more importantly, play to our strength of a competitive price of power—without giving away the farm—which will place us in the lowest quartile in terms of operating cost.
AW: At today’s price of aluminium, would Alutrint be profitable?
PJ: I’m not at liberty to say what the LME price was based at. But over the course of the last four years that Alutrint has been in existence, I have never had a burning concern about whether the project would be, ultimately, viable and profitable.
AW: I would imagine that at last year’s historic peak prices, had the smelter been in operation, it would have been very profitable?
PJ: Maybe not last year. That’s something that I cogitate on regularly—if the delay in construction may ultimately redound to our benefit. The industry went through a terrible time recently and six months prior to that was the best time ever.
My take is that if we had come into production when we were slated to, we would have had a rough few months because we may have started at the peak of the cycle and would have had to ensure all the learning pains as that cycle started to come down.
That would have brought a great deal of undue stress and pressure on Alutrint, which, knock on wood, we would not have to face again in the future.
AW: So what you are saying is that the viability of the project does not depend on an astronomical price?
PJ: No never. Not at all. The beauty of the Alutrint project is the financing coming from China which allows us to have the robustness which ensures viability at a very management LME price.
AW: What is the financing from China?
PJ: It’s US$400 million in total—US$100 million in a concessionary loan and US$300 million in buyers’ credit which is more commercial. The concessionary loan is much lower than the buyer’s credit.

Largest aluminum plant commissioned
Tehran Times - 23-Oct-2009
BANDAR ABBAS – Hormozal, the biggest aluminum plant in Iran, started operation in southern city of Bandar Abbas.
Iranian Mines and Mining Industries Development and Renovation Organization (IMIDRO) Director Ahmad-Ali Harati-Nik said in Bandar Abbas about 400 million euros and 2 trillion rials or some $200 million, has been invested in the project.
He added that Hormozal has an annual capacity of 147,000 tons and 500 jobs will be created directly and 2,000 jobs indirectly by implementing the project.
The most advanced technology in the aluminum industry, namely the 230 KA, has been applied in the project, he stated.
Hormozal plant has been built adjacent to Almahdi aluminum plant in the city of Bandar Abbas.
Bandar Abbas Province will be the aluminum hub of Iran when this project comes on stream

Expat mining execs flee Guinea on security concern
Reuters - Sun Oct 25, 2009
CONAKRY, Oct 25 (Reuters) - Around half the expatriate workers at the world's biggest bauxite exporter, Compagnie des Bauxites de Guinee (CBG), have fled Guinea due to rising tensions there, a source within the company said on Sunday.
Around 15 of CBG's 30 foreign employees have left the West African country for "security reasons", the source said, speaking on condition of anonymity.
"Despite everything, it won't affect forecast production," he said.
Guinea's military junta has attracted a storm of international condemnation since Sept. 28, when security forces killed more than 150 people in a crackdown on an anti-government protest.
Even before the massacre, the ruling National Council for Democracy and Development (CNDD) and its leader Captain Moussa Dadis Camara had drawn domestic and international criticism by refusing to rule themselves out of running in elections, and for stifling political opposition.
Mineral exports are the chief foreign currency earner for Guinea, but the CNDD has had disputes, some of them ongoing, with several of the foreign firms that work there, including UC RUSAL and Anglogold Ashanti (ANGJ.J).
CBG produced 13.7 million tonnes of aluminium ore bauxite in 2008, its highest annual volume. It is majority owned by Halco, a firm in which metals majors Alcoa (AA.N) and Rio Tinto (RIO.L) are partners.
Company officials were not immediately available for comment. (Reporting by Saliou Samb; Writing by Daniel Magnowski; Editing by Elizabeth Fullerton)
© Thomson Reuters 2009 All rights reserved

Europe's OEA proposes new pricing system for aluminum alloy (subscription) - 26-Oct-2009
The Organization of European Aluminium Refiners and Remelters (OEA) wants to adopt a pricing system for casting alloys, general secretary G?nter Kirchner said on Monday.
Kirchner announced plans for the initiative at the nonferrous metals division of the Bureau of International Recycling (BIR) conference in Amsterdam on Monday, and took many delegates by surprise.
"We need a stable relationship between scrap and aluminum alloys. It's missing," he said referring to the smaller margins for alloy producers who have had in recent years to pay more for their raw material and get less for their alloy.
The initiative was prompted by requests from OEA members, which include Aleris Recycling GmbH in Germany, Austria Metall AG (Amag) Casting in...
You are currently only viewing a sample of a 590 word article. To view the full article you must be a subscriber to Metal Bulletin or sign-up to a free trial to the Metal Bulletin website
Copyright © Metal Bulletin Ltd. All rights reserved.

