Bauxite Resources Limited (ASX:BAU) Quarterly Activities and Cashflow Report

ABN NEWSWIRE - October 29th, 2012,

Melbourne, Oct 29, 2012 (ABN Newswire) - Bauxite Resources Ltd (ASX:BAU), and its joint ventures has increased its overall JORC compliant bauxite resource base to 142.3 million tonnes with a new bauxite resource defined at the Bauxite Alumina Joint Ventures (BAJV) Cronus deposit approximately 15km east of Boyup Brook, Western Australia. This is the first bauxite resource defined in the Boyup Brook area by the BAJV.
Further drilling in the southern tenements is currently underway, and planning for future exploration work is occurring although no immediate follow up work is planned for the Cronus deposit.
BRL considers the JORC resource increases achieved over the last 12 months to be an excellent result that significantly improves the opportunities for the Company and its joint venture partners to develop bauxite mining operations in the south west of Western Australia (WA).
The Company now has a number of potential mining projects in its portfolio and over the coming months will, together with its JV partners, identify those that should be prioritised for development.

Norsk Hydro: Soral secures power for continued operation

MENAFN.COM - October 29th, 2012,

OSLO - Sor-Norge Aluminium (Soral) primary aluminium plant in Norway hassigned electricity contracts with Agder Energi, Lyse, Statkraft andHydro for the long-term annual supply of up to 2.6 terawatt hours(TWh) of electricity in Norway over an eight-year period, starting in 2013.
"We are pleased that Soral has been able to secure power supply,paving the way for continued operations at the plant. We have workedhard to achieve this, andwe are happy that all pieces came togetherin the end," says CEO Per OyvindSaevartveit at Soral.
The combined contracts, together with necessary clarificationsconcerning implementation on CO(2) compensation, will secure the basisfor continued commercial operations at the Soral aluminium plant atHusnes, owned by Rio Tinto Alcan and Hydro. The plant's current powersupply contract expires in December 2012.
"This is a milestone for Soral and for Hydro as part owner, and veryimportantfor our Norwegian aluminium operations," says HydroPresident and CEO Svein Richard Brandtzaeg. "It shows that Norwegianindustry and power producers jointlycan find solutions that ensurethat Norway keeps its position as a location foraluminium productionwith clean, renewable power. In our view, this is good forHydro, forNorway as an industrial nation and for the global climate."
Soral curtailed one of two potlines following the financial crisis in2009, and is currently producing around 90 000 tonnes aluminium peryear. The plant's production capacity with both potlines in operationis around 185 000 tonnes peryear. At full production the plantemploys around 340 people. Currently, 250 areworking at the plant.
The renewed power sourcing will not lead to an immediate increase inproductionat Soral.
"With renewed power sourcing, we will continue production with onepotline untilthe owners and Board of Directors decides otherwise,"says Saevartveit at Soral."The power contracts allow for anincreased production at a later stage, shouldmarket conditionsimprove. In the meantime, we will continue our efforts to furtherreduce our cost base and improve efficiency," he says.

Deal to preserve smelter tipped

The Southland Times - October 25th, 2012,

State-owned Meridian may need to negotiate a short-term discount on perhaps half the electricity it sells to the Tiwai Point aluminium smelter at Bluff if the plant is to remain open, a source says.
The smelter, majority owned by Australian miner Rio Tinto, and Meridian, which owns the Manapouri hydro power station supplying the plant, have been in talks about the electricity price.
The smelter operation has been hit by a slump in world aluminium prices, a high New Zealand dollar and increased international competition.
Rio Tinto was under "intense pressure" to get a solution to keep the plant going, but it was also in the Government's interests to strike a deal, the source said.
"My view is that there is a short-term deal to be done [on price]", the source said.
Rio Tinto put the smelter up for sale in October last year. It was still possible the smelter could be sold cheaply to an Asian buyer, who might refurbish the plant and aim to get another 20 years or more out of the operation, the source said.
Given flat demand for electricity, a surplus of generation and the challenges of getting power from Manapouri to other parts of the country, it would be in the Government's interest to strike a deal. That price would have to allow the smelter to operate profitably, rather than making a loss.
However, grid operator Transpower has said that if the smelter closed it would cost about $170 million to re-route the power out of Southland and electricity market prices throughout the country would fall as a result of the glut of supply.
But Rio Tinto would be well aware of the social impact of shutting down the plant employing about 800 people in Southland. So Rio Tinto was likely to keep the plant going if they could get a "slightly positive outcome" on the smelter's returns.
"I don't think you are talking about the whole power supply [being discounted]," the source said.
The electricity contract could for example be broken into half on the existing contracted price, and half at a lower price. The discounted price on electricity might have to be for a "fair period" but not for years.
World aluminium prices have slumped from US$3000 a tonne before the global financial crisis hit to US$2500 a tonne late last year, to just under US$2000 a tonne now.
"Rio is facing a pretty serious challenge . . . I would think they are under intense pressure to come to a solution," the source said. Smelter general manager Ryan Cavanagh said yesterday that NZAS "continues to operate in very tough business conditions - a combination of the high New Zealand dollar, low metal prices and increased international competition.
"Much has been done to improve the smelter's competitiveness and viability over the years and particularly over the past year," he said, but would not comment directly on NZAS's accounts.
It is still possible that Rio Tinto will sell the smelter, possibly to a Chinese operator or another Asian smelter company.
"They would get it for a very cheap price," the source said.

Gove alumina operations may close to cut costs

ABC - October 24th, 2012,

Operations at Rio Tinto's alumina facilities at Gove in the Northern Territory could be temporarily suspended.
The ABC understands the mine operator, Pacific Aluminium, called a meeting with workers today to announce it is conducting a strategic review into the bauxite mine and refinery.
The company says the temporary suspension of the refinery, about 600 kilometres east of Darwin, is one of the options being considered by the review, triggered by difficult global market conditions.
Pacific Aluminium says it is also exploring options to switch powering the refinery with gas, instead of more expensive fuel oils. In a statement, the company says it is trying to make the Gove operations financially viable but will not know the outcome of its review until January.
It has already signalled that employees leaving their positions will not be replaced and the use of contractors is being investigated. Chief executive officer Sandeep Biswas says the company is looking at many ways to cut costs.
"One of the options is that we could consider the potential curtailment of Gove (operations) until economic conditions improve," he said. The nearby town of Nhulunbuy, which has a population of about 3,000 people, is almost totally economically dependent on the Pacific Aluminium facility.

$2.5bn Yarwun expansion doubles refinery output

Mining - October 24th, 2012,

PERTH – Aluminium major Rio Tinto Alcan this week officially opened the $2.5-billion Yarwun alumina refinery expansion, in Gladstone.
The expansion project more than doubled production at the refinery to 3.4-million tons a year, said bauxite and alumina CEO and president Pat Fiore.
“The commissioning of the refinery expansion allows additional volumes of bauxite to be processed more efficiently, at lower costs. This means the expanded operations will improve operating costs for the entire Yarwun refinery and the bauxite and alumina portfolio,” he said.
Fiore added that the Yarwun expansion also cemented Rio Tinto Alcan’s commitment as a long-standing member of the community, with the company having invested more than A$500-million in community infrastructure and programmes since 1964.
“And just as importantly, the opening highlights how the Yarwun expansion strengthens the economic, cultural and social ties between Gladstone and Western Cape York Peninsula.”
Rio Tinto Alcan’s Queensland operations – Yarwun and QAL in Gladstone, and the Weipa bauxite mining operations – employ some 3 000 people, contributing more than A$300-million in salaries and wages, as well as A$10-million in royalties and A$6.5-million in community investments.

