Mr Mohamed Alabbar signs with Chinese major to build aluminum plant in Malaysia

Gulf International Investment Group Holdings Sdn Bhd headed by Malaysian entrepreneur Mr Tan Sri Syed Mokhtar Al Bukhary and UAE based business leader Mr Mohamed Alabbar has entered into JV agreement with Aluminum Corporation of China to develop USD 1.6bn aluminum smelting plant in the State of Sarawak of Malaysia. The JV agreement marks a new milestone following the execution of the Heads of Agreement for the joint venture in February 2010.

Smelter Asia Sdn Bhd will develop, own and operate the private aluminum plant with an annual capacity of 370,000 tonnes during the Phase I. On further availability of power from the grid, the plant capacity is planned to be increased up to 700,000 tonnes. The smelter will be located in Samalaju Industrial Industrial Park about 60 kilometers from Bintulu and some 180 kilometers from the Bakun hydroelectric dam. Samalaju Industrial Park is earmarked by the Sarawak state government for heavy industries under the Sarawak Corridor of Renewable Energy master plan.

Alongside the signing of the joint venture agreement between GIIG Holdings and CHINALCO, the project company, Smelter Asia also executed the principal terms of the Power Purchase Agreement with Syarikat SESCO Berhad, the wholly owned subsidiary of Sarawak Energy Berhad for over 600 MW of power supply to the proposed aluminium smelting plant. Smelter Asia and Syarikat SESCO Berhad will jointly conclude the PPA by the middle of this year.

Mr Tan Sri Syed Mokhtar Al Bukhary said that "The global demand for aluminum is projected to grow by an average 4% over the next five years, with Asia driving the demand. Our strategic collaboration with CHINALCO for Smelter Asia will bring the best in class technology to create a modern aluminum plant that will contribute to the socio-economic growth of Sarawak state. The plant will create new jobs and drive the growth of supporting industries, thus contributing significantly to the development of the state of Sarawak as well as the Malaysian economy."

Mr Mohamed Alabbar said that smelter Asia is a powerful example of global collaborations to create a dynamic socio economic growth engine for Malaysia. The plant will not only benefit the country but also support the ASEAN region's development thrust by providing aluminum which is critical in driving the massive infrastructure projects that are being planned. The final design and construction plans for Smelter Asia are progressing and will be announced in due course.

Mr Zhang Chengzhong deputy GM CHINALCO said that "CHINALCO and its subsidiary CHALCO has been working closely with GIIG for the development of Smelter Asia Project over the past years. This signing of JV Agreement marks a significant milestone in the course of Project development. CHINALCO will make further efforts to strengthen collaboration with our reliable partner GIIG, adopt state of art smelting technology provided by our engineering company and expedite the construction of the project. I believe Smelter Asia would become an indispensable driving force that dramatically stimulates Sarawak economy growth."