Rusal hit by 6 billion dollar loss in 2008: report
AFP – 26-Oct-2009
MOSCOW — Russian aluminum giant UC Rusal suffered a six billion dollar loss in 2008 due the global economic crisis, according to a presentation ahead of its planned share listing in Hong Kong and Paris, a report said Monday.
The Vedomosti daily said Rusal announced the 2008 net loss of 5.98 billion dollars in a presentation to analysts from investment banks who plan to take part in its Initial Public Offering (IPO).
The IPO -- which has so far not been officially confirmed by the company -- would be the most significant such listing by a Russian firm since the onset last year of the financial crisis.
According to Vedomosti, the company made a net loss of 720 million dollars in the first half of 2009.
It said that revenues at Rusal had remained robust, reaching 15.68 billion dollars in 2008, and that most of its losses stemmed from write-downs on aseets.
Most importantly, its 25 percent stake in the world's biggest nickel producer Norilsk Nickel, acquired in April 2008 just before the financial crisis broke, is now only worth a fifth of what it was.
The majority shareholder in Rusal is Russia's former richest man Oleg Deripaska who owns almost 57 percent, while the current richest man Mikhail Prokhorov has a 14 percent stake.
Vedomosti said that the IPO would involve 10 percent of the company's capital and the proceeds would be used exclusively to eradicate its debts.
According to media reports, Rusal plans to list simultaneously on the Hong Kong Stock Exchange and the Paris bourse, part of the pan-European stock exchange Euronext, but
not in Russia.
The economic crisis has left Rusal billions of dollars in debt and it has been in complex talks with its creditor banks to restructure the debts.
Copyright © 2009 AFP. All rights reserved

Straumsvík Smelter Enlargement Up for Re-vote
IcelandReview - 27/10/2009
A sufficient number of Hafnarfjördur residents have signed a petition for a vote on the enlargement of the Rio Tinto Alcan aluminum smelter in Straumsvík, which lies within the town limits, to be repeated.
One fourth of residents, who are eligible voters, must sign a petition in order for it to be valid, Fréttabladid reports.
In 2007, Hafnarfjördur residents rejected the smelter enlargement by only 88 votes and so Alcan’s enlargement plans in Straumsvík were canceled.
In a Hafnarfjördur town council meeting on Thursday last week, council members agreed to entrust the town’s urban planning and construction division with reopening discussions with the smelter’s executives on the position of their plans for enlargement.
Mayor of Hafnarfjördur Lúdvík Geirsson said the ball is now in the court of Rio Tinto Alcan, asking: "Are they in the same position as two years ago and do they wish to make a new proposal on potential enlargement or has anything changed in that regard?"
However, the information officer of Rio Tinto Alcan in Iceland, Ólafur Teitur Gudnason, said the rules on voting of this kind are clear. If one fourth of eligible voters sign a petition, a vote should take place. That does not depend on Alcan’s wishes.
Hafnarfjördur authorities never formally replied to Alcan’s application for a construction permit but considered the results of the 2007 vote to be binding. Therefore, the original application is still valid, Gudnason explained.
"If townspeople are keen on green-lighting this project we will definitely look into whether and when it could be carried through," Gudnason said. "However, we won’t look into anything before we know whether we have the town’s approval."
According to Fréttabladid’s sources, a re-vote on the smelter enlargement could take place alongside the elections for the Hafnarfjördur town council next spring.

