With energy accounting for as much as 30 per cent of an aluminium smelter’s running costs, relatively cheap gas supplies in the Gulf give the smelters a significant advantage over competitors elsewhere in the world.
However, growing demand for energy is placing increasing pressure on supplies. Bahrain is already in talks with Qatar and Iran to secure imports of gas.
“We are looking at ways and means of conserving energy,” says Ahmed al-Noaimi, chief executive officer of Alba. “We have to be more efficient in energy consumption. We cannot just keep running more power stations.”
Al-Noaimi declined to give details of the energy-efficient technologies it is looking at. However, its expansion plans rely on securing enough energy.
“Expansion is still on our agenda but it is about timing,” he says. “Our efforts depend on securing energy.”
Alba’s complex at Hidd is served by a 2,200MW captive power plant. Its most recent expansion project was completed in 2005 when it added a fifth reduction line as part of a $1.7bn plan that included raising output at the power plant from 1,500MW.
With three aluminium smelting projects in the Gulf expected to come on line in the next three years, Al-Noaimi says the industry needs to be wary of having too much capacity.