Dubai Aluminium Continues Expansion by Acquiring 19 percent Stake in Brazilian Alumina Refinery

State-owned Dubai Aluminium Company Limited (DUBAL) (Dubai, United Arab Emirates) plans to acquire a 19 percent stake in Companhia Alumina do Para (CAP), a subsidiary of mining company Companhia Vale do Rio Doce (Vale) (Rio de Janeiro, Brazil). According to Industrial Info Resources (Sugar Land, TX), the deal is expected to be finalized soon, provided that both parties agree upon certain conditions. Vale would hold a 61 percent stake in CAP, while Norway's Hydro Aluminium AS (Oslo), a subsidiary of Norsk Hydro ASA (Oslo), will hold a stake of 20 percent.

CAP is developing a greenfield alumina refinery in northern Brazil. The refinery site is at Barcarena in the state of Para, near Vale's Alunorte alumina refinery. The two-line refinery would have an initial production capacity of 1.86 million tons per year, with a possible future capacity expansion of up to 7.4 million tons per year. The first phase of the refinery is expected to be operational in late 2012, although market conditions would decide the exact start-up date. CAP would operate the refinery.

DUBAL's interest in acquiring a stake in the alumina refinery is to ensure a supply of alumina for its Jebel Ali smelter, one of the world's largest single-site smelters. DUBAL plans to produce 1 million tons of aluminum this year, an increase of 40,000 tons over last year. The company's target is to reach a production capacity of 2.5 million tons per year by 2015.

In November 2008, DUBAL formed a joint-venture company, Cameroon Alumina Limited, with India's Hindalco Industries Limited (Mumbai) and Hydromine Incorporated (New York City) to explore and develop a 1.2 billion-ton bauxite deposit in Cameroon. The joint venture will set up a bauxite mining and refinery project at Minim-Martap near Ngaoundere. The tentative completion date of the refinery project, which will have a capacity of 3 million to 3.2 million tons per year, is 2013.

In February 2007, DUBAL and the state-owned investment and development company Mubadala Development Company (Abu Dhabi, United Arab Emirates) formed the 50:50 joint-venture company Emirates Aluminium (EMAL) to develop a 1.4 million-ton-per-year greenfield smelter complex at the Khalifa Port and Industrial Zone in Abu Dhabi. Upon completion, the $8 billion smelter will be the largest of its kind in the world. The first phase of the project is scheduled to be completed in 2010 with a production capacity of 700,000 tons per year. While Mubadala will supply the smelter with bauxite, DUBAL will supply the smelter with its proprietary DX technology. The DX technology cell brings down the unit quantity of power required to produce aluminum.

In January 2008, EMAL formed a joint venture with Emaar the Economic City (Jeddah, Saudi Arabia), a real estate development and management company, and the Saudi Arabian General Investment Authority (Riyadh, Saudi Arabia) to set up a 700,000-ton-per-year greenfield smelter at the King Abdullah Economic City in Saudi Arabia. Construction of the $5 billion project is expected to begin in 2009 and would be completed by late 2011.