Bauxite trucking to bring new jobs
Jamaica Gleaner - Carl Gilchrist - Wednesday | October 28, 2009
The movement of 700,000 tonnes of bauxite by Jamalco from its Mile Gully mines in Manchester to its refinery in St Jago, Clarendon, set to start November 2, is to provide jobs in the communities being affected, The Gleaner has been told by the company.
The exercise is to last approximately 18 months, up to May 2011, and while it is unclear what jobs will be made available, Leo Lambert, manager, corporate services and government affairs at Jamalco, said, "We are committed to ensuring that as much economic benefits as possible flow to the communities during the period of bauxite haulage and have already devised a system that will see specific jobs being made available to them on a rotating basis".
The statement means more good news for the bauxite sector, following the announcement of increased production levels at St Ann Jamaica Bauxite earlier this year, which resulted in workers returning to full work schedules.
In the case of Jamalco, though, despite the amount of bauxite being transported, there has been no announcement of an increase in production.
Peak production
"The refinery has been averaging peak production of 4,050 tonnes of digester output for most of this year. The 700,000 tonnes of bauxite represents inventory from exploratory mining that was done in north Manchester in 2007. It is required not to increase, but to sustain the current peak production at the refinery," Lambert explained.
The bauxite will be trucked from Mile Gully to Williamsfield, then on to the old Melrose road, and eventually to Jamalco's loading station in St Jago.
From there it will be transported by rail to the refinery at Halse Hall.
But the trucking is to be done under tough guidelines set out by the relevant agencies.
In a newspaper advertisement, Jamalco says the movement will be done in strict compliance with rules and guidelines set out by the National Environment and Planning Agency, Jamaica Bauxite Institute, police in both parishes and by its own environmental health safety standards.
In detailing the guidelines, Lambert explained that each truck has to be covered with tarpaulin and the wheels were to be washed to remove any bauxite residue before departing.
Also, trucks are required to leave at intervals of 15 minutes to avoid developing convoys on the road.
As the movement of the bauxite will be done during the night from 7 p.m. to 6 a.m., trucks being used must meet specified safety and maintenance standards, including having proper reflective lighting for high visibility.
"Senior supervisory personnel from Jamalco will also police the route to ensure that there is strict compliance with the guidelines," Lambert said.
Already, community sensitisation sessions have started. According to Lambert, there have been two major community meetings, and residents have received individual letters advising of the pending activity.
Brochures and flyers have also been distributed and posted at strategic places in some communities.

Aluminum price rally may drive Century to restart Ravenswood
American Metal Market - Anne Riley - Oct 28 2009
If the aluminum market continues its pricing rally, Century Aluminum Co. could be in a position to restart output at its 170,000-tonne-per-year Ravenswood, W.Va., smelter, which has sat idle since February.
The Monterey, Calif.-based Century would need to see a sustainable aluminum price "somewhere north of the $2,000 to $2,100 (per tonne) range" for a restart at the facility to be viable, according to Logan W. Kruger, the company's president and chief executive officer.
On Wednesday, three-month aluminum closed second-ring trade on the London Metal Exchange at $1,962 per tonne. That was down 2.8 percent from Tuesday's $2,017.50 per tonne, a two-month record, but still a 52.3-percent recovery from the $1,288.50-per-tonne low registered in the first quarter.
In addition to a sustainable price, a restart of the Ravenswood smelter would also require a long-term power agreement, a new contract with labor officials and an injection of cash, Century said. But if those factors align, the plant could rejoin the company's operating facilities...
This is a preview of the article. The full article is available only to our subscribers and trial users

Noranda profitable as output climbs
American Metal Market - Anne Riley - Oct 28 2009
Nine months after a brutal ice storm knocked out three-quarters of its sole smelting operation, Noranda Aluminum Holding Corp. is inching back toward full production at its New Madrid, Mo., primary aluminum facility.
"We're not quite at 65 percent, but we're pretty darn close," chief financial officer Robert Mahoney told AMM, noting that the company expects to report a profit for the third quarter.
Franklin, Tenn.-based Noranda, which lost as much as 75 percent of the three-potline plant's 261,000-tonne capacity in the storm, has been working to get the second and third lines up and running before the start of the new year.
"There are always a couple of pots in repair and maintenance, but we effectively have two lines up now," Mahoney said, and the third line should be in production at the beginning of the first quarter.
"We're slowly recovering from the smelter outage...
This is a preview of the article. The full article is available only to our subscribers and trial users.

Maaden looks to be among lowest-cost aluminum producers
Gulf Times - Oct 28 2009
Zawya Dow Jones /Manama
Saudi Arabian Mining Co, better known as Maaden, expects to be among the lowest-cost aluminum producers after striking a deal with two state-backed utilities to merge a planned power and desalination project, and securing full government funding for it, the company’s chief executive said.
"We completed a significant achievement with Saudi Electricity Co (SEC) and Saline Water Conversion Corp (SWCC), to build the plant," Abdallah al-Dabbagh told Zawya Dow Jones in an interview in Bahrain on Tuesday.
Maaden, which is listed on the Saudi bourse and has government entities as its biggest shareholders, had originally planned to build its own power generation and water desalination station to fire its planned aluminum complex at Raz Al Zour on the Arabian Gulf.
However, it revisited the plans after last year’s withdrawal of Rio Tinto unit Rio Tinto Alcan as equity partner from the project due to the change in the world economic environment.
Maaden will now participate with SEC and SWCC in building a 2,400MW power plant.

