BINTULU, Malaysia Feb 11 Malaysian aluminium
fabricator Press Metal (PMET.KL) said on Monday it has chosen
the Aluminum Corp of China Ltd (Chalco) (2600.HK) as its
technical partner for a $770 million aluminium smelter project.
Press Metal plans to build a smelter in Malaysia's Sarawak
state, on Borneo island, with first-phase production capacity
of 100,000 tonnes a year, starting with 50,000 tonnes by
mid-2009, Chief Executive Paul P.K. Koon told Reuters.
He named Chalco (601600.SS) as project partner but said
there was no talk yet of the Chinese firm taking an equity
"At the moment, it is just technology and engineering," he
said on the sidelines of the launch of a state development
agenda for Sarawak, which plans to use hydro-electricity as the
platform for growing a range of power-intensive, heavy
Koon put the first-phase capital cost at about 1 billion
ringgit ($310 million), with the overall cost potentially
reaching 2.5 billion ringgit, though he did not say how much
extra production this additional investment would imply.
"It's a small project," Koon said, adding that the smelter
would be funded using project finance.
The smelter would source its alumina supplies from
Australia, he added, but did not elaborate. "There is quite a
lot of alumina around. Primarily it will be Australian," he
Press Metal has signed a memorandum of understanding with
Sarawak's power distributor, Sarawak Energy Bhd SARA.KL, to
take 510 megawatts of power for the new smelter, Koon said.
($1=3.230 Malaysian Ringgit)
(Writing by Mark Bendeich, editing by Jacqueline Wong)