Rio Tinto Alcan Inc. : Rio Tinto Alcan's Yarwun refinery expansion project opens

4-traders - October 23th, 2012,

More than 600 employees, Gladstone community representatives and local Indigenous leaders joined with Rio Tinto Alcan and Queensland Premier Campbell Newman today to launch the $2.5 billion Yarwun alumina refinery expansion in Gladstone.
President and chief executive officer of Rio Tinto Alcan Bauxite & Alumina, Pat Fiore, said he was delighted that a Traditional Owner representative from Weipa was also on hand to witness the opening.
"The Yarwun expansion project more than doubles production at the refinery to 3.4 million tonnes of alumina per year, enhancing Rio Tinto Alcan's position as one of the world's leading bauxite and alumina producers," Mr Fiore said.
"And just as importantly, today's opening highlights how the Yarwun expansion strengthens the economic, cultural and social ties between Gladstone and Western Cape York Peninsula.
"Together, Rio Tinto Alcan's Queensland operations - Yarwun and QAL in Gladstone, and our Weipa bauxite mining operations - employ approximately 3,000 people and are mainstays of these important regional communities."
Each year, the operations contribute more than $300 million in salaries and wages, $10 million in royalties and $6.5 million in community investments.
"In Gladstone, the Yarwun expansion cements our commitment as a long-standing member of this community. Since construction of QAL in 1964, Rio Tinto Alcan has invested more than $500 million in community infrastructure and programmes, including housing, bridges and roads.
"And as was the case with the construction of the original Yarwun refinery, investing in the local community was a priority throughout the construction of Yarwun 2."
Mr Fiore said that during construction, $1.9 billion was spent on contracts and procurements throughout Australia, including: • $360 million in Gladstone; and • $1.4 billion in Queensland.
Now operational, the refinery expansion provides additional employment for 250 Gladstone locals.
"The commissioning of the refinery expansion allows additional volumes of bauxite to be processed more efficiently, at a lower cost," Mr Fiore said.
"This means the expanded operations will improve operating costs for the entire Yarwun refinery and the Bauxite & Alumina portfolio."
Mr Fiore said he was pleased so many of the Yarwun workforce were able to attend the opening, and he also thanked everyone involved in building the world-class facility, including employees.
"Since its beginnings in 2007, the Yarwun expansion project experienced a volatile global economic environment - not least of which was the sudden arrival of the global financial crisis. The project team successfully responded to these challenges, and consistently delivered reliable assets safely, on time and on budget," Mr Fiore said.
"A refinery is an incredibly complex system, with 230 kilometres of pipe and thousands of interfaces and chemical processes. Only being handed the plant less than four months ago, the expanded refinery is today running about 90 per cent capacity.
"And what is most pleasing has been the relentless focus on safety - during design, commissioning and operation."
Mr Fiore acknowledged the significant contribution the Queensland and Commonwealth governments had made to getting the first stage of the refinery off the ground.
"We really appreciate that the Premier was able to join us today for this important occasion," Mr Fiore said. "Our key focus for the remainder of 2012 is to bring the expanded facility safely into stable operations so that we can gradually increase the plant's capacity to full production next year."

Bauxite unearthed in Queensland

Radio New Zealand News - October 22th, 2012,

Cape Alumina says it has now discovered an estimated 200 million tonnes of bauxite during exploration on Cape York in far north Queensland.
The ABC reports the company holds exploration permits covering 1900 square kilometres in the western Cape region.
"We've got an exploration target of 400 million tonnes and we're halfway there," said spokesman Neville Conway.

Aluminium production ends at Kurri smelter

ABC News - October 22th, 2012,

Four decades of aluminium production officially ends today at the Kurri Kurri smelter when the last aluminium billets are cast.
The smelter has been gradually winding-down since Norsk Hydro announced the closure around six months ago with the loss of around 450 jobs.
By the end of the year the plant will go into mothballs with only a small number of workers to maintain it.
The smelter's acting managing Director Richard Brown says the plant may be re-started in the future if market conditions improve, but concedes that it is unlikely.
"The economic conditions that would allow a re-start not only to sustain and operate the plant but to cover the cost of a re-start and you're right it's not just turn it back on again, you'd have to bring all the equipment back up to an operating standard, engage a whole new workforce," he said.
"Really the clock is ticking because every day that goes by, the equipment deteriorates."
Two thousand hectares of land surrounding the smelter could become a future residential and industrial estate.
Mr Brown says the entire site is very large and diverse.
"So we've got two thousand hectares of land that stretches from Gillieston Heights right through to the Kurri Weston area so we've got rural land, some residential land, of course we've got the smelter site which is industrial, we've got pristine bushland on our site so you know the opportunities, if that were to eventuate are pretty limitless," he said.
Meanwhile, Norsk Hydro's human resources manager Trevor Hall says the mining industry slowdown has put a dent in the hopes of former Kurri smelter employees looking for a new job.
"It's fallen a bit flat although there were some people who got in early soon after we had the jobs market, but obviously with the fall in coal prices, things have been a bit of a squeeze and that's made it more difficult for people in this area but the remaining people are out there still looking for work," he said.

Vedanta Aluminium resumes refinery operations after 10 days production halt - October 22th, 2012,

Vedanta Aluminium Limited (VAL) resumed operations today at its alumina refinery in Odisha's Kalahandi district after operations had been shut for 10 days due to shortage of raw materials.
The company had last month informed the state government that the operations at the alumina refinery would be halted by 5 December, but due to non-availability of bauxite, it had closed down the plant ahead of schedule on 12 October.
According to VAL president Mukesh Kumar who spoke to IANS, the refinery had been re-started at a reduced capacity of 60 per cent after the company managed to arrange around 3,500 tonnes of bauxite from Chhattisgarh and about 90,000 tonne from Gujarat.
The 1 MTPA alumina capacity refinery at Lanjigarh in Kalahandi district had been in operation at reduced capacity since commissioning in August 2007.
Set up at a capital outlay of $800 million, VAL requires 300,000 tonne of bauxite per month to run the refinery at full capacity.
The company wanted to mine bauxite from Niyamgiri Hills near the refinery, however the litigation and protests has held up mining operations.
According to Kumar the refinery might have to be shut down if the company did not manage to get more raw material for the plant.
VAL, an associate company of the London-listed Vedanta Resources had been operating the plant by buying bauxite from different states.
According to a PTI report Kumar said the company now had a stock of about 40,000 tonnes of bauxite. He added around 3,000 tonnes of the ore was being received from Kwardha mines of Balco in Chhattisgarh for the last few days.
Additionally, the company was going to receive 90,000 tonnes of bauxite from Gujarat Mineral Development Corporation (GMDC) he said. He added, the first consignment of 45,000 tonnes was expected to arrive in Visakhapatnam on Wednesday.
Kumar said with this, the company was hopeful of operating about 50 per cent of 1 MTPA capacity.
Negotiations were also under way with exporters and mine owners in Gujarat and Maharashtra for supply of bauxite to the Lanjigarh refinery, Kumar said. He said the company was making all efforts to keep the plant running.