China Aluminum Smelters Finally Making Money
MetalMiner - Stuart Burns -October 28th, 2009 ·
Aluminium Corpn. Of China, (Chalco), the industry leader in China, has returned to profit in the third quarter for the first time in a year as the stimulus package and state assistance finally fed through into increased demand according to Bloomberg. The profit was pretty anemic, just $3m down 88% from last year’s $25m for the same quarter but the company sees China’s demand continuing and expects to post a small net profit for the year.
Even so high inventories and over capacity will limit the scope for further price rises and hence profit improvement in 2010. By Chalco’s own admission, the industry as a whole is in a state of overcapacity to the tune of 20-30% even though the firm is running at 86% of aluminum capacity and 90% of alumina capacity. Alcoa is quoted as saying they expect demand in China to rise by 4% next year, pretty muted compared to previous years but at least growth of sorts compared the west.
Prices in China have held up better than on world markets, falling only 20% from last year averaging over $2100 per metric ton in the third quarter compared to the LME at US$ 1836 per metric ton. Chalco is expecting prices to remain above $2100 per ton on the domestic market in the fourth quarter even though smelters and traders are estimated to hold over 600,000 metric tons of surplus output. Demand may reach 12.85m tons in 2010 but that will still be less than production and way below the country’s estimated 16-17m tons of capacity.
–Stuart Burns

DJ Century Aluminum Assessing Helguvik Smelter Financing Options
Trading Markets (press release) - Wed. October 28, 2009
LONDON, Oct 28, 2009 (Dow Jones Commodities News via Comtex) -- CENX | Quote | Chart | News | PowerRating -- Century Aluminum Co. (CENX) said late Tuesday it is assessing its financing options for the first phase of its Helguvik smelter project in Iceland, which saw construction halt as the global economic downturn took its toll on the banking sector.
"We are presently assessing our financing options for the project's first phase," said company President and Chief Executive Logan Kruger.
"In addition, we are working with the key constituencies in Iceland to satisfy the requirements for a full restart; toward that end, in August we signed an Investment Agreement with the government of Iceland," he added.
The principal aim of the agreement is to secure certain stability within the legal and operational environment of the aluminum plant, which is a prerequisite for completing the financing of the project.
On Sept. 11, Century's Icelandic subsidiary Nordural said it had appointed BNP Paribas SA (BNP.FR), Societe Generale SA (SCGLY) and ING Bank NV to serve as exclusive structuring banks for financing the construction of Helguvik. The banks will lead the effort to raise project financing from the international debt markets.
-By Andrea Hotter, Dow Jones Newswires; +44 (0)20 7842 9413;

Ord River Resources signs Laos bauxite mining joint venture agreement
Proactive Investors Australia - Friday, October 30, 2009
Ord River Resources Limited’s (ASX: ORD) SARCO joint venture company with China Nonferrous Metal Industry’s Foreign Engineering and Construction Co (NFC) has signed a Joint Venture Agreement with Sahabolisat Lao Bolikarn Ltd (LSI) to take the Laos bauxite project to the mining stage.
The agreement is a significant milestone achieved in the development of the Laos bauxite project. It marks the beginning of its transition from exploration phase to mining stage, said Ord managing director Peter Shou.
"We are now one big step closer to building a world class alumina refinery in Laos," he said. "This agreement has given us certainty and a framework to proceed to our ultimate goal. Over the last few years SARCO has completed the majority of the necessary survey work under the Survey License and proved up 130 mt of bauxite in Laos. "
LSI is the current surveying license holder for the 66 square kilometre tenement. SARCO has been working closely with LSI and exploring and proving up the reserve in partnership with LSI.
SARCO will have 51% of the JV and be the operator. LSI has 49% of the JV which includes any interest LSI is obliged to assign to the Lao government. (NFC has a 51% ownership in the SARCO JV and Ord 49%.)
Under the Agreement SARCO and LSI have agreed to build an alumina refinery which has a capacity to produce 600,000 tonnes of alumina per annum.
The preliminary estimated project cost, subject to feasibility study, is US$500million.
Under the agreement the refinery’s capacity is to be expanded to 1,800,000 tonnes per annum, subject to further feasibility study if required in the future and a feasibility study to produce an economic‐-??technical analysis will be completed within 18 months. This period can be extended if required.

