AluNews - December 2016

Metro Mining moves to compulsory acquisition of Gulf Alumina

Proactiveinvestors - December 21st, 2016

Metro Mining (ASX:MMI) will have one of the largest independent projects within the internationally acclaimed Weipa bauxite producing region, following the completion of the acquisition of Gulf Alumina.

The company has received acceptances representing 57.3% of Gulf's issued capital taking its interest in the company to 96.6%.

Metro now has received acceptances from 80% of the Gulf shareholders to whom the offer was made and its interest in Gulf has increased to 99.7%.

Metro will now commence compulsory acquisition of the remaining Gulf shares.

Simon Finnis, chief executive officer for Metro, stated that the combination of the projects will benefit all stakeholders, including shareholders, traditional owners, and the State and Federal Governments, as well as the local economy.

"Recent meetings with our traditional owners confirmed their support for Metro's combined approach, which will minimise impact on the environment.

"The combined Bauxite Hills Project will also improve capital and operating efficiencies, streamline regulatory approvals, improve project financing and enhance product marketing opportunities.

"Our sights are firmly set on expediting the combined Bauxite Hills Project through to production."

Analysis

The successful takeover of Gulf adds to a string of achievements by Metro this year.

In October 2016 the company signed a binding offtake agreement with China's Xinfa Group for 7 million tonnes of bauxite to be delivered over the initial four years of mining.

In July, UK based Greenstone Resources invested A$8.9 million in the company and conditionally committed to investing a further $US20 million in the development of Bauxite Hills.

Native Title and Land Access Agreements were also finalised early in the year.

Alcoa says Australia aluminium smelter running at 30 pct capacity

Yahoo Finance - December 21st, 2016

SYDNEY, Dec 21 (Reuters) - Australia's 300,000-tonnes-per-year Portland aluminium smelter is operating at below a third of its capacity after power to the plant was temporarily knocked out three weeks ago, operator Alcoa Corp said on Wednesday.

The smelter was hit when a power interconnector between the states of Victoria and South Australia went down, cutting power to both of the plant's potlines, and raising questions about its long-term future.

"The smelter has been operating at less than 30 percent capacity since a fault on the Victorian transmission network on Dec. 1 caused a more than five-hour power outage at the plant," Alcoa said in a statement.

It said Alcoa Chief Executive Roy Harvey met with Australia's industry minister Greg Hunt in New York this week, and expressed appreciation for the extensive assistance offered to restart the smelter's lost production.

Alcoa said in May it would continue to implement cost saving measures at the Portland smelter, but its future would be decided by an ability to remain internationally competitive.

A recent rise in electricity prices had added to pressure on the smelter, which has also been battling a years-long glut in the global aluminium market.

Australia has been looking at the possibility of deploying funds from its Clean Energy Finance Corp to help build a new gas-fired power station to supply the smelter, or using wind turbines to supply the works.

Harvey said Alcoa was "committed to continue working" with Australia's federal and state governments.

A shutdown of the smelter would not affect Alcoa's Australian refineries that supply the alumina that is processed at the smelter, according to the company.

New Fort William smelter owners plan to create 300 jobs

Daily Record - December 19th, 2016

GFG Alliance plan to invest £120m in the site adding a new aluminium wheel manufacturing facility, with a further 300 jobs expected to be created along the supply chain

The buyers of the aluminium smelter plant in Fort William plan to create up to 300 new jobs at the site.

GFG Alliance, comprising shipping to mining conglomerate SIMEC and steel to engineering conglomerate, Liberty House Group, plans to invest £120 million in the site it purchased from mining giant Rio Tinto last month in a £330 million deal.

The aluminium smelter in Fort William is powered by two hydro electric schemes located in Fort William and Kinlochleven, which were also purchased as part of the deal.

Plans for the site include a new aluminium wheel manufacturing facility, which will see around 300 new jobs being created directly, with a further 300 jobs to expected to be created along the supply chain.

The site, which already employs 170 staff, will be expanded to accommodate growth in manufacturing and downstream engineering.

First Minister Nicola Sturgeon, who will visit the site today, said: "Today is the start of an exciting new chapter in Scotland's manufacturing story and the Scottish government and its agencies will keep working with Sanjeev Gupta and the GFG Alliance to help them realise their enterprising vision for Lochaber."

