Alstom, which will carry out engineering work in Switzerland, is expected to sign the contract once official project approval and financial close on the estimated $2,300 million project is achieved in December (see Banking & Finance). The lump-sum turnkey (LSTK) contract involves construction of an 800-MW power plant at an estimated cost of $460 million.

Kinsman said that the power island would be one of several LSTK contracts for discrete technology on the project, which centres on the construction of a 350,000-tonne-a-year smelter, based on AP 35 technology by Canada's Alcan. 'We are looking at about seven-nine discrete technology packages,' he said. Other contracts to be let will cover craft, speciality manufacturing and services packages, Kinsman added. The EPC management (EPCM) contractor for the smelter is US-based Bechtel, which is carrying out the E&P works in Muscat.

First metal from the smelter is scheduled for mid-2008 with full commissioning by the end of the year.

The shareholders in Sohar Aluminium are Oman Oil Company (OOC)and Abu Dhabi Water & Electricity Authority (ADWEA), both with 40 per cent, and Alcan, with the remaining 20 per cent.

A second potline of similar size is planned. 'All the shareholders are keen to move ahead with phase 2 as soon as possible,' Kinsman said. On the second phase, Alcan has the option to take up to a 60 per cent stake in the potline.

For Alcan, the Sohar project represents its first investment in the Middle East and is part of its overall strategy to shift production to low-cost centres. 'Following our analysis and assessment in terms of low-cost energy, labour, port facilities and logistics, we believe we are pursuing one of the most attractive investments in the world [at Sohar],' Alcan's president for primary metals, Cynthia Carroll, said at the conference.