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Abu Dhabi: Emirates Aluminum (Emal) on Wednesday denied reports suggesting it will face a shortage in energy supplies needed for the company to operate at full capacity.
Emal is constructing what is planned to be the world's largest aluminium smelter. The facility, with the capacity to produce 700,000 metric tonnes of aluminium annually by the end of the first phase, which will cost $5.6 billion, to generate $2 billion of revenues according to today's prices.
"We have signed agreements and commitments from the Abu Dhabi government and our partners for securing the necessary natural gas required for our operation for at least thirty years," Duncan Hedditch, Emal's CEO, said onday.
With several mega aluminum smelters under construction in the region, especially in Qatar, several reports suggested the company could face difficulty in securing its gas supplies.
Emal, a joint venture between Mubadala Development Company and Dubai Aluminum, has committed to more than Dh9 billion ($2.4 billion) worth of contracts, including a Dh1.8 billion contract with General Electric, and a Dh700 million contract with Alstom for the facility's gas treatment centres, the largest in the aluminium industry.
"The natural gas will be available at the site in July 2009, while the smelter's first phase is scheduled to be fully operational by the second quarter of 2010," said Yousuf Bastaki, the company's project manager.
Emal seeks to construct a business model which is environmentally-friendly while reducing the cost through preferential energy prices and advanced technologies, though senior executives refused to reveal any details related to the energy supply contract.
Feasibility studies
Emal is also working with Masdar on a technical and economic feasibility studies for capturing carbon dioxide, to further minimise the impact on the environment.
Hedditch said: "Prior to construction, we have cleared the site from all living creatures, especially endangered species. Our water cooling and treatment facilities will ensure there is no impact on the environment when we start production."
He added that several sister industries and mining facilities are being acquired by Mubadala Development in Kenya, West Africa, especially Nigeria, in addition to Saudi Arabia.
"This smelter project will secure about 2,000 jobs, in addition to many other jobs that will be created in other related segments of the economy," Marwan Al Sawaleh, general manager, human resources, said.
He said training facilities will be on-site to qualify local labour as well as upgrade staff performance to the high standards of technology to be applied.
Financially, Emal has secured a package of bank-lines worth $4.85 billion through a syndication, while the remaining $750 million will be arranged through equities, Hedditch said, denying any reports referring to bond issues.
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