Alcoa and COMAC Explore Leading Technology Solutions for C919, China’s Largest Passenger Aircraft (Pressemitteilung) - 2009-10-29
Alcoa (NYSE:AA) and Commercial Aircraft Corporation of China Ltd.
(COMAC) today announced they are jointly exploring leading technology solutions for the design and development of China’s new, large passenger jet, the C919. Through a technology cooperation agreement, the two companies are examining advanced aluminum structural concepts, designs and alloys to create the 190-seat aircraft.
"We are working closely with COMAC to develop a tailored solution that will meet COMAC’s goal of creating a globally competitive, high-performance, economical commercial airliner," said Helmut Wieser, Alcoa Executive Vice-President and Group President Global Rolled Products and Asia.
The aircraft will be assembled in Shanghai, but will source parts and components globally.
"The C919 will be the largest passenger jet to be produced in China. Our goal is to design an efficient, high-performance structure that will compete in the global aerospace market. Therefore, it is imperative that we look at design alternatives and collaborate with innovative materials technology leaders like Alcoa," said Wu Guanghui, chief designer of the C919 program and vice president of COMAC.
A prototype of the C919 was displayed at the Asian Aerospace International Expo and Congress in Hong Kong last month. There is strong market interest for this aircraft based on China’s expected long term growth in global passenger traffic demand. The C919 is expected to take its first flight in 2014 and enter service in 2016.
Alcoa has 15 locations throughout China. Offices and plants are located in Beijing, Shanghai, Qinhuangdao, Kunshan, Suzhou, Guangzhou and Hong Kong. Alcoa’s advanced alloys and materials are used on China’s first home-produced regional jet, the ARJ21-700. To learn more about Alcoa’s aerospace activities and capabilities visit :

