Aluminium Bahrain to decide on production train by the end of the year

28 August 2009

Plan would boost aluminium production capacity to 1.2 million tonnes a year

State-run Aluminium Bahrain (Alba) will make a decision by the end of 2009 on whether to resume its stalled plan for a sixth aluminium production train, following a review of the project.

If built, the train will boost the company’s production capacity to more than 1.2 million tonnes a year (t/y).

In January, Alba announced it was delaying the scheme, first mooted in 2005, because of falling global demand for aluminium.

But since then, a recovery in the global metals markets has revitalised interest in the scheme. On 26 August, aluminium was trading at $1,884 a tonne on the London Metal Exchange, down almost 50 per cent year on year, but still higher than its $1,300 a tonne low in February.

Ahmed Saleh al-Noaimi, chief executive officer of Alba, tells MEED he is still working on the review of plans to expand the existing facilities at Sitra, including securing gas supplies. “We either need to import energy or conserve our existing facilities, and that is part of the review,” says Al-Noaimi. “Whether or not to proceed with the sixth [production train] is at the top of the list of the review. We are receiving outside help on the strategy and expect to communicate [the results] by the end of this year.”

Alba’s fifth train, which opened in the spring of 2006, boosted its production capacity by 320,000 t/y to its current level of 880,000 t/y, making Alba the second-largest aluminium producer in the Middle East.

Al-Noaimi says Bahrain’s proven natural gas reserves will fall to about 75 billion cubic metres by 2011, from 84 billion cubic metres currently, making a gas import deal a priority for the country.

Although Bahrain signed headline agreements to import gas from Qatar and Iran in 2007 and 2008 respectively, it has yet to finalise an agreement with either country.

The government of Bahrain owns 77 per cent of Alba.

The other shareholders are Saudi Arabia’s Sabic Industrial Investments, with 20 per cent, and Germany-based Breton Investments, with 3 per cent.

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