Time to get real on smelter

Power Engineering - October 20th, 2012,

THE TIWAI Pt aluminium smelter has no future. We can deal with its demise in an orderly and economically positive way over the next few years; or chaotically and damagingly later.
It shares its fate with scores of other old smelters around the world. They were built 30-40 years ago to exploit very cheap electricity in remote places. But big changes in technology, electricity markets and the aluminium industry in the past decade have destroyed their economic lives. It is yet another example of China quickly dominating an industry and leaving its competitors in the dust. A decade ago China was only a mid-sized player and its technology was a joke.
But since 2000, it has increased its smelting capacity six-fold to 18 million tonnes a year, 40 per cent of world output. It plans to add another 10 million tonnes over the next three to four years by building huge smelters and power plants in its remote far west. It has abundant reserves of bauxite, the principal ore for aluminium, and is already the world's second-largest producer of bauxite after Australia. It has also become the technology leader in smelting. One New Zealand industry expert reckons the best Chinese plant is at least twice as energy efficient as Tiwai Pt, and enjoys cheaper electricity.
China has rocked the global aluminium industry. Its prodigious expansion has ensured aluminium has missed out on the heady boom of other metals and minerals.
At around US$2000 ($2440) a tonne currently, its price has changed little since 1980. It is by far the worst-performing mined commodity. In contrast, over the same period the price of copper has trebled and iron ore has increased eight fold, according to the IMF. As a result, the stock market capitalisation of the five largest listed aluminium producers has fallen by two-thirds to US$65 billion and profits by 75 per cent over the past five years.
Rio Tinto, which owns 79 per cent of the Tiwai Pt smelter, is a big loser thanks to an astonishingly bad deal it inked in 2007. It lost its head in a bidding war for Alcan, the Canadian-based smelter, paying US$38b, a 65 per cent premium over the market price. Financed almost entirely by debt, it was the biggest takeover ever in the mining sector and the burden has dragged Rio down ever since. The assets are performing so poorly that some 80 per cent of Rio's profits come instead from iron ore. Given the poor medium-term outlook for the aluminium industry and its own disastrous performance, Rio is having to take brutal action. It's investing in its best smelters, shutting its worst, and has bundled A$8b ($10b) of the assets in between into a new entity, Pacific Aluminium, which it has put up for sale.
Tiwai Pt, one of the assets for sale, was once a jewel of its kind, exploiting since 1971 very cheap, captive electricity. The government of the day built the Manapouri hydro scheme to supply the smelter, which has only ever paid a fraction of the price for electricity that other industrial users pay.
But Rio says it must have even cheaper electricity to restore Tiwai's viability. The company said the same about its Bell Bay smelter in Tasmania. In June it persuaded Hydro Tasmania, the state-owned generator, to sign a 13-year agreement on exceptionally favourable terms to keep the smelter open.
Rio is taking the same hard- nosed approach in demanding a deep price cut from Meridian Energy, owner of Manapouri. But there's one utterly crucial difference between the two generators. In a classic case of isolated capacity, Hydro Tasmania had no alterative customers. But Meridian can sell into the national grid, a little now and the rest later, if Transpower accelerates its upgrade of lower South Island lines. So unlike Tasmania, New Zealand does have a choice: we could use the electricity to keep the smelter open. Or we could use the electricity to the greater benefit of the wider economy.
Rio argues the smelter generates significant economic value to the country. But that is highly debatable. It is easy to measure the local benefit of 800 smelter jobs plus more among contractors and in the wider Southland economy. It is a lot harder, though, to measure the net benefit at a national level. For example, Rio and its supporters point to the smelter's $1b of aluminium exports a year. But they ignore the cost of importing alumina, the smelter's raw material, or dividends paid to Rio. Adjusting for such items reduced the annual net exports to one-fifth that level from 2007-2010 in analysis last year by Sue Newberry, an associate professor of accounting in the University of Sydney's Business School.
But the picture would be even worse if the analysis was broadened beyond Dr Newberry's to consider the steep subsidies the smelter gets in terms of cheap electricity and free carbon credits in the Emissions Trading Scheme. A sharp cut in electricity price by Meridian to satisfy Rio would only make the economics worse. There is, instead, a very good case that the electricity would create greater economic benefit if it were available to all users across the country. Manapouri, which has by far the most reliable water storage of all our hydro schemes, generates just the sort of electricity we need: renewable base-load.
If the smelter closed, Manapouri would meet increases in electricity demand for years to come. But if we had to build the equivalent of its 800MW of capacity, the bill could be $4.5b, judging by the $466m Mighty River Power is spending on its 82MW Ngatamariki geothermal project due for completion next year. So, it's time for Rio and Meridian, Southland and New Zealand to face up to the harsh reality of Tiwai Pt. The plant is no longer economically viable and, at a mere 0.8 per cent of world aluminium output, it is irrelevant to the global industry. Subsidising it further would be a very serious economic mistake.
However, sudden closure of the smelter would only increase the cost and pain of transition to new economic activity for all parties. Logically, three big things need to happen over the next five years: Meridian and Rio must agree an electricity pricing formula that would enable an orderly phase- out of the smelter; generators and the Government must work on helping the electricity market absorb Manapouri's capacity; and Southland and the Government must co-operate on the region's economic development.

Vedanta to restart Odisha refinery from Monday

Business Standard - October 20th, 2012,

A week after going for a temporary shutdown of its alumina refinery at Lanjigarh (Odisha), Vedanta Aluminium Ltd (VAL) is gearing up to restart the plant from Monday, buoyed by bauxite supplies to the tune of around 40,000 tonne from Bharat Aluminum Company's (Balco) Kawardah mines in Chhattisgarh.
As bauxite availability dried up, VAL was forced to shut down the refinery last Saturday.
"Nearly 40,000 tonne of bauxite have reached our refinery premises. We have sourced the raw material from Balco's Kawardah mines. The bauxite stock will be enough to run our plant for 5-6 days if we operate it at 60-70% capacity, which represents the minimum threshold value of the plant”, a company source told Business Standard.
Balco has two captive bauxite mines in Chhattisgarh- Kawardah and Mainpat, with a combined production capacity of 1.9 million tonne per annum. The Mainpat mine is currently closed.
VAL needed 10,000 tonne of bauxite every day to run the plant at full capacity.
VAL will first start its captive co-generating plant (CPP) to generate steam, necessary for running the refinery. It may be noted that along with shut down of the refinery, VAL had also closed its CPP last Saturday as there was no consumption of steam.
Meanwhile, VAL is eyeing bauxite supplies from Gujarat Mineral Development Corporation (GMDC) after bagging the contract from the state PSU.
"The first bauxite shipment has been loaded by GMDC. We hope to get it within a few days. In all, we will get 90,000 tonne of bauxite from GMDC”, said the source.
The company is also in talks with private firms of Gujarat and Maharashtra that are currently engaged in bauxite exports.
VAL had approached both Federation of Indian Mineral Industries (Fimi) and Federation of Indian Chambers of Commerce & Industry (Ficci), seeking ban on bauxite exports. While VAL was struggling to keep its refinery operations afloat for want of bauxite, the raw material continued to be exported by private miners in Gujarat and Maharashtra due to better price realisations.
VAL has not been alloted any mining lease in Odisha and fully depends on externally sourced bauxite to run its refinery. It had entered into a pact with state controlled miner Odisha Mining Corporation (OMC) for supply of bauxite from Niyamgiri hills.
However, attempts to mine bauxite at the ecologically sensitive hills were red flagged by the Union environment ministry that had scrapped the Stage-II forest clearance on August 24, 2010.
Around 6,500 people, including 550 employed directly, 5,000 engaged indirectly and 1,000 self-employed in and around the plant depended on VAL refinery for their livelihood. The company claimed to have spent Rs 150 crore on the development of the local area and community.

Power price fall in smelter closure - October 19th, 2012,

If the energy-hungry Tiwai Point aluminium smelter was closed, the surplus power would be redirected to the rest of the grid, meaning lower prices for consumers, Transpower says.
Transpower chief executive Patrick Strange said at the state-owned enterprise's annual meeting yesterday that the company had no view on, or knowledge of, whether Tiwai Point's aluminium smelter would remain open, but it would be able to move quickly to get that surplus power redirected to the rest of New Zealand's grid "without spill" if it did happen.
The Tiwai smelter uses about 15 per cent of New Zealand's electricity; it is supplied by state-owned Meridian Energy's Manapouri generator. The generator's 824 megawatts would be transported through existing lines - which would need duplexing - to Lake Benmore where it would be transported north by the direct current network.
The two-year duplexing project would cost about $100 million and was already consented, originally for the Project Hayes windfarm in Central Otago which was withdrawn in January.
Transpower was prepared for the smelter to remain or close, Strange said.
A closure would cause prices to fall as excess power flooded the market, he said.
Just like growing potatoes, electricity was a market and subject to supply and demand.
"If Tiwai were ever to close we would have a surplus of generation and the price would decline."
The glut would last for a few years before generation would reduce to rebalance the market, he said.
Meanwhile, with Tiwai remaining open, prices were set to rise because of increased investment in the network, after several years of low investment leading to lower electricity prices in recent years, chairman Mark Verbiest said.
"We're very conscious that increasing electricity costs is a major issue for consumers and businesses and we have a commitment to keep prices as low as possible."
Also at the meeting, Transpower has reaffirmed its ownership of the South Island national grid after the Campaign Against Foreign Control of Aotearoa (Cafca) queried a reference to a controversial 2003 tax-avoidance agreement with an American investment bank in the state-owned electricity monopoly's latest financial report.
Strange said Cafca representative Colleen Hughes' question was a good one.

Rio Tinto Limited : Third quarter 2012 operations review

4-traders - October 16th, 2012,

Bauxite and alumina production were 13 per cent and 20 per cent higher than the third quarter of 2011, driven by increased third party demand for bauxite, expanded refining capacity at Yarwun and record production at Gove.
First bauxite was processed at Yarwun 2 on 5 July 2012, and the Yarwun refinery was operating at 90% of its nameplate capacity of 3.4 million tonnes per annum in September.
Aluminium production was ten per cent lower than the corresponding quarter in 2011, as ramp up to normal capacity continued following resolution of the Alma labour dispute.