Urals Boeing Supplier Stuck In Mid-Air
RusBusinessNews - 28.10.2009
The Russian maker of aluminium semi finished products OAO Kamensk-Uralsky Metallurgical Works - KUMZ (MC Aluminium Products) has managed to reach agreements on trial batch shipments to Bombardier and Boeing. However, the RusBusinessNews observer found out that entering the global market might bring multimillion losses to the company instead of profits, as the plant cannot assure the required quality.
The crash of the domestic market forced the company to enter foreign markets. According to Andrey Kurganskiy, the Commercial Director of KUMZ, twenty years ago the five leading soviet plants were making 1.5 million tons of aluminium semi ready products annually. The Kamensk-Uralsky plant was making 200-250 thousand tons. The market has gone down later, even during the construction boom in 2007-2008 the domestic machine building sector was consuming no more than 215 thousand tons of semi finished products, 34 thousand tons out of which was imported.
In the meantime the world's leading aircraft manufacturers need aluminium slabs with the thickness of 24 to 152 millimetres. Some years back Boeing offered OAO Kamensk-Uralsky Metallurgical Works to become one of the company's suppliers.
This new window of opportunities, having opened, demanded the production to be modernized. In 2006 KUMZ purchased state of the art slab casting equipment in USA and in a year's time KUMZ has built the Chkalovsky plant for further processing of the rolled slabs - thermal processing, flattening, tensioning. The slabs, however, are still made on the old mill which does not conform to the requirements. German companies suggested to upgrade it but the preference has been given to a Ukrainian company. Having spent 13 million dollars Kamensk-Uralsky Metallurgical Works did not manage to resolve the problem: the upgraded mill does not give the needed quality. The Chkalovsky plant, in which about a hundred million dollars was invested, is virtually idling.
The company's proprietors decided to build a new rolling complex with the capacity of 166 thousand tons of rolled aluminium per year. The 300 million dollar project has been approved by the Ministry of Industry and Trade of the RF and the Ministry of Economic Development of the RF. China has agreed to allocate the credit resources needed for its implementation: The money, according to Alexei Filippov, the Managing Director of KUMZ, is already in Vnesheconombank that has approved the project at the preliminary meeting of the Credit Committee.
The time to get the credit has not turned out the most fortunate, Alexei Filippov expressed the concern that with 16% annual interest and the profitability of the production at 6-7% the plant might not manage to pay its debts. According to him the credit line must be subsidized by the state and the company should be given tax concessions on customs duties and VAT for the equipment purchased abroad. Representatives of the Ministry of Industry of the Sverdlovsk Oblast expressed doubts whether federal or regional authorities would be prepared to give tax concessions in the situation of deficit budget.
KUMZ's main problem, however, is not in the expensive credit. Experts claim that the plant still cannot make slabs with the needed set of characteristics. According to Viktor Zamyatin, a professor at the Ural State Technical Univesrity - UPI, the technological modes have not been stabilized yet: sometimes it is the constructional properties that do not conform to the requirements, sometimes it is mechanical or corrosion properties. The surface quality leaves a lot to be desired as well as the geometry, markings, and tolerances.
Prior to the crisis the plant had been trying to establish the causes employing specialists from USTU-UPI which has the state of the art scanning and transmission electron microscopes. Certain changes to the chemical composition of the ingot have been introduced but with the onset of the financial crisis the cooperation ceased.
Prof. Zamyatin reckons that it will be extremely difficult for the plant to manage the situation on its own because, first of all, it does not have the necessary equipment, and, secondly, today the requirements to the strength of metal structures are very high, they can only be reached in the process of an integrated scientific research. KUMZ management is aware of this but the company is in a very difficult economic situation and has difficulties even in finding money to pay wages to its staff.
The lack of established technologies will turn into losses of orders from aircraft manufacturers for Kamensk-Uralsky Metallurgical Works. In this case the company will cease to exist: United Aircraft Corporation will not be able to use slabs made at Chkalovsky plant. Continuing to work with foreign companies with the existing level of technology threatens bankruptcy altogether: Boeing and Bombardier have already told KUMZ that failure to fulfil the contract will lead to penalties worth millions of dollars.
Reports from global aluminium semi ready products markets give the company's managers some optimism. The Norwegian Norsk Hydro announced that according to the results of the third quarter 2009 the demand for rolled aluminium has started growing. Metal trader ASMP, the company representing KUMZ abroad, is expecting a 20% growth in sales to the South-East Asia in 2010. Experts recon, that the US market will become more lively quite soon as well.
Friedhelm Schluter, ASMP representative, however, pointed out that competition amongst aluminium semi ready products suppliers to aviation, space, and ship-building sectors is growing. Up to ten companies are willing to supply rolled metal to Europe, and up to a hundred - die stampings. KUMZ's competitors are dropping their prices and cutting down lead times in order to get a share of the market. Also, companies in the European Union do not pay customs duties when trading within the EU. This is just the right time to remember the unfortunate fact that not all airplanes which have taken off land safely.
Vladimir Terletski

China's Yunnan eyes 1-million T aluminium project
Reuters - Polly Yam, Jeremy Laurence - Thu Oct 29, 2009
HONG KONG, Oct 29 (Reuters) - Yunnan Metallurgical Group, the parent of Yunnan Aluminium Industry (000807.SZ), and the government of Zhaotong city have signed an agreement to build a plant with one million tonnes a year of aluminium smelting capacity, industry and city officials said on Thursday.
The plant, if built, could be operated by Yunnan Aluminium given China's requirement that listed companies' parents are not allowed to compete with their listed arms.
Yunnan Aluminium already operates 400,000 tonnes a year of smelting capacity and is building a plant to produce alumina, the main raw material for aluminium production, in Yunnan province.
"They signed the framework agreement the day before yesterday," an official at the economic and trade commission in Zhaotong city in Yunnan province told Reuters. He was referring to the city government and Yunnan Metallurgical.
The city government and Yunnan Metallurgical have not set a timetable to start construction of the first phase, which will be 300,000 tonnes of smelting capacity a year, because the whole project will be determined by electricity fees and Beijing's approval, he said.
The plant is set to be built near a new hydro-electric power station, which is expected to provide cheaper electricity to the energy-intensive aluminium smelter, he said.
Preparation work for the construction of the hydro-electric power station has nearly finished and the building is expected to start soon.
But construction of the aluminium project may face hurdles given that Beijing has repeatedly warned that the country has overcapacity in the aluminium industry and aims to phase out combined 800,000 tonnes of old smelting capacity by 2010. [ID:nSP517410]
China, the world's top aluminium producer, has 20-30 percent excess production capacity of primary aluminium, Xiong Weiping, the chairman of China's top aluminium firm Chalco (2600.HK) said this month. [ID:nPEK18496]
China's annual smelting capacity has surpassed 18.5 million tonnes. Officials expect capacity to reach nearly 20 million tonnes by the end of this year.

