x Abu Dhabi, UAESaturday 22 July 2017

ADBIC seals deal for aluminium plant

The Emirate moves to capitalise on its oil reserves by expanding its manufacturing base with the $100m plant.

The global aluminium sector has been battling the effects of the economic slowdown but signs of recovery are beginning to appear.
The global aluminium sector has been battling the effects of the economic slowdown but signs of recovery are beginning to appear.

The Abu Dhabi Basic Industries Corporation (ADBIC) has signed a deal to develop a US$100 million (Dh367m) aluminium plant as the emirate moves to capitalise on its oil reserves by expanding its manufacturing base. The company has signed a joint venture agreement with Midal Cables, an aluminium rod and electrical conductor maker based in Bahrain, to build the plant, which will have a planned capacity of 150,000 tonnes of aluminium products a year, including aluminium rods and electrical overhead conductors. Construction will begin in the first quarter of next year at Abu Dhabi's Khalifa Port and Industrial Zones, ADBIC said yesterday. The plant would help further develop the capital's new downstream industries, it added.

The global aluminium sector has been battling the effects of the economic slowdown, which cut demand for commodities and forced producers to trim production. But there are now signs that demand for the metal may be picking up again, driven by increased production in China, after prices fell 61 per cent from a record $3,380.15 a tonne last July. The new aluminium plant is the first step towards ADBIC's metals cluster, which the firm said would play a fundamental role in expanding Abu Dhabi's downstream manufacturing in the metals sector.

The cluster will be located between Abu Dhabi and Dubai and focus on base metals such as aluminium, steel and copper. "This partnership brings together the technical expertise of one of the world's largest manufacturers of aluminium rod and conductors with the experience of one of the leading industrial investment and development companies in the region," said Jamal al Dhaheri, the senior vice president for metals at ADBIC. The joint venture partners also signed an initial agreement with Emirates Aluminium Company (EMAL) to provide molten aluminium, the plant's main feedstock.

The aluminium is kept in a molten state during transport in special containers. The firm said its new plant would be ready to receive its first batch of aluminium by the second quarter of 2011 from EMAL, which is building what will become the world's largest aluminium smelter complex. The first phase of the EMAL smelter is expected to be operational at the end of next year, with a capacity of 700,000 tonnes a year.

"EMAL will play a fundamental role in supporting the development of ADBIC's metals cluster," said Mr al Dhaheri. "This partnership not only helps to drive ADBIC's contribution to Abu Dhabi's industrial diversification, but also leverages EMAL's planned aluminium upstream production capacity." ADBIC was formed in 2007 as a government-owned corporation with interests in reinforced steel bars, wide rods, steel beams, copper and aluminium.

It also invests in companies that make ethylene and polyethylene for applications in plastic films, containers, packaging and piping. ADBIC owns stakes in Emirates Steel Industries, the largest integrated steel plant in the UAE, and Abu Dhabi Polymers Park, the first industrial zone in the UAE dedicated to plastics conversion. skhan@thenational.ae