Emirates Global Aluminium (EGA) is planning to spend $3bn to build the UAE’s first alumina refinery by the end of 2017, after the completion of feasibility studies for a site in Abu Dhabi.
EGA was formed last year through the merger of Emirates Aluminium (Emal) and Dubai Aluminium (Dubal), combining $15bn in assets across the Middle East and Africa, including two operations in Africa: Guinea Alumina Corporation and a 45% stake in Cameroon Alumina.
“We are building the refinery to secure our materials,” CEO Abdulla Kalban told reporters, adding that the refinery would produce two million tonnes of alumina a year in its initial 2017 phase, with plans for an additional two million tonnes in its second phase.
Emirates Global Aluminium currently produces 2.4 million tonnes of aluminium products each year – nearly 50% of the Gulf’s annual aluminium production of five million tonnes – and is already the world’s fourth largest producer of the metal.
Aluminium production in the Gulf has been rising rapidly, aided by the region’s low energy costs, strong logistical connections and the price of the metal, which rose 10% this year.
Kalban has predicted that EGA will boost its production by 200,000 tonnes over the next six years, as “global demand growth is forecast to sustain at about 5.8% annually until 2020.”
Roughly one tonne of Alumina, or aluminium oxide, is extracted from every two tonnes of bauxite, and can in turn be smelted into about half a tonne of aluminium.
Though alumina is typically refined close to source, the feasibility study commissioned by EGA must have determined that it is also economical to export the raw bauxite from Guinea and Cameroon to the UAE – likely in a reflection of the favourable energy prices in the Gulf.
Kalban added: “We are looking at further international expansion.”