RUSAL announces new executive appointments in its Aluminum Division
SteelGuru - Oct 28, 2009
RUSAL has announced the appointment of Mr Yuri Moisseev former MD of the Nadvoitsy aluminum smelter as the new MD of the Bogoslovsk aluminum smelter. Mr Alexander Krasovitski the current director of RUSAL Production Systems Department at RUSAL Krasnoyarsk is appointed to the position of MD of the Nadvoitsy smelter, whilst Mr Oleg Burkatski former MD of the Bogoslovsk aluminum smelter will take over from Mr Alexander Krasovitski as the new head of this department at the Krasnoyarsk aluminum smelter.
These appointments come as part of the RUSAL human resources development program focused on exchanging the best practices, enhancing executive expertise, raising operational efficiency and introducing the RUSAL production system on the Group’s production sites. Amidst the evolving economic climate, RUSAL has revised its strategy and set new objectives for the Aluminum Division which give more responsibilities and authority to the aluminum smelters and their managing directors.
Mr Alexey Arnautov head of the Aluminium Division said that "One of the key challenges for the heads of RUSAL’s production sites is to transform their facility into ‘a business unit’. The new management style at the aluminum smelters and the recently adopted motivation program will encourage the production sites to achieve the best possible performance, through a series of new opportunities such as channeling their own profit to the development of the technology and operations, as well as motivating their staff and promoting social projects for local communities."
One of the key elements of increasing the effectiveness of the production process is RUSAL production system. Its introduction as a pilot project began at KrAZ under the management of Mr Oleg Burkatski 4 years ago. Today the smelter is creating an educational centre that will encourage sharing experience of production system introduction with other facilities of the company.

Columbia Falls Aluminum shuts down after power agreement falls through
Great Falls Tribune - October 30, 2009
COLUMBIA FALLS (AP) — Columbia Falls Aluminum has ceased operations after failing to reach an agreement on electricity with the Bonneville Power Administration despite months of negotiations — leaving 88 employees without a job.
The company had for years been able to buy discount electricity from the power administration, a quasi-governmental outfit that for decades sold at-cost electricity to big industrial customers. But critics successfully argued that the arrangement came at the expense of other rate payers, and in December a court ordered Bonneville to end its deal with the aluminum company.
CFAC spokesman Haley Beaudry said Bonneville might be drafting a short-term agreement that would be open to public comment, but he didn’t know what such an agreement would include.
"If there’s any way to save these jobs, it’s worthwhile," he said.
"I wish we had been able to come to a solution before this."

Tentative power deal with BPA looks good for Intalco smelter
Bellingham Herald - JOHN STARK - October 30, 2009
A proposed new power deal between Alcoa Inc. and the Bonneville Power Administration could keep the Alcoa Intalco Works aluminum smelter operating for at least another year and a half, preserving as many as 500 local jobs.
Mike Rousseau, Intalco general manager, said the potential deal, announced Friday, Oct. 30, was excellent news for the company, the workers on its payroll, and as many as 1,500 other people whose jobs are indirectly based on Intalco's operations.
But he cautioned that the deal was not yet final, and said previous tentative agreements have fallen apart before they could be completed.
"Lucy's teed the football up for us several times," Rousseau said. "We've had the football pulled away so many times it's hard to get real pumped up about it, but it's a real good deal for us."
Among other things, the deal would guarantee 285 megawatts of power to Intalco for the next 19 months. The smelter now uses 320 megawatts to run two of its three potlines.
Rousseau said the deal also contains provisions that could allow Intalco to get up to 320 megawatts if economic calculations show the deal won't be too costly to BPA.
But as of now, any BPA power deal with Alcoa is on shaky legal ground. Other regional power users have until Nov. 9 to comment on the new proposal.
In the past, some public utility districts have gone to court to challenge BPA's legal authority to provide power to Alcoa. They argue that the public utilities are legally entitled to get preference in the distribution of the region's limited supply of low-priced Columbia River hydroelectric power.
In August, a federal appeals court partially upheld the challengers' legal theory, ruling that any power supply deal between BPA and Alcoa must provide a "net economic benefit" to the region.
During the 19-month term of the latest power deal, BPA would have a chance to get the courts to clarify their interpretation of federal law that governs the agency's power sales to the region.
After that, the proposed deal would enable Alcoa to buy power for an additional five years, if economic conditions warrant, Rousseau said.
Pat Flaherty, representative of the International Association of Machinists and Aerospace Workers Union local that represents Intalco workers, credited strong community support and a strong labor-management relationship for the latest positive news.
"We've been fighting this battle for an awfully long time," Flaherty said. "Union and management work together out here.
Flaherty and Rousseau also credited behind-the-scenes efforts of U.S. sens. Patty Murray and Maria Cantwell, U.S. Rep. Rick Larsen, and Gov. Christine Gregoire in helping to keep BPA receptive to a deal.
But BPA power sales to Alcoa are less popular outside of Whatcom County. That's because BPA doesn't have enough cheap hydropower for all of its customers.
In order to supply power to Intalco, BPA will have to supplement its available supply by purchasing more expensive power, and the cost of that power will be shared by all BPA customers.
An aluminum smelter's appetite for power is enormous. At two-thirds capacity, Intalco uses 320 megawatts of power. That's enough power to light up 320 million 100-watt bulbs, and is roughly equivalent to about one-fourth of the power consumption of the city of Seattle.
Alcoa's opponents claim that over the roughly seven-year life of the proposed BPA-Alcoa deal, other power users would pay an additional $400 million on their electric bills.

