State-owned aluminium giant secures supply of CPC, ensuring business continuity
Dubai, United Arab Emirates: Dubai Aluminium ("DUBAL") -- the entirely state-owned enterprise whose Jebel Ali operation ranks as the world's largest single-site primary aluminium smelter using pre-bake anode technology - has expanded its interest in the upstream (raw materials) sector by purchasing a 20 per cent stake in a calciner development project as part of a joint venture with Sinoway Carbon Energy Holdings, Hong Kong, for an undisclosed sum. The new venture, known as Sinoway Carbon Company Limited ("Sinoway"), entails the construction of a 560,000 tonnes per annum calciner in Shandong, China.
The end-product of the calcination process, calcined petroleum coke ("CPC"), is a strategic raw material for the aluminium smelting industry, where it is used in the manufacture of carbon anodes for the electrolytic process of extracting the metal from its ore. DUBAL will be entitled to an annual off-take volume of CPC for its smelting operations
The Sinoway calciner is being built in two equal phases (i.e. 280,000 tonnes per phase). Construction of the first phase is at an advanced stage: completion is scheduled for May this year. Phase two is scheduled for completion in the fourth quarter of 2013. The plant will employ Chinese shaft technology - a well-proven, simple-to-install, easy-to-operate system that gives better yield than other technologies at substantially lower capital- and operating expense. China has a surplus supply of green petroleum coke ("GPC"), a by-product of oil refining and the raw material consumed by a calciner. Indeed, China currently produces more than 40 per cent of annual global GPC/CPC production, with several GPC refineries being in close proximity to the Sinoway development site.
Commenting on the deal, Abdulla Kalban (President & CEO) said that DUBAL's investment in Sinoway represents a strategic opportunity to mitigate the company's supply and quality concerns, thus contributing to business continuity. "The aluminium smelting process is extremely sensitive to CPC quality, especially in terms of anode life and sulphur emissions. Good quality GPC is necessary to produce the quality of CPC required by DUBAL, and China's GPC is well within this range," Kalban explains, adding that at present, DUBAL sources its CPC supply from six calciners, most of which source their GPC from China. "A relatively restricted supply of anode grade GPC worldwide is, however, pushing-up the associated CPC prices. CPC is one of the main drivers for cost of production, hence an important factor in the business equation. With a secure supply of suitable quality CPC from Sinoway calciner, DUBAL will be well placed to counter this trend, with direct benefits to the bottom-line."
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About DUBAL
With a hot metal production capacity in excess of one million tonnes per year, DUBAL's Jebel Ali complex ranks as the world's largest single-site primary aluminium smelter using pre-baked anode technology. DUBAL is internationally renowned for its premium purity, high quality products; and exports more than 88 per cent of its annual production to about 57 countries across the globe. The company, which is widely acknowledged as the UAE's industrial flagship, places the safety and health of its employees above other priorities. DUBAL also owns 50 per cent of Emirates Aluminium ("EMAL") in Al Taweelah, Abu Dhabi, where the first phase comprise 756 cells in two potlines (with a total annual production capacity of 800,000 tonnes) has been fully operational since the end of 2010. Construction of EMAL Phase II, which will increase EMAL's total production capacity to 1.3 million tonnes per year, began mid-2011. In addition, DUBAL holds shares in upstream development projects.
For further information, visit www.dubal.ae
© Press Release 2013