Liberty House executive chairman, Sanjeev Gupta, said: "We hope this day will come to be recognised as the start of a bright new future for Highland industry.

"It puts Lochaber right at the heart of our vision for sustainable and integrated local production that can revitalise British manufacturing."

Metals tycoon Sanjeev Gupta to rescue UK's last aluminium smelter

The Telegraph - December 18th, 2016

The metals tycoon Sanjeev Gupta will pledge today to invest £120m in Britain's last aluminium smelter, as part of a deal to rescue the site and safeguard hundreds of local jobs.

The Gupta family is planning to buy the plant in Lochaber, in the western Scottish Highlands, and the pair of hydro-electric plants that power it, upgrade equipment and set up an aluminium wheel manufacturing facility. Mr Gupta's Liberty House and his father's Simec business will pay £330m for the assets and immediately invest a further £120m.

Nalco puts $2bn Iran project on hold

Odisha Tv - December 14th, 2016

Bhubaneswar: Aluminium major National Aluminium Company (Nalco) has decided to keep its proposed $2billion smelter unit in Iran in abeyance due to global downturn in aluminium market.

The State-owned company is expected to review its decision sometime early next year, a company official said.

"Looking at the volatility in global aluminium market, it will not be wise to invest in our proposed plant in Iran now. We will take a call on this early next year", said Tapan Kumar Chand, CMD, Nalco, on the sidelines of a business conclave of a national daily.

Asked if the project is shelved, Chand replied in negative.

"It will also be assessed whether production of aluminium in that country will be cost-effective", he stated.

In May, Nalco had signed a Memorandum of Understanding (MoU) with Iranian Mines & Mining Industries Development Renovation Organization (IMIDRO) to jointly explore the possibility of setting up an aluminium smelter in Iran. The smelter-cum-gas based power plant is slated to be part of a joint venture aluminium company to be set up by Nalco in that country. It will utilize supply of alumina from Nalco's refinery in India.

However, industry experts observe that Nalco's decision to hold back its project visibly stems from the Union Mines ministry's direction to it. After Nalco signed the MoU, Mines minister Piyush Goyal had asked the company to do a rethink on its overseas smelter plans and, instead, focus more on value addition in the country. The ministry has asked Nalco to draw up a roadmap to expand aluminium production capacity to 2 mtpa, up from 0.46 mtpa now. Official sources said Nalco had set a target to reach its full rated capacity (of 0.46 mtpa) in the next financial year.

Besides during the Make in Odisha conclave held earlier this month in the state capital, Goyal had asked Nalco to reconsider regarding the investment.

Speaking on the sidelines of the mega event, Goyal said: "So far they (Nalco) are looking at setting up a plant in Iran. So I have asked the board to reconsider that."

"I believe that we should make in India… Ideally it should be in Odisha where the material is mined," he added.

Also read: Odisha stands fourth in child adoption

The State-owned major has, however, kept its options open to go for a toll-smelting arrangement with some Iranian companies. Under this proposal, Nalco will divert a portion of its surplus exportable alumina to the Iranian smelters for conversion to aluminium. Through toll-smelting, Nalco intends to convert its alumina, currently exported to the international market, to aluminium by paying a tolling fee to the concerned companies.

"We are in the process of analysing the price offers for gas supplies which some Iranian companies have sent to us. Soon we will finalise these", Chand stated.

Balco to Ramp Up Bauxite Production at Chhattisgarh Mines

Aluminium Insider - December 9th, 2016

India's Bharat Aluminium Company (Balco) said recently that it intends to increase bauxite ore production in an effort at meeting its raw material shortfalls.

Currently Balco is harvesting two million metric tons per annum from its two allotted mines in Chhattisgarh. However this is not sufficient to meet the aluminium production boost at its Korba facility, which now churns out 570 thousand metric tons per annum.

Balco is currently meeting demand via aluminium powder imports from Australia. However, this means for alleviating Balco's significant lack of raw materials is expensive.

According to a Balco spokesperson, the company is planning to boost production from its two mines in Chhattisgarh to a combined level of five million metric tons per annum.