European Aluminium Market for Rolled and Extruded Products
MetalMiner - Stuart Burns - October 30th, 2009
The aluminum semis market in Europe is still in the doldrums according to reports we are hearing from the market place. Mills have tried introducing modest price increases in the third quarter but with demand still not picking up the increases have been accepted only in some areas. Automotive demand has picked up due to scrap schemes but in itself that is not enough to materially move the automotive market, particularly as many of the schemes encourage small car purchases. So while unit volumes are up, total tonnage is down. As schemes are phased out so will the rise in demand. Construction, another big consumer, is still deeply depressed having all but ground to a halt in some commercial markets like the UK and southern Europe. Lead-times for most extruders appear measured in weeks, typically 1-2 weeks, rather than the 1-2 months of early 2008.
Markets like the UK are facing rising domestic costs due to a weakening pound and higher metal prices feeding through from the late second quarter onwards. Prices are likely to move higher still in early 2010 not due to the LME but the weakening pound/euro exchange rate feeding through into new deliveries.
Flat rolled deliveries have fared much like extrusions. Mills have tried to impose small increases but with limited success. Demand is still weak as the supply chain refuses to re-stock in any meaningful way and yet mills have plenty of capacity available to meet short term demands so even distributors are disinclined to re-stock.
Meanwhile, China is likely to feature as a supplier into Europe again following adjustments to the export rebate scheme. Foil and plate now enjoy a 14% vat export rebate and the duty on profiles (other than bars) has been replaced with a rebate of 11%. Aluminum bars under 65mm diameter are subject to a 5% export duty and over 65 mm to a 15% export duty but that probably won’t bother them as domestic demand is still strong in the bar market. Expect more flat rolled material to make its way onto the world market though in the fourth quarter.

Alcoa to Supply Aluminum Materials for China-made Jumbo Jets
Trading Markets (press release) - Fri. October 30, 2009
NEW YORK, Oct 30, 2009 (SinoCast Daily Business Beat via COMTEX) -- AA | Quote | Chart | News | PowerRating -- Alcoa Inc. (NYSE: AA | Quote | Chart | News | PowerRating) will supply aluminum materials to the development of the C919 aircraft, a new passenger plane developer by Commercial Aircraft Corporation of China Ltd (COMAC), according to Harry Kiskaddon, head of Alcoa's aerospace division.
Recently, Alcoa, a world-known aluminum producer in the US, and COMAC, the operator of China's jumbo aircraft program, signed a cooperation agreement.
China expects to sell the C919 all over the world. The 190-seat aircraft will be assembled in Shanghai, the economic engine in east China, with parts provided by manufacturers around the globe. The first one is predicted to be delivered and start service in 2016.
The C919 will be the largest passenger aircraft developed by China, stressed Wu Guanghui, chief designer of the proprietary jumbo aircraft program and vice president of COMAC.
China aims to work out an efficient, high-performance, and globally competitive plane, so it needs to pay attention to design alternatives and join hands with innovative materials technology leaders, such as Alcoa, he added.
Source: (October 30, 2009)