Aluminum Producer RUSAL Spending Billions to Boost Refining and Smelting Capacity

In addition to building the $2-billion Taishet aluminum smelter, United Company RUSAL has
begun construction of another $2.3-billion smelter that is part of the Boguchanskiy Energy
and Metal Complex, shown here in an artist’s rendering.
United Company RUSAL, the world’s largest producer of aluminum, began construction in late July on the Taishet aluminum smelter located near Irkutsk, Siberia. The smelter project, with an annual capacity of 750,000 mt of aluminum, will cost approximately $2 billion.

A feasibility study of the smelter’s construction was conducted by Bechtel Corp. with the assistance of specialists from UC RUSAL’s engineering and construction division.

The Taishet smelter will comprise four pot rooms equipped with RA-400 cells developed by UC RUSAL’s Engineering & Technology Center.

The smelter will also include casthouse, anode, and energy shops, gas treatment facilities, and a complete complex of infrastructure facilities. Completion of smelter construction is scheduled for the fourth quarter of 2011.

“UC RUSAL’s major aluminum assets are concentrated in Russia, and it is here that we see big potential for developing new plants. We have developed the ‘smelter of the future’ concept which complies with the world’s strictest technological and environmental standards. The implementation of this project will allow the company to increase aluminum output by over 19% and will become an essential contribution to the development of the Russian economy,” said Alexander Bulygin, UC RUSAL CEO.

Capital spending on the project will reach about $200 million in 2007, according to the company, which estimated that preliminary work at the construction site will be complete by the end of the year, at which time major construction work will begin.

Work will include setting foundations for the reduction plant, casthouse and anode shops, construction of temporary and infrastructure buildings, and provision of power supply to the smelter site. Construction of residential buildings will start this year.

Approximately 6,000 people will be involved in the construction of the smelter, most of whom are residents of Irkutsk and theadjacent regions. After its launch the plant will employ a total of 3,000 people.

Apart from creating new jobs at the smelter itself, the company is planning to outsource a few secondary supporting functions to third-party contractors, which will ensure a 25% growth in the region’s employment rate.

UC RUSAL claims a market share of approximately 12.5% and 16% of global production of aluminum and alumina, respectively. The company was founded in March 2007 following the merger of RUSAL, SUAL, and the alumina assets of Glencore.