Alba revenues likely to cross $2 billion this year- Bahrain

Aluminium Bahrain (Alba) is expected to generate at least $2 billion in revenue this year compared with $1.5 billion generated last year. Alba is constantly increasing its production capacity and in 2006 it produced 872,388 tonnes of aluminum, a year on year increase of 5.1 per cent, Global Investment House in its report titled 'GCC aluminum sector - attracting strong investments', said.

"Aluminum is the third most abundant element in the Earth's crust and constitutes 7.3 per cent by mass. The aluminum industry makes a significant contribution to the global economy as well as to more than thirty individual economies. It is estimated that the aluminum industry employs over a million people world-wide.

"Aluminum smelting is a capital-intensive, technology-driven industry concentrated in a few relatively dominant companies. In recent years, China has emerged as a main driver of market fundamentals. Russia is also growing in importance in terms of industry developments and the GCC region is set to emerge as a major production centre due to availability of cheap source of power which constitutes more than 25 per cent of the cost.

"The GCC region has established smelters in the UAE and Bahrain. Alba was commissioned in 1971 to diversify the national economy from its heavy dependence on oil. Alba has since grown from a modest 120,000 tonnes per annum smelter to 872,000 tonnes per year, making it one of the largest smelters in the world, with plans to expand the capacity further to 1.3m tonnes per year.

"Besides UAE and Bahrain, other GCC countries - Oman, Qatar and Saudi Arabia too, are planning to set up aluminum smelters, entirely on the basis of the availability of inexpensive gas. Saudi Arabia has also deposits of bauxite. UAE to build up is likely to exceed 3.75 MPTA by 2010 when the new smelters are commissioned in Oman, Saudi Arabia and Qatar, and when the planned expansion program of Alba with installation of the sixth pot line project is implemented. The capacity will further increase if the long-term plan of DUBAL to achieve 1.5 metric tones per year by 2011 is realised.

"Due to the expansion in the construction sector, several extrusion plants have been set up all over GCC states. There are 22 major extrusion plants in the region with a total production capacity of 300,000 TPA, and the overall capacity utilisation exceeds 88 per cent. About 60 per cent of the extruded products are used in GCC and the balance is exported to international markets."