Mubadala, Dubal to build largest single site smelter complex
Posted: 20 February 2006
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Mubadala Development Company and Dubai Aluminium Company (Dubal) signed a joint protocol and a joint development agreement yesterday to make the UAE a first-tier player and a global force in the aluminium industry.
 Mubadala, a wholly owned investment vehicle of Abu Dhabi also holds 51 per cent of Dolphin Energy.
The joint protocol establishes a basis for joint exploration business in both the upstream and downstream aspects of the aluminium industry.
The joint development agreement entails construction and operation of a more than $6 billion world class green field aluminium smelter complex with 1.2-million tonne capacity a year and related facilities at Taweelah in Abu Dhabi.
When finished, it will be the largest single site aluminium smelter in the world. The smelter will be developed in two phases and the first phase is expected to be operational in 2010. The front engineering and design studies are scheduled to be completed in 2007.
Mubadala and Dubal will jointly develop, construct, own and operate the complex at the Khalifa Port and Industrial Zone in Taweelah.
Plans are already under way to establish a joint company with 50 per cent stake each for both companies. The joint company will oversee the operation and management of the new aluminium smelter.
A joint steering committee with senior officials from both companies has already been formed to look into the possible business opportunities and to study the creation of a UAE-based centre for excellence, research and development in aluminium industry.
Further, the deal between DUBAL and Mubadala will result in creation of more than 4,000 jobs, of which a large percentage will be taken up by UAE nationals. The project will also add value to the local energy pool, creating an industrial venture which will have in excess of two million tones capacity as well as raw material production and downstream applications.
Abdullah Kalban, CEO, Dubal, said: "We do believe there is ample room for additional capacity on the back of strong international demand. Demand is growing at an annual rate of 4 per cent or 1.3 million tonnes a year. This demonstrates the need to establish a smelter or two every year which is not happening in the world right now."
Khaldoon Khalifa Al Mubarak, CEO, Mubadala added: "We plan to sign the joint venture agreement for the development of Abu Dhabi smelter within the next six to nine months. Detailed studies and engineering aspects will be finalized within the next 18-20 months."
When completed and at full capacity, the new smelter will have 2,600MW of power. The joint venture company has already started negotiations for the required gas volume for the project.
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