UAE primary aluminium industry promoted in Germany

Albawaba Business - October 15th, 2012,

Market awareness of the UAE’s growing primary aluminium sector in Europe has received another boost, thanks to the participation by Dubai Aluminium, DUBAL, and Emirates Aluminium, EMAL, at the 9th World Trade Fair and Conference, ALUMINIUM 2012, which took place in Messe Düsseldorf, Germany, mid-October this year. Held biennially, ALUMINIUM 2012 was the third consecutive time that DUBAL and EMAL exhibited jointly at this forum (the first occasion being ALUMINIUM 2008). As before, the objective was two-fold: to promote the companies’ combined product portfolio to delegates, participants and other visitors to the exhibition; and to raise awareness of the UAE’s primary aluminium industry.
According to Mohammed Al Mutawa, DUBAL’s General Manager Marketing & Sales: Europe & The Americas and EMAL’s General Manager Marketing & Sales, both objectives were fulfilled. “The combined DUBAL-EMAL exhibition stand at ALUMINIUM 2012 featured the extensive range of world-class aluminium products produced in the UAE and shipped across the globe; the two smelters’ adherence to the highest standards in environmental protection; and their foundation on sustainability principles. Already well-known in the European Union, DUBAL and EMAL’s foundry products are used extensively by the region’s automotive industry, comprising all the major carmakers, to manufacture wheels, engine components, plus the shiny rims and trims on high-end automobiles; as well as by the region’s aerospace industry to manufacture aeroplane sheet and plates,” says Al Mutawa. “By again displaying our combined product offering, we are confident of increased sales volumes in these and other sectors.”
Al Mutawa adds that the DUBAL Marketing & Sales department is responsible for marketing the metal produced by both companies. “DUBAL has been an active player in the European market since 1996, shipping substantial product volumes each year to Germany, the Netherlands, Italy, Czech Republic, Poland, France and Greece. The company has enjoyed good market share growth over the years, and this trend is set to continue,” he says. “For 2012, we expect that over 27 per cent of the 1,795,000 metric tonnes joint cast production of DUBAL and EMAL will be shipped to Europe, with the major proportion of this volume comprising billet and foundry re-melt products. Further ahead, the fact that the European Union as a whole needs to import approximately 60 per cent of its primary aluminium requirements offers excellent prospects for future market share growth for both DUBAL and EMAL.”

Alba's Q3 production, sales steady

Reuters - October 14th, 2012,

Aluminium Bahrain , the world's fourth-largest aluminum smelter, said production and sales were steady in the third quarter and it expects full-year output to exceed the 2011 level.
Production was 219,681 tonnes compared with 222,553 tonnes in the same period a year ago. Sales were 218,507 tonnes compared with 220,608 tonnes, Alba said on Sunday.
"For the year, Alba is projecting to exceed the record production it has achieved in 2011," chief executive Tim Murray said in a statement.
The company's production increased by 4,405 tonnes in the first nine months of the year to 663,214 tonnes compared with the same period of 2011, while sales stood at 664,552 tonnes.
Last week Alcoa Inc said it would pay Alba $85 million in cash and enter long-term raw material supply contracts to settle the Bahraini firm's racketeering and fraud lawsuit against it.

Refinery closure to hit Vedanta's aluminium smelter

Business Standard - October 14th, 2012,

A day after shutting down its bauxite refining unit at Lanjigarh temporarily citing unavailability of bauxite ore, Vedanta Aluminium Limited (VAL), has said it can hardly run its smelter facility at Jharsuguda for a month in the absence of enough alumina to run the plant.
“Amid raw material supply problems, we can run the smelter plant hardly by a month or so,” said an official of VAL smelter plant.
The company has invested in two greenfield aluminium smelting plants at Jharsuguda. While the first smelter with a capacity of 0.5 million tonne per annum (mtpa) capacity is producing aluminium using alumina processed at Lanjigarh, the work on the second smelter with 1.1 mtpa capacity is currently on.
With the Lanjigarh refinery now shut down, the fate of the aluminium smelter at Jharsuguda is also doomed, sources said.
Earlier, VAL had decided to participate in the alumina export tender of its competitor National Aluminium Company (Nalco) to buy alumina for its smelter. But this has been vehemently opposed by the empluees unions of Nalco.
Yesterday, VAL had started the process of shutting down the Lanjigarh alumina refinery after it had become increasingly difficult to keep its operation afloat amid bauxite stock dwindling to zero level. Though the company, through an advance notice, had sounded the state government last month to close the refinery on December 5, it pre-poned the closure process.
“Unless and until we have bauxite stock for at least 10-15 days, we have to keep the refinery plant closed,” Mukesh Kumar, Chief Operating Officer and President, VAL.
The company has already intimated the Kalahandi east electrical division of Western Electricity Supply Company (Wesco) regarding its intention to close its captive generation plant. The company will source 8-10 MW power from the state grid for idle running of systems of the plant and township.
“We are trying our level best to source bauxite and have already sent a team to Gujarat for sourcing of the raw material,” Kumar said.
Vedanta had won the contract for sourcing 90,000 tonnes of bauxite, but the supply of which are likely to commence only after 10-15 days.
The company is also waiting for the withdrawal of Ministry of Environment and Forest circular for environmental clearance required at the time of renewal of mining lease which has been nullified by the Delhi High Court for sourcing of bauxite from Jharkhand and Chhatisgarh.
The aluminum major has been running its one million tonne per annum refinery at 25-30 per cent capacity for last 8- 10 days. To run the refinery plant at full steam, VAL needs 300,000 tonnes of bauxite every month.
The closure of the refinery is set to put at stake livelihood of 6,500 people, including 550 employed directly, 5,000 engaged indirectly and 1,000 self-employed in and around the plant. The company claimed to have spent Rs 150 crore on the development of the local area and community.
VAL has not been allotted any mining lease in Odisha and fully depends on externally sourced bauxite to run its refinery. It had entered into a pact with state controlled miner Odisha Mining Corporation (OMC) for supply of bauxite from Niyamgiri hills. However, this was red flagged by the Union environment ministry which scrapped the Stage-II forest clearance of the mining project on August 24, 2010.
Following Niyamgiri debacle, VAL had filed 26 applications with the state government, seeking alternative bauxite deposits. But the state government is yet to take any action on them.

Vedanta may close refinery in three days

The Pioneer - October 12th, 2012,

The Vedanta Aluminium Ltd would close its refinery at Lanjigarh temporarily within three days as it does not have any stock of bauxite to run the plant. Within last eight days, the production rate has gone down to 30 per cent 35 per cent, sources said.
The company on Wednesday, in a letter to the authorities of the Wesco, requested supply of 8-10 MW of electricity to the refinery as its captive power plant would be closed temporarily for a few days on the sidelines of the closing of the refinery due to shortage of bauxite. To continue alumina production, the refinery needs 10,000 tonnes of bauxite. The company served a notice to the State’s Labour Department about the problem on September 6 and informed that it would shut down the plant temporarily from December 5.
The company would bring 90,000 tonne bauxite from the Gujarat Mineral Development Corporation to run the plant, but that would probably reach here in the plant in October last week; so they would close the plant for some days till the bauxite is received, company sources said.

UPDATE 1-RUSAL eyes Siberia smelter with Chinese partner

Reuters - October 12th, 2012,

Russian aluminium group RUSAL is looking for Chinese partners to build a smelter in Siberia with a design capacity of 800,000 tonnes per year.
"We understand that despite the challenging economic situation globally, now is the time to lay the foundation for development of Siberia and the far east, as these regions will be driving Russia's growth in the years ahead," first deputy chief executive Vladislav Soloviev said on Friday.
His comment was made after RUSAL signed an agreement with the economy ministry to "work closely within the framework of a potential joint venture with the Chinese partners to build an aluminium smelter in Siberia".
Hong Kong-listed RUSAL had said in September companies in China, the world's largest consumer and producer of aluminium, should consider investing in new smelting projects in Siberia.
China, which accounts for 44 percent of global aluminium consumption, needs to invest in production projects to meet increasing demand over the next 5-10 years, according to RUSAL.
"We have constantly confirmed that China is a priority market for RUSAL's development. The signing of the agreement with the Russian Ministry of Economic Development aims to reinforce our joint efforts to increase the presence of Russia in the region," Soloviev said.