"While the production in Sarguja mine would be increased to 2 mtpa, the Kawardha mine would be expanded to 3 mtpa," said the spokesperson.

In order to do that, Balco will need to obtain permission to increase production. Balco has permission to mine 2 million metric tons per annum combined at the two mines at present. In addition, the mine at Sarguja would need to be re-started, as it has been shuttered for the past four years.

A production boost at the mines would be a worthwhile increase, but it would be only a temporary fix – the mines will last between three and five years. Balco will be seeking more mines to replace the shortfall, possibly including the two bauxite mines with a combined capacity of 20 million metric tons that are scheduled for auction in the near future.

Such a boost would propel Chhattisgarh from the third- to the second-biggest aluminium producing state in India, accounting for thirty-five percent of India's total.

Balco was founded as a state-owned company ("public-sector undertaking") in 1965. It began production of aluminium nine years later. The firm was entirely state owned until 2001, when it divested 51% of its stock to Sterlite Industries India Limited. The Indian government continues to hold a 49% stake in the company.

Pollution forces massive alumina, bauxite shutdowns in Shanxi, Henan

Industrial Minerals - December 9th, 2016

Some provincial governments in China have taken extreme measures to combat heightening air pollution levels in the region by enforcing additional production shut downs in Henan and Shanxi. Although many buyers have yet to be hit by this latest output disruption, many are expecting price hikes in refractory minerals due to the supply shortage.

Many fused-alumina and bauxite producers in Shanxi and Henan provinces in China have been forced to shut down by local government this week amid worsening pollution levels in the region.

This wide-scale crack down on polluting plants comes after the ministry of environmental protection (MEP) urged local authorities in six...

Nalco Sees Alumina, Aluminium Output Rising In 2016-17

NDTV Profit - December 9th, 2016

Bhubaneswar: National Aluminium Company Ltd expects its output to rise 3.5 per cent in the year to March 2017 as it seeks to take advantage of growing local consumption and higher prices, its chairman said on Friday.

The state-run company will end the fiscal year with an aluminium output of 385,000 tonnes, higher than the 372,000 tonnes it produced a year earlier, Tapan Kumar Chand told Reuters.

"Nalco is ramping up this production... to take advantage of growing consumption in the domestic market, and... to take volume variance," NALCO chairman Tapan Kumar Chand told Reuters, explaining that narrow margins have prompted the company to increase volumes to boost profits.

The company expects to increase its alumina output by 9.1 per cent in fiscal year 2016-17 to 2.13 million tonnes and the alumina refinery's capacity utilisation to 93.62 per cent from 85.85 per cent, Mr Chand said.

Alumina, produced from bauxite ore, is the primary input for making aluminium. The process is highly power intensive.

The company had kept its production low previously because the cost of coal to feed its refinery and smelter had risen, Mr Chand said.

But "right now coal is available. You can say sunny days are ahead," he added.

Analysts had been expecting lower energy costs and firm prices to help the company to post better margins and higher revenues in the coming quarters.

Nalco, three-quarters owned by the government, runs a 2.28 million tonne alumina refinery, a 460,000 tonne aluminium smelter and a 1200 megawatt power plant in Odisha.

Hydro's New Line in Germany Produces First Rolled Aluminium

Aluminium Insider - December 8th, 2016

Norsk Hydro's newest line at Grevenbroich, Germany began to produce rolled aluminium this week following weeks of pre-production trials and testing.

The new equipment represents a €130 million investment by Hydro, which is the firm's largest single capital expenditure in Germany.

In addition to the initial marketable rolled aluminium production, the equipment was also used to turn out strips for testing by automobile manufacturers to qualify the material for future use in auto parts production.

"To get this challenging, innovative installation going on time and within its planned cost, is quite a strong accomplishment," explained Pascal Wagner, Senior Vice President of the Global Products Business Unit. "Kudos and cordial thanks to the team, with our engineers, specialists and scientists, not least the partners for construction and technology."

The project, which took eighteen months to construct, will be used by Hydro to meet a continually increasing demand for automotive aluminium.

"Only will we celebrate AL 3, when this plant will provide premium quality to our customers in a regular routine rhythm in 2017," Wagner continued. "Until then we focus on ramping up AL 3 and finish its numerous qualifications at customers successfully."

