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Dubai: Emal International, a joint venture of Abu Dhabi's Mubadala Development Company and Dubai Aluminium Company (Dubal), will set up an aluminium smelter complex in Saudi Arabia at a cost of $5 billion in a bid to boost the company's expansion abroad.
Emal has signed an agreement with real estate developer Emaar Economic City to set up the plant in the latter's King Abdullah Economic City (KAEC) development, according to a joint statement that did not provide details of their partnership.
The smelter will produce 700,000 tonnes of raw aluminium per year in the first phase but capacity can be doubled. Work on the Saudi project is expected to start by year-end.
Emal is also developing an aluminium smelter of 1.4 million tonnes capacity in two phases in the upcoming Khalifa Port and Industrial Zone in Abu Dhabi's Taweelah area, and production is scheduled to begin in 2010.
The smelter at KAEC, a mixed-use project that covers 168 million square metres of area on the Red Sea and includes a sea port and industrial zone, will be among the largest such industrial facilities in the region. It will create more than 2,500 direct and 5,000 indirect jobs, the project's promoters said.
Investment
"KAEC has set a strong foundation for inward investment in a number of high-growth sectors. The aluminium smelter complex will be another magnet for industries exploring the investment options," said Amr Bin Abdullah Al Dabbagh, governor of the Saudi Arabian General Investment Authority (Sagia), which has approved the smelter.
Gulf states are building smelters to satisfy global demand for aluminium, used for making a variety of products from drink cans to aircraft. Energy and alumina, the raw material used for producing aluminium, account for the bulk of a smelter operating costs and the Gulf is taking advantage of its cheaper and abundant energy.
Dubai and Bahrain have operating smelters, while construction is under way on smelters in Qatar and Oman.
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