Aluminium demand to grow by 6 per cent in 2012-14: IMaCS

The Economic Times - October 12th, 2012,

AHMEDABAD - With the expectation of moderation in growth in India's industrial production and real gross domestic product (GDP), demand for aluminium is likely to increase at an annual average growth rate of 6% during 2012-2014, says ICRA Management Consulting Services Ltd (IMaCS), a subsidiary of Investment Information Credit Rating Agency Ltd (ICRA) an independent and professional investment information and credit rating agency.
According to IMaCS in the medium term the sectors that are likely to drive the expected increase in demand of aluminium will be power, construction and automotives. India's aluminium consumption increased 7% in 2011 to around 1.6 tonne, and at a 5-year CAGR of 8%.
The bulk of India's demand is accounted for by the electrical sector (39%), followed by transport (18%), machinery (15%), and packaging (9%). By comparison, globally, the use of aluminium by major sectors stands at transport equipment (29%), building/construction (18%), packaging (18%), electrical (9%), and machinery (8%).
India's primary aluminum production capacity is expected to increase from 1.7 tonnes per annum (tpa) at present to 4.7 tpa by end-2017, with much of the forecast expansion in capacity and production targeted for export markets. Aluminium production capacity is forecast to increase by 8.7 tpa to 13.3 tpa, with around 4 tpa of capacity surplus to domestic requirements, the IMaCS report said.
IMaCS report says that although India's annual per capita aluminium consumption has increased from 0.6 kg in 1996 to 1.3 kg in 2011, it is around 10% of China's per capita consumption of 13 kg. India's per capita consumption is unlikely to increase at the same rate as China because of lower share of industrial sector in India's GDP, and lower proportion of manufactured products in India's merchandise exports.
World primary aluminium consumption aggregated 42.4 tonnes in 2011, making aluminium the world's second most used metal, after iron. Over 2007 to 2011, world aluminium consumption grew by an estimated compounded average growth rate (CAGR) of 4.6%, the IMaCS report noted. Aluminium's main markets are China, which represented 41.4% of worldwide demand in 2011, followed by US (9.6%), Germany (5%), Japan (4.6%), and India (3.7%).
IMaCS report on the price trends says that during 2011, although world aluminium prices increased 10.5% to average $2,401 a tonne, prices declined from June 2011 reflecting weaker consumption growth in most major consuming economies. During January-September 2012, prices declined 19% to $2,030 per tonne. Prices rallied in early-2012 because of recovering market confidence and better-than-expected global growth.
However, with renewed setbacks to global recovery, prices fell below $2,000 a tonne during June-August 2012. Prices rebounded somewhat in September 2012 in anticipation of a pickup in economic activity beginning in the fourth quarter of 2012 and the impact of possible stimulus measures in China. Prices continue to be depressed by the market surplus and have remained susceptible to fluctuations in the global economic cycle.
In 2012, world aluminium prices are forecast to decline 15% to average around $2,050 a tonne. World consumption is forecast to grow at a lower rate than production, and stocks relative to consumption could rise from an estimated 8.6 weeks at end of 2011 to 11.7 weeks at the end of 2012. On the upside, prices could be supported by higher energy and raw material costs. Domestic prices would continue to remain linked with world prices, and price changes could be determined by exchange rate fluctuations, the IMaCS report said.

Rio Tinto Alcan seeks bids for French aluminium plant

Mineweb - October 11th, 2012,

PARIS - Rio Tinto is pushing ahead with plans to sell a century-old aluminium plant in the Alps of southeast France as the global mining group continues its retreat from a struggling aluminium sector.
The group's Rio Tinto Alcan division that operates the Saint-Jean-de-Maurienne plant told Reuters the upcoming renewal of a 30-year-old electricity supply contract with EDF swung the balance in favour of selling a site that was among its less profitable.
The plant, which went into production in 1907 in the early years of the aluminium industry, had 431 workers at the end of last year, making it in the leading employer in the local area.
"We're focusing our efforts on the sale process, which is progressing well," a spokeswoman for Rio Tinto Alcan said on Wednesday. "We have received expressions of interest."
The group expects to end "in a week or two" a first stage of preliminary offers before entering talks with interested parties about possible firm bids for the site, she said.
A sale could avoid the plant becoming the latest in a series of industrial sites in France to announce closures or mass layoffs, a blow to Socialist President Francois Hollande as he tries to alay fears over surging unemployment.
Rio Tinto already sold three plants in France this year that produce alumina, an ingredient in aluminium also used separately as an abrasive, as part of an estimated $8 billion of aluminium assets put up for sale last year.
It also said earlier this year it was considering a sale of the Saint-Jean-de-Maurienne plant. Rio Tinto wants to focus on its more profitable iron ore activities and its retreat from aluminium has been encouraged by sluggish prices and a weak European market hit by overcapacity.
Rio Tinto Alcan is continuing talks with EDF about a new electricity deal that would let it continue operating the plant, but the sale of the site "is the priority", the spokeswoman said.
But the head of EDF said the aluminium maker had no willingness to reach a deal and had already decided to sell. "The fate (of the site) has already been sealed, the matter is closed. Rio Tinto has already decided to stop," EDF's Chief Executive Henri Proglio said on Wednesday during a debate on energy organised by French parliamentarians. His comments supported those of a source at Rio Tinto.
"We are planning to sell it in 2013 and it is on top of our divestment pile," the source said. "We don't see value in that smelter, it is not part of our strategy so we had been planning to shut it down or sell it for a while." The Rio Tinto spokeswoman said no decision had been taken yet whether to go ahead or not with a sale, and that a closure would only be envisaged if the sale process failed.
The French government has been acting as a facilitator in the talks between Rio Tinto Alcan and EDF, and the industry ministry is to host a delegation of union and public officials next Tuesday. The ministry declined to comment on the situation.
Saint-Jean-de-Maurienne is the smaller of Rio Tinto Alcan's two primary aluminium plants in France, with its capacity of 135,000 tonnes only half that at Dunkirk on the north coast.
Rio Tinto Alcan is the descendant of former French aluminium maker Pechiney bought a decade ago by Canada's Alcan which was later absorbed by Rio Tinto.

Vedanta may shut down Lanjigarh refinery temporarily from Friday

Business Standard - October 10th, 2012,

Vedanta Aluminium Ltd (VAL), which had announced to close down its alumina refinery in Odisha from December 5 for want of bauxite, may go for a temporary shutdown of the facility in a day or two, much before the due date.
With no immediate supply of bauxite in sight, the company said, it will be compelled to shut the refinery for 10-15 days, latest by Friday.
"Going by our current stock of bauxite, we will not be in a position to run the refinery after a day or two. Then, we have to take a painful decision to shut our refinery plant for 10-15 days. Already, the refinery's capacity utilization has slumped to 30-35 per cent for the past 8-9 days and it is not advisable to run the plant at this depleted capacity for technical reasons”, a top company executive told Business Standard.
VAL's only glimmer of hope- sourcing bauxite from state run Gujarat Mineral Development Corporation (GMDC) is unlikely to come to its immediate rescue as this deal is expected to take some time to materialize.
"We had bid for GMDC's tender and have also won the contract for sourcing 90,000 tonnes of bauxite. But supplies are likely to commence only after 10-15 days. Till then, we have to keep the refinery shut”, added the official.
With its refinery plant heading for closure, VAL has decided to close its captive co-generation power plant as there would not be any generation of steam to run it. VAL has already intimated the Kalahandi east electrical division of Western Electricity Supply Company (Wesco) regarding its intention to close its captive generation plant. It has sought 8-10 MW power from the state grid to ensure safe idle running of the systems of power plant and refinery.
The closure of the refinery is set to put at stake livelihood of 6,500 people, including 550 employed directly, 5,000 engaged indirectly and 1,000 self-employed in and around the plant. The company claimed to have spent Rs 150 crore on the development of the local area and community.
VAL has not been allotted any mining lease in Odisha and fully depends on externally sourced bauxite to run its refinery. It had entered into a pact with state controlled miner Odisha Mining Corporation (OMC) for supply of bauxite from Niyamgiri hills. However, attempts to mine bauxite at the ecologically sensitive hills were red flagged by the Union environment ministry that had scrapped the Stage-II forest clearance on August 24, 2010.
Following Niyamgiri debacle, VAL had filed 26 applications with the state government, seeking alternative bauxite deposits. But the state government is yet to take any action on them.
“There is no readily available bauxite that we can offer to Vedanta Aluminium. There is no dearth of bauxite deposits in the state. But the mines have to be opened and these need regulatory approvals. Moreover, the Niyamgiri case is still locked up in the Supreme Court and there is nothing the state government can do about it", state chief secretary B K Patnaik had said recently.