Norsk Hydro, which was founded in 1905, financed by the Swedish Wallenberg family and French banks, began its life named Norsk hydro-elektrisk Kvælstofaktieselskab (literally, "Norwegian hydro-electric nitrogen limited") by Sam Eyde. The Norwegian government owns approximately 40% of the company at the present time. Norsk Hydro is one of the largest aluminium companies in the world, with plants in Rjukan, Raufoss, Vennesla, Karmøy, Høyanger, Årdal, Sunndalsøra, and Holmestrand. Norsk also has several plants abroad, including in Germany and Brazil.

Balco to boost bauxite production in Chhattisgarh mines

Business Standard - December 7th, 2016

The company has been meeting its demand for raw materials by shipping aluminium powder from Australia so far

Vedanta-controlled Bharat Aluminium Company Limited (Balco) is planning to enhance its bauxite production to meet the raw material crises.

At present, Balco is producing 2 million tonnes per annum (mtpa) of bauxite from the two mines it had been allotted in Kawardha and Sarguja districts of Chhattisgarh.

The company had enhanced its aluminium production to 5,70,000 tonnes per annum in its Korba facility.

Even as Balco reels under severe raw material crises, it has been meeting the demand by shipping aluminium powder from Australia. But the process has been a costly affair. The company now plans to expand the production in its two mines.

According to the company's spokesperson, Balco was looking to increase production to 5 mtpa. "While the production in Sarguja mine would be increased to 2 mtpa, the Kawardha mine would be expanded to 3 mtpa," said the spokesperson.

At present, the company has clearance for mining 0.75 mtpa and 1.25 mtpa bauxite from Sarguja and Kawardha mines respectively. Sarguja mine would resume operations after nearly four years as production was suspended for a brief period in-between.

Both the mines would be a breather for Balco even though neither of them has a big reserve. They will, however, last for 3 to 5 years. In the meantime, the company will be looking for more mining sites in the state. Incidentally, two bauxite mines with a capacity of about 20 million tonnes are set for auction, according to mining department officials.

London-listed Vedanta has a 51 per cent stake in Balco, while the remaining share belongs to the Indian government.

After the capacity expansion in Balco, Chhattisgarh would emerge as the second largest aluminium producing state in the country. Earlier, the state was ranked third. The enhanced capacity would also help Chhattisgarh to produce 35 per cent of the country's aluminium.

Greens under fire over call to fast-track Alcoa smelter closure in Portland

The Weekend Australian - December 6th, 2016

The Greens have been slammed for urging the fast track of a "transition task force" that would see the closure of the aluminium smelter in Victoria's Portland and impact thousands of jobs.

Australian Workers' Union secretary Ben Davis said it smacked of enthusiasm "for ridding the region of jobs critical to its ongoing wellbeing".

The future if the Alcoa smelter was thrown into doubt after a power outage last week caused liquefied aluminium to solidify, with 60 per cent of its manufacturing capacity out of action.

Analysts had already predicted that the smelter may be forced to shut due to low aluminium prices and rising energy prices resulting from the coming closure of the Hazelwood brown coal power station in the Latrobe Valley.

"The Greens are very quick to sound the death knell of any heavy industry, apparently oblivious to realities of life for working people," Mr Davis.

"People need jobs if communities are to survive. The Greens should attempt to temper their blind enthusiasm for destroying blue-collar jobs with a little compassion and common sense.

"It is becoming bleedingly obvious that the Greens' best-case scenario all too often coincides with the worst-case scenario for those who earn a living in manufacturing.

The 30-year-old smelter, about 350km southwest of Melbourne, directly employs 680 people and supports about 2000.

The council of the 10,000-resident town has warned its closure could reduce Portland's population by 30 per cent and send unemployment to more than 10 per cent.

The union and the state and federal governments are in consultation with the majority owner in an effort to keep its doors open.

The Greens also were slammed for cheering about the closure of the Hazelwood coal mine last month, just hours after 700 workers found out they would lose their jobs.

"Together we did it! Australia's dirtiest power station will close!" the Greens posted on Facebook, with the comments defended by federal party leader Richard Di Natale.

