UK-based Balli Grouphas signed an offtake agreement for phase 2 of the Al-Mahdi aluminium smelter in Hormozgan province in the south. The project will cost more than $500 million and is expected to be Iran's first metals project to be carried out on a buy-back basis (MEED 15:8:03, Cover Story).
The smelter's first phase is expected to come on stream in September 2005 with production capacity of 110,000 tonnes a year (t/y). Phase 2 will expand capacity by a further 110,000 t/y. Italy's Fata is supplying equipment. A third phase, including a captive power plant, is under study. Iranian Mineral Industries Development & Renovation Organisation (IMIDRO),which owns the project, has guaranteed to supply 110,000 t/y of aluminium from plants owned by its subsidiary, Iran Aluminium Company (Iralco), if the plant fails to come on stream on schedule. Iran has ambitious plans for its aluminium sector and aims to double production to more than 1 million t/y by 2009. Aside from the Al-Mahdi smelter, others are planned in Sirjan, Faza, Jajarm and Azerbaijan. In addition, plans are under study to produce alumina from alternative feedstocks . Currently, most bauxite is imported from Australia and India.
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