Emirates Aluminium to hit 1.3 mln tonnes a year by mid-2014 -CEO

Reuters

ABU DHABI, Nov 6 (Reuters) - Emirates Aluminium (Emal) isahead of schedule with the expansion of its production capacityto 1.3 million tonnes a year and expects to complete the projectin mid-2014, the company's chief executive said on Wednesday.

Emal's $4 billion project to boost capacity from about800,000 tonnes a year had been expected to be completed by theend of 2014.

"We are three months ahead of schedule on that," CEO Saeedal-Mazrooei told reporters on the sidelines of a conference inAbu Dhabi, adding that he expects strengthening global demand toabsorb the company's increased output.

Canadian engineering contractor SNC-Lavalin said inSeptember that it had achieved the first hot-metal productionfrom the expanded facility nearly three months ahead ofschedule.

Mazrooei said that Emal's production could rise to 810,000tonnes for 2013 before hitting 1.3 million tonnes next year.

Analysts polled by Reuters last month see the aluminiummarket remaining oversupplied by about 600,000 tonnes next year, against the 1 million tonnes forecast in a previous poll.

Although benchmark London Metal Exchange aluminium is trading around $1,828 a tonne, Emal is selling at an averageprice of about $2,200.

"The premium is good," Mazrooei said, referring to theamount paid above LME prices to withdraw physical aluminium fromwarehouses registered by the exchange. "The LME is low. It ishealthy for us."

Aluminium premiums climbed nearly 5 percent last month,while benchmark aluminium on the LME fell by about 1 percent.Producers rely on a high premium to remain profitable,especially in an oversupplied market.

Emal is one of the United Arab Emirates' two flagshipaluminium businesses - alongside Dubai Aluminium - that are tomerge to create the world's fifth-largest aluminium company withan enterprise value of $15 billion.

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