National Aluminium lines up $1 billion project in Iran

Public sector National Aluminium Company Ltd (Nalco) has lined up a $1 billion investment to put up smelters (1.55 lakh tonne smelter in the first phase and another identical capacity smelter in the second phase) and a power plant (750MW gas based captive power plant) in Iran. This will be implemented in joint venture with Kerman Development Organisation, Iran. Nalco will have majority stake in the project along with management control.

Meanwhile, the metal refiner will complete its Rs 5,100 crore expansion of its domestic production facilities by end of current calendar. It would then ramp up bauxite mining capacity from 48 lakh tonne to 63 lakh tonne, alumina refinery to 21 lakh tonne from 15.75 lakh tonne, and metal production to 4.6 lakh tonne from 3.45 lakh tonne. It is estimated that, even after meeting the requirement of its smelters at home, Nalco will be left with a surplus of 1.2 million tonne of alumina for the export market. This surplus alumina would be sufficient to produce around 5 lakh tonnes of metal.

Nalco’s overseas investments are part of its strategic plan to convert its surplus alumina production into metal in geographies with lower energy costs. It has already signed a deal with the Indonesian government to invest $3.4 billion in setting up a 5 lakh tonne smelter in two phases and a 1,250 MW power plant. Investments in South Africa are also currently under consideration.