Alcoa cuts forecast for aluminium demand

Basic Resources - October 10th, 2012,

Alcoa, the US aluminium group, has cut its forecast for global demand growth because of the slowdown in China, as it reported third-quarter results that were slightly better than expected. The company cut its prediction of global aluminium market demand growth in 2012 from 7 per cent to 6 per cent, which would be the slowest increase since the recession of 2008-09.
Demand for aluminium, often seen as a barometer of the world economy because of its widespread use from airliners to drinks cans, grew by 13 per cent in 2010 and 10 per cent in 2011.
Klaus Kleinfeld, Alcoa’s chief executive, told analysts on a call he was “pretty confident” that the stimulus measures announced in China meant “demand will be picking up speed”. However, he said it was “probably going to take until the end of the fourth quarter” to show results. Opening the US corporate reporting season, Alcoa said earnings per share were 3 cents in the third quarter, excluding one-off costs, compared with an average forecast from analysts that it would break even.
However, including those one-off costs of $175m, mostly for clean-up at sites in the US, Canada and Norway but also including a charge for a settlement with Aluminium Bahrain over alleged corruption, there was a loss of 13 cents per share.
“Markets seem to be driven more by headlines than fundamentals right now, but Alcoa remains focused on the things within our control,” Mr Kleinfeld said. “We’re capitalising on pockets of strong growth and achieving record profitability in our mid and downstream businesses.” Alcoa said demand in Europe?was?shrinking, while growth in China, India and the rest of Asia was slower than it had been in the first half. However, North America and Russia were still growing steadily, while Brazil was picking up. In spite of the slowdown this year, the company is sticking with its prediction aluminium demand will grow by an average of 6.5 per cent a year to 2020.
Alcoa’s businesses making primary aluminium and alumina, the intermediate product used to make the metal, both lost money, but were offset by profits from the divisions making rolled products such as aluminium sheets and plates, and more sophisticated engineered products such as forgings, fasteners and wheels.

Tajik aluminium output eases in Jan-Sept

Business Recorder - October 9th, 2012,

DUSHANBE - Tajikistan's state-owned aluminium smelter, the largest in Central Asia, raised production by 0.2 percent year-on-year in the first nine months of 2012, a source close to the management said on Tuesday.
Tajikistan Aluminium Company, or TALCO, produced 210,672 tonnes in the January-September period, said the source, who declined to be named because the production data is not public.
TALCO has been ramping up production this year after a modernisation programme completed at the end of 2011, which has resulted in lower year-on-year output figures for most of 2012.
A 15-day stoppage of Uzbek gas supplies also hit output in April.
The company last month cut its 2012 output forecast by 15 percent. It now expects to produce 281,000 tonnes of aluminium this year, down from a previous forecast of 332,500 tonnes but slightly more than the 277,584 tonnes produced in 2011.
The smelter's production is crucial to the economy of Tajikistan, the poorest of 15 former Soviet republics. Aluminium accounts for slightly less than half of Tajikistan's entire export revenues.

UAE Primary Aluminium Industry On Show In Germany Joint participation of DUBAL and EMAL at ALUMINIUM 2012 will promote product sales in Europe and raise profile of UAE aluminium sector.

Middle East Events - October 7th, 2012,

In support of the region’s strategic ambitions to grow product sales in Europe, the UAE’s primary aluminium industry will be well represented at the 9th World Trade Fair & Conference (“ALUMINIUM 2012”), which takes place at Messe Düsseldorf, Germany, from 9 to 11 October this year. This will be achieved through the joint participation of Dubai Aluminium (“DUBAL”) and Emirates Aluminium (“EMAL”) at ALUMINIUM 2012 – an event which the organisers say unites producers, processors, technology suppliers and consumers along the entire aluminium value chain. This makes ALUMINIUM 2012 a world-leading business-to-business platform for the aluminium industry and its main applications, and thus an excellent forum for increasing the volumes of DUBAL and EMAL’s products sold in Europe and farther afield.
With this in mind, the combined DUBAL-EMAL exhibition stand at ALUMINIUM 2012 will promote the two companies’ key attributes, specifically the extensive range of made-to-order, world-class, premium quality primary aluminium products of the highest purity being produced in the UAE and shipped across the globe; the smelters’ adherence to the highest standards in environmental protection; and their foundation on sustainability principles. Already well known in the region, DUBAL and EMAL’s foundry products are used extensively by the European Union’s automotive industry – comprising all the major carmakers – to manufacture wheels, engine components, plus the shiny rims and trims on high-end automobiles. The two companies’ products are also widely used to manufacture aeroplane sheet and plates for the European Union’s aerospace industry.
An entirely state-owned enterprise, DUBAL owns and operates a one million metric tonne per annum primary aluminium smelter at Jebel Ali, Dubai — one of the largest single-site operations of its kind in the world. The company is renowned internationally for its premium purity, high quality products and services; as well as its commitment to sustainable development through conscious efforts to maximise the health and safety people, reduce the impact of its operations on the environment, and invest in the social and economic development of the community. Dedicated programmes support the Emiratization goals of the UAE, including targeted recruitment, skills development, management training and strategic career planning. Approximately 92 per cent of DUBAL’s annual production is exported globally, the company’s key markets being Asia, Europe, the Middle East North Africa (“MENA”) region and the Americas.
Aiming for continuous improvement through innovation, DUBAL has invested substantially in developing advanced reduction cell technologies that not only improve productivity but also reduce the operations’ impact on the environment through improved energy efficiency and minimized emission levels. This has culminated in proprietary DUBAL DX and DX+ Technologies — both of which operate at high amperage levels and rank among the best reduction technologies available.
EMAL, a 50:50 joint venture between DUBAL and Mubadala, was established in February 2007 to construct the world’s largest single-site aluminium smelter complex. The project is being built in two Phases. Commissioning of EMAL Phase I, with a total capacity of 750,000 metric tonnes per annum, took place between 1 December 2009 and 31 December 2010. The company already enjoys a strong reputation for sound safety management, wellbeing programmes for its employees and adopting global best practices to minimize its environmental footprint — the latter entrenched through the implementation of DUBAL DX Reduction Technology, which offers enhanced energy efficiency and productivity levels yet lower environmental emissions than comparative technologies. These attributes are complemented by initiatives to harness Emirati talent through job-creation, engaging the community in corporate activities and celebrating the national and cultural heritage of the UAE.
EMAL Phase II was announced in July 2011. A new 444-cell potline is being built which, together with a technology upgrade of the existing cells, will increase EMAL’s annual production capacity to around 1.3 million metric tonnes by the end of 2014. The new generation, enhanced DUBAL DX+ Technology has been licensed for EMAL Phase II.
The DUBAL Marketing & Sales department is responsible for marketing the metal produced by EMAL. This amounted to 288,568 metric tonnes of cast aluminium in 2010, and 748,000 metric tonnes in 2011; in addition to DUBAL’s own sales, which exceeded one million tonnes in both years. “In 2012, we expect that over 27 per cent of the 1,795,000 metric tonnes joint cast production of DUBAL and EMAL will be shipped to Europe,” says Mohammed Al Mutawa (DUBAL’s General Manager Marketing & Sales: Europe & The Americas and EMAL’s General Manager Marketing & Sales). “As in prior years, the major proportion of this volume will comprise billet and foundry re-melt products.”
Al Mutawa adds that DUBAL has been an active player in the European market since 1996, shipping substantial product volumes each year to Germany, the Netherlands, Italy, Czech Republic, Poland, France and Greece. The company has enjoyed good market share growth over the years, and this trend is set to continue. “Given that the European Union as a whole needs to import approximately 60 per cent of its primary aluminium requirements, we foresee excellent opportunities to grow the market share of DUBAL and EMAL in the region,” he says. “This, together with the stringent standards to which we adhere so as to minimize our operations impact on the environment and ensure longer-term sustainability, creates confidence that demand for our products will continue to increase.”

Nation's first alumina plant operation delayed

tuoitrenews - October 6th, 2012,

The US$460-million Tan Rai alumina plant in Lam Dong Province will be put into operation on November 1 instead of this month as previously announced, the Tan Rai bauxite project management board has said.
The delay, because of unsatisfactory preparation, was announced at yesterday’s meeting between the board, the Vietnam Coal and Mineral Group (Vinacomin), and Deputy Minister of Industry and Trade Le Duong Quang.
At the meeting, Phan Boi Loi, director of the board, said that nearly all the work items of the plant have been completed, but a number of them have yet to meet requirements in terms of technique and stability.
For example, the thermal power house has failed to run at a capacity of 30 MW, while some other times have yet to operate stably, Loi said.
When discussing about the plant’s safety, the deputy minister urged Vinacomin to prepare a plan to timely cope with any incidents that might occur to the plant’s red mud reservoir.
As previously reported, Tran Duong Le, the board’s deputy director, said in a September meeting that the plant has almost been completed and the facility would be put into operation in October 2012.
The contractor of the plant is China Aluminum International Engineering Co. (Chalieco), a subsidiary of state-owned Aluminum Corp of China, or Chinalco.
Vinacomin, which owns the plant, has forecast Tan Rai's alumina output at 300,000 tons this year, increasing to 500,000 tons in 2013 and 650,000 tons in 2014.
Alumina is a white granular material, a little finer than table salt, and is properly called aluminum oxide, which is used to produce aluminum.
Vinacomin and China's Yunnan Metallurgical Group have entered into a memorandum of understanding, under which the former has agreed to sell 600,000-900,000 tons of alumina a year to the latter to feed its smelter, Yunnan Aluminum Industry Co. Ltd.