Rusal sells Apart

Aluminium International Today - December 6th, 2016

UC Rusal has completed the sale of a 100% stake in Alumina Partners of Jamaica ('Alpart') to the Chinese state industrial group, JIUQUAN IRON & STEEL (GROUP) Co. Ltd. ('JISCO') for a USD 299 mln cash consideration.

The divestment of Alpart does not affect Rusal's 100% self-sufficiency in alumina. Vertical integration into efficient upstream assets remains one of the key pillars of Rusal's strategy.

Alpart (Alumina Partners of Jamaica) is a large production complex in Jamaica, which uses its own bauxite mines to feed alumina production. Before the suspension of operations at Alpart between 2009 and 2015, annual production capacity of the complex was 1.65 mln tonnes of smelter-grade alumina and 4.9 mln tonnes of bauxite. RUSAL acquired a 65% stake in Alpart in 2007, following the merger of the company's assets with the alumina assets of Swiss-based Glencore. Since acquiring the remaining 35% of Alpart in November 2011, Rusal has owned 100% of Alpart.

The deal received the required approvals by UC Rusal's Board of Directors and is in line with management efforts directed at Rusal's asset portfolio optimisation.

On July 19, 2016, UC Rusal and JISCO entered into an Interest Purchase Agreement for the sale of a 100% stake in Alumina Partners of Jamaica ('Alpart').

Vedanta rises on plan to invest Rs 20,000 crore over three years

Livemint - December 5th, 2016

Vedanta is currently trading at Rs 225.15, up by 2.25 points or 1.01% from its previous closing of Rs. 222.90 on the BSE.

The scrip opened at Rs. 222.90 and has touched a high and low of Rs. 226.10 and Rs. 222.05 respectively. So far 290493 shares were traded on the counter.

The BSE group 'A' stock of face value Rs. 1 has touched a 52 week high of Rs. 233.65 on 10-Nov-2016 and a 52 week low of Rs. 58.10 on 12-Feb-2016.

Last one week high and low of the scrip stood at Rs. 233.60 and Rs. 220.15 respectively. The current market cap of the company is Rs. 66794.56 crore.

The promoters holding in the company stood at 62.86%, while Institutions and Non-Institutions held 23.24% and 9.60% respectively.

In order to expand its alumina and aluminium producing capacity, Vedanta is planning to invest Rs 15,000 to Rs 20,000 crore ($2.93 billion) over three years. The company wants to expand the capacity of its Lanjigarh alumina refinery to 5 million tonnes from the current 2 million tonnes and double the capacity of its Jharsuguda aluminium smelter to 2 million tonnes. Both these plants are located in the state of Odisha.

Vedanta is an India-based global diversified natural resources company with operations across zinc, lead, silver, oil and gas, iron ore, copper, aluminum and commercial power. The company operates through segments, including Copper, Aluminium, Iron Ore, Power and Others

UPDATE 1-Alcoa assessing impact of Portland smelter outage, says faces challenges

Reuters - December 5th, 2016

Dec 5 Aluminium maker Alcoa Corp said on Monday it was assessing the impact of a power outage last week at its Portland smelter in Australia that forced it to halt a potline, adding that it was facing 'substantial challenges'.

The smelter was hit when a power interconnector between the states of Victoria and South Australia went down on Thursday, knocking out power to both of the plant's potlines for about five-and-a-half hours.

"We are now beginning to assess the operational impact of the outage and, given the significance of this event, we have substantial challenges and analysis ahead of us. As that work is completed, we will provide an update," Alcoa said in a statement.

Speculation has grown about the future of the Portland smelter after a recent rise in electricity prices added to pressure from a years-long glut in the global aluminium market.

A long power outage can cause molten aluminium to solidify in the potline's cells, from which it has to be chiselled out. The blackout also disrupted production at a second potline, although a portion of it was still operating, Alcoa said. A spokesman declined to give further details.

Analysts said the power outage could further jeopardise the future of the smelter, given the expense and time required to restart damaged potlines. An Alcoa spokesman said at the time that the company was not speculating about the future of the plant.

The smelter, co-owned by Alcoa, CITIC Resources and an arm of Marubeni Corp 8002.T, produces about 300,000 tonnes of aluminium a year. (Reporting by Melanie Burton; Editing by Richard Pullin