UC RUSAL, the world’s largest aluminium and alumina producer, on Monday announced that it had signed a Memorandum of Understanding (MOU) with the Libyan State Economic and Social Development Fund (ESDF) to create a joint venture to develop an energy and metals complex in Libya. The agreement sets out a plan to develop an aluminium smelter with a capacity of 600,000 tonnes per year and a 1500 MW natural gas power station.
The parties have agreed to create a joint venture with UC RUSAL holding a 60% shareholding and the Libyan partner a 40% interest. The natural gas for the complex will be supplied by the National Oil Company of Libya (NOC) under a contract intended to be at least 30 years-long.
The MOU includes a pre-feasibility study of the technical, economic and financial parameters of the proposed complex. If the results of the study are positive, the parties plan to sign a final agreement to establish the joint venture in 2009 and start the construction of the gas power station and the aluminium smelter in 2010. The pre-feasibility study will help to determine the technology to be used for the project - RA-300 or RA-400 reduction cells (both developed by UC RUSAL’s Engineering and Technology Centre).
Commenting on the signing of the MOU, Alexander Bulygin, UC RUSAL’s CEO, said: “This Memorandum of Understanding marks another significant move forward in implementing the company’s strategy of strengthening our position in the global market and enhancing UC RUSAL’s competitiveness through establishing energy and metals complexes in strategically important regions. This will be the first aluminium smelter in Libya and will make a significant contribution to implementing the country’s large-scale programme of economic development. This project will help create a solid foundation for the country’s planned infrastructure projects and its exports will help to actively integrate Libya in the global economy.”
Hamed Houderi, General Director of the Libyan State Economic and Social Development Fund, said: “We are pleased to sign this MOU with an industry leader such as UC RUSAL, and believe that this project has the potential to diversify the overall Libyan economy and develop a new domestic industry with great potential for further downstream development”.
The aluminium produced by the complex in Libya will serve both the domestic demand as well as European clients.