China's bauxite concerns prevail despite Indonesian deliveries

Platts - October 4th, 2012,

China's bauxite supply concerns prevail despite a pickup in shipments from Indonesia recently, importing refiners said Tuesday, citing lower than expected volumes in the cargoes received.
"Our cargo just arrived this month, and it's a lot less than expected, by more than 60%," a source from Shandong refiner Nanshan Donghai said. The company previously received monthly shipments of around 200,000 mt.
Another Shandong refiner, Lubei Enterprise, who received a shipment from Indonesia in early September, said he also saw a lower quantity delivered, but declined to provide further details.
A third Shandong refiner, Chiping Xinfa, said they had yet to receive a shipment from Indonesia, but were expecting the cargo to arrive in October. “We have also been told the amount will be less than normal, but we can’t be sure by how much until we see the cargo,” a source said.
Chinese importing refiners attributed the lower quantity to export quota issues in Indonesia, which limited the amount suppliers could deliver.
The refiners said deliveries from Indonesia were expected to continue regularly in the coming months, but there was no assurance on the quantity, so whether there can be sufficient supply remained a major concern.
In a bid to ensure regular supply of bauxite from Indonesia, some Chinese refiners such as Aluminium Corp of China (Chalco) and Chongqing Bosai Minerals Group have agreed to investment projects in the Southeast Asian country.
Chalco said in August it will set up a joint venture with PT Indonusa Dwitama to build a bauxite mine and alumina refinery in Indonesia, while Chongqing Bosai Minerals Group planned to invest $1 billion in Indonesia to build a 2 million mt/year alumina plant.
The decision to invest in Indonesia has helped Chalco and Bosai bypass Indonesia's new export policies this year, which had resulted in delays of bauxite shipments to China since May.
The two companies were the earliest to see bauxite shipments from Indonesia resume in July and August, while most others started receiving shipments in September.
"That's the criteria set by Indonesia, so we need to invest to ensure a steady supply of bauxite," a Bosai source said, adding that they saw two cargoes arrive in August and had no issues with the quantity.
Other importing refiners, meanwhile, have been looking for alternative suppliers, such as buying more from Australia and India, or investing in other countries with bauxite resources.
Shandong refiner, Chiping Xinfa, invested in a Fiji bauxite mine in 2011 and has started receiving supply from there since July this year. Others said they were now trying to buy more from Australia and India. But supply concerns also prevail in India recently with talks that the country may move to control bauxite exports similar to that seen from Indonesia.
Market talk is that India may have to cut bauxite exports to support a domestic industry suffering from bauxite shortages.
Indian alumina producer Vedanta said it planned to shut down its 1 million mt/year alumina refinery in the state of Orissa on December 5 due to a lack of bauxite feed.
Chinese importing sources have also noted "difficulties" in getting Indian bauxite supply recently.
"There's definitely been some pressure from India recently, a lot of talk that they are limiting exports, and it seems to be getting more difficult to get stocks from there now," the Nanshan Donghai source said.
"We heard that even those Chinese companies with joint-venture ties in India are having a tough time, facing low bauxite output and reduced export quantity," a Chinese trader said.
In India, an industry source said Vedanta's plan to shut down its refinery "is a move to pressure the government to limit bauxite exports ... we don't think they will really shut down in the end."

Three potential suitors for Alcoa Italy plant -junior min

Reuters - October 4th, 2012,

Three companies have expressed interest in the Italian smelter of U.S. aluminium group Alcoa , an Italian junior minister said on Thursday as the Italian government looks around for a buyer for the troubled plant.
"At the moment there are three manifestations of interest from (Switzerland's) Klesch, (Italy's) Kite Gen and an Australian company," Industry junior minister Claudio De Vincenti said on the sidelines of a conference.
Alcoa has decided to shut its aluminium smelter in Sardinia, blaming high power prices for undermining its competitiveness.
Swiss commodities trader Glencore recently suspended talks over a possible offer for Alcoa after Italy rejected its request for sharply discounted power prices.

Cape Alumina renews plans for bauxite mining in Steve Irwin Wildlife Reserve on Cape York - October 3rd, 2012,

A PLAN to develop a bauxite mine on a stretch of land within the Steve Irwin Wildlife Reserve on Cape York has won significant project status from the State Government, paving the way for 1700 jobs and $1.2 billion for the economy.
The latest planned development of the Pisolite Hill bauxite mine, owned by Cape Alumina, was stalled in 2010 when the Bligh government declared the nearby Wenlock River a wild river and imposed a 500m buffer zone around waterways.
But the Newman Government has said it will scrap the Wild Rivers laws and impose its own statutory planning regime on the Cape.
Pisolite Hills is one of several significant development prospects for the Cape with Oresome Minerals, a subsidiary of Metallica Minerals, holding four mining leases and applications for a further 10 exploration permits for sand mining.
Rio Tinto also has State Government approval for the South of Embley bauxite project, near Weipa, but is still waiting for the federal go-ahead.
Cape Alumina managing director Graeme Sherlock said the Newman Government had made it clear the future of project would be determined through a genuine and rigorous environmental assessment process rather than through a political process.
"It simply requires Queensland's laws to be applied fairly and with due recognition of expert advice," Mr Sherlock said.
"That's what is happening now. That's all Cape Alumina has ever asked for.
"The Queensland Government has provided certainty and a stable investment environment and in return Cape Alumina will provide world's-best practice in all of its operations on Cape York."
But the Wilderness Society said the mine could never go ahead without endangering one of the last pristine wild rivers in the world.
"We don't think you can have a balance here," Wilderness Society's Tim Seelig said.
"The Wenlock River has the greatest freshwater diversity of any river in Australia, and is the lifeblood of the surrounding landscapes."
The significant project status does not guarantee development but provides a streamlined system of approval for major projects.
Cape Alumina has also said it does not yet have finance for the project which will also need the approval of the Federal Government.
Mr Sherlock said the Pisolite Hills project would boost skills, employment and business development opportunities among local Aboriginal communities and help people in the area to escape the welfare cycle.
The mine will encroach on about 10 per cent of the Steve Irwin Wildlife Reserve.
Cape Alumina has more than 4000 drill holes for Pisolite Hills which has a resource estimated at 134.6 million tonnes of in-situ bauxite.
This resource has the potential to yield up to seven million tonnes per annum of dry-product bauxite over a 15-year period.

Bauxite Jobs Saved

The gleaner - October 3rd, 2012,

A CLOUD of uncertainty which was hanging over the 600 jobs at the Ewarton bauxite plant in St Catherine was lifted yesterday with the announcement that the Russian-based aluminium producer, UC Rusal, will be investing US$100 million (J$9 billion) in the facility.
The investment will fund the establishment of a coal-fired electricity generating plant at Ewarton with construction set to begin next year and earmarked for completion in 2015.
Minister of Science, Technology, Energy and Mining Phillip Paulwell yesterday announced that the Government has signed a concessionary agreement to waive the bauxite levy on the operations at the company's Ewarton plant for a year.
The concession takes effect from October 1, 2012 to September 30, 2013.
During the period of the concession, it has been agreed by the Government and UC Rusal that the employment level at the plant will be maintained at the current 600 local jobs.
The terms of the accord also state that over the one-year concession, the company will maintain the level of production at the refinery. At present, the company is operating at 300,000 metric tons per annum, representing half its total capacity.

Alcoa plant gets EU boost on Italy power prices

Reuters - October 3rd, 2012,

The troubled Italian smelter of aluminium group Alcoa (AA.N) will be able to continue using special contracts allowing it to buy electricity at lower prices until 2015 following a decision on Wednesday by the European Commission.
The Commission ruled the so-called interruptibility power contracts on the islands of Sardinia and Sicily did not constitute state aid, giving a green light to the schemes being used by heavy-energy users there for the next three years.
A statement by the Commission did not mention any company.
Alcoa has decided to shut its aluminium smelter in Sardinia, blaming high power prices for undermining its competitiveness.
The Italian government is looking round for a possible buyer of the plant to avoid job losses on an island that already has a 15 percent unemployment rate.
"This is good news for the government though the extension is only for three years and that might deter potential buyers of the Alcoa plant," an industry source said.
Swiss commodities trader Glencore (GLEN.L) recently suspended talks over a possible offer for Alcoa after Italy rejected its request for sharply discounted power prices.
Glencore had asked for a power price at the plant of no more than 25 euros per megawatt hour for 10 years compared to a price of 35 euros/MWh proposed by the government.
Glencore is one of a series of companies eyeing the Alcoa smelter.
Italy has some of the highest electricity prices in Europe with a price of around 70 euros/Mwh and some Italian companies have threatened to relocate to find cheaper energy costs.
The situation is particularly critical on the islands of Sicily and Sardinia because of the less developed power connections compared to the mainland.
"At this point we need to use these 3 years to complete the interconnections with abroad and press ahead with an industrial policy that keeps steel, aluminium, cement, glass, paper and ceramics businesses in Italy," member of parliament and former industry junior minister Stefano Saglia said On Wednesday.
Under interruptibility contracts, big companies accept that their power supplies can be halted by the grid operator if needed to re-balance the electricity network or avoid blackouts.
In return the companies are offered discounts on the price they pay for power.

Orbite Announces Major Achievements And Final Design of Smelter-Grade Alumina (SGA) Plant - October 2nd, 2012,

MONTREAL - Orbite Aluminae Inc. (TSX:ORT / OTCQX:EORBF) (the "Company" or "Orbite") is pleased to announce major technical achievements and the final design phase of the smelter-grade alumina (SGA) plant. With the support of M&K, a North American leader in chemical process design, Orbite successfully modified the SGA plant design by incorporating the best practices from the chemical industry and expanding the breadth of its innovative processes, resulting in a significant reduction in the consumption of fossil fuels by at least 30%, and of water by at least 60%. These advancements should lead to a major reduction in the number of operational units required in various aspects of the SGA plant, and provide the basis for a decrease of the estimated operating and capital costs. The final design of the SGA plant is expected to ensure the consistent production of high-quality smelter-grade alumina, while improving Orbite's position as a low-cost producer and leader for clean technologies for the alumina industry.
"These advancements represent a major achievement for Orbite," said Richard Boudreault, Orbite's President and CEO. "By simplifying and optimizing the SGA plant design, we succeeded in our goal of reducing our dependence on fossil fuels while significantly improving the plant economics. This consolidates our position as one of the lowest-cost and environmentally-friendly producers of alumina and its by-products."
As part of the final design of the SGA plant, Orbite developed and incorporated a new proprietary calcination technique using circulating fluid beds that operate at lower temperatures and enable the heat generated from calcination to be reused in the hydrochloric acid regeneration system, thereby, reducing fossil fuel consumption by at least 30%. The final design also reflects important changes to the acid leaching and acid recovery/regeneration systems. Water consumption has been reduced by 60%, resulting in lower volumes of acid solution. These lower volumes automatically reduce the number of separation/crystallization and acid regeneration units required, as well as the number of units required for the individual extraction of by-products. These design improvements are anticipated to have a considerable impact on the plant economics since alumina calcination represented 55% of fossil fuel costs, which in turn represented 60% of all SGA operating costs. The SGA operating cost savings are estimated to be in the order of 20% relative to the PEA (Orbite's Revised Preliminary Economic Assessment dated May 30, 2012. According to Canadian 43-101 regulations, mineral resources that are not mineral reserves do not have demonstrated economic viability).
The SGA plant Feasibility Study, which has now entered the detailed engineering and sub-system integration phase, will be modified to incorporate the final design of the SGA plant, and is now anticipated to be completed during the first half of 2013. Construction of the first phase of the first SGA plant is still anticipated to begin in 2013 with completion by late 2014.
"Orbite's unique patented technology has reached another milestone", said Denis Primeau, Orbite's Chief Engineer. "The final design of the SGA plant is now set and brings us one step closer to construction. As anticipated, the integration of previously separate subsystems, as part of the optimization process, and the inclusion of innovations from the chemical industry yielded important synergies. The key drivers were substantial reductions in the quantity of water and energy consumption, both critical factors for chemical processes and improves our environmental footprint. By utilizing circulating fluid beds, our proprietary calcination technique will differ completely from the rest of the alumina industry and will enable our plants to meet and exceed the industry standard for smelter grade alumina. Our ability to innovate technologically while improving the economics of our process through the integration of best practices from the chemical industry has been truly remarkable."
"For M&K, it is obvious that the Orbite process, which we are tasked with integrating as part of the Feasibility Study, has not only been demonstrated using commercially available equipment but also represents the first viable alternative to the Bayer process for the production of smelter grade alumina", added Stanley Myer, M&K's co-founder. "The final design of the SGA plant was established by M&K with Orbite's engineering team and we have validated the improvements cited today. Since it was established, M&K has always been involved in major chemical process projects such as that of Orbite's. As such, all of the equipment, products and by-products under consideration by Orbite are within the realm and expertise of our company."
The technical content in this press release has been reviewed and approved by Denis Primeau, Eng., a "qualified person" pursuant to National Instrument 43-101 – Standards of Disclosure of Mineral Projects (NI 43-101). Mr. Primeau is the Chief Engineer of Orbite, and as such, is not independent pursuant to NI 43-101.

Vedanta set to source bauxite from GMDC

Business Standard - October 1st, 2012,

Opening of tender by state owned Gujarat Mineral Development Corporation (GMDC) for sale of 92,174 tonnes of bauxite has injected hope to Vedanta’s alumina refinery at Lanjigarh in Kalahandi district that is staring at possible shutdown on bauxite crunch.
“ We will participate in the bid of GMDC for sale of 92000 tonnes of bauxite by submitting the tender papers on October 4, the last date of participation”, said a top official of Vedanta Aluminium Ltd (VAL), a unit of London-listed Vedanta Resources Plc.
It may be noted, the company is struggling to keep its one million tonne refinery operations afloat with the plant running at barely 50 per cent capacity amid deepening uncertainties in bauxite availability.
By any means we have to run the refinery till December 5. Sourcing 92000 tonnes of bauxite from the state PSU will serve the purpose for ten days at least, added the official.
To run the one million tonne per annum (mtpa) refinery plant at full steam, VAL needs 300,000 tonnes of bauxite every month.
VAL had designed its refinery in Odisha keeping in mind the locally available bauxite. The aluminium major had entered into an agreement with state controlled miner Odisha Mining Corporation (OMC) for supply of bauxite. But attempts to mine bauxite at the ecologically sensitive Niyamgiri hills under OMC’s leasehold in Lanjigarh district were red flagged by the environment ministry that had scrapped the Stage-II forest clearance on August 24, 2010.
Owing to its total dependence on externally sourced bauxite, VAL has hitherto incurred cumulative losses to the tune of Rs 2500 crore.
The aluminum major, on September 6, had served notice to the Odisha government for temporary closure of its refinery from December 5 owing to absence of assured supply of bauxite to feed its refinery.
So far, VAL had filed 26 applications with the state government, seeking alternative bauxite deposits but to no avail.
GMDC has set a basic floor price of Rs 800 per tonne for sale of bauxite upto 50000 tonnes and Rs 750 per tonne above 50000 tonnes.

Hindalco faces Vedanta's mining fate in Odisha

Rediff Business - October 1st, 2012,

With locals protesting against Hindalco's move to mine Mali Parbat, the contractor who was working on making the mine operational has left. All work at the mine has stopped. However, at the Aditya smelter site, in Lapanga and away from the mine, work is on in full swing and the company hopes to complete the 359-kilo tonne aluminium smelter and a 900-Mw power plant in 2013.
The Utkal alumina refinery of 1.5 million tonnes in Kansariguda is expected to be completed by March 2013. However, with the mining of bauxite under a cloud, the fate of the project is hanging by a thread.
Vedanta, in the same region, has already faced the ire of locals and NGOs. The Union environment ministry has cancelled its mining licence and the company relies on bauxite from Gujarat and Chhattisgarh.
Owing to the non-availability of captive bauxite, Vedanta has been posting losses quarter after quarter. It has decided to shut the refinery.
The locals are upset with Hindalco's bauxite mining plans in Mali Parbat, saying it will make the water in the area disappear and jeopardise the livelihood of tribal people in the region. Hindalco refused to comment on issues with the locals in Odisha.
While Vedanta stayed in the limelight, Hindalco continued its work, though the local people protested against its mining activities from 1996. While in Vedanta's case it was the Lado Sikaka spearheading the movement, in Hindalco's it has been Prakrutik Sampad Surakshya Parishad.
In Vedanta's case, the problem arose as the Niyamgiri Hills were a subject of worship for the Dongria Kondh tribals, who protested against the exploitation of their sacred hill. In Mali Parbat, Hindalco is being accused of jeopardising the agricultural livelihood of local people.
Both companies wanted to set up aluminium refineries and smelter and mine bauxite. The region has the world's best and among the